The Greek financial bailout and the effect on its citizens is a painfully poignant example of the effect of inadequate financial regulation. It is perhaps a foreboding forecast for the future of an Irish society which has a higher domestic debt than the crippled Greeks.

Living through an age of austerity is now a political reality for the Greeks and will shackle most of its current generation. Their reaction and its effect on those in power should provide a stellar scale of analysis for other Governments. Effectively the austerity measures of the Greeks creates a real-time scale of consequences for political actors. This scale could be highly influential on Governments in similar situations, enabling them to determine how far people can be pushed when trying to decimate crippling debts.

The necessity of austerity measures and conditions of the bailout mean that no matter how unpopular with the Greek electorate, sledgehammer economics consisting of cuts, streamlining, shrinking of social welfare and essentially increased unemployment are all going to be devastating inevitable bi-products of the rescue deal.

The political will in Greece at the moment to engage in such measures is strong, but political will is enabled by the electorate. Will the Greeks continue to support a Government that has essentially committed themselves to a devolution of Greek society? Although an economic necessity for Greece’s financial survival, its people are already revolting and with time and further punitive measures this can only increase.

This situation should raise some alarming questions for those fronting the bill for the Greek Bailout. Is it possible for any Greek elected party weary of political survival to enforce the tough economic measures in their totality, which are fundamental prerequisites of the bailout? Unless political parties are willing to engage in political suicide, the realization of these measures in full are a seriously doubtful outcome.

The Germans approach to the handling of this situation and some calls from within the Bundestag for the Greeks to be thrown out of the euro should not simply be palmed of as political pandering for domestic approval. It’s true that Merkel had to appear as reluctant as possible to her own electorate and act as if her hand was forced, and in many respects it was. She evoked the image of a catastrophic collapse of the euro and stressing the effect of this on the German people as a resounding reason to back a Greek bailout. There is however a true underlying reluctance that should not be underestimated and this reluctance is reflected in the severity of the conditions of the bailout.

“If Greece is ready to accept tough measures, not just in one year but over several years, then we have a good chance to secure the stability of the euro for us all.”- Merkel

Although the Greeks have been rescued from financial oblivion, their inevitable diluted version of the tough measures required will anger their financial backers and make these backers increasingly unwilling to engage in any other rescue packages.

“There is a fear in the financial markets that the government will be either unwilling or unable to deliver these austerity measures.” -Ken Wattret, chief European economist at BNP Paribas.

Ireland should be sitting on the edge of its seats to see how smoothly the Greek bailout materializes. The ramifications of political turmoil and a dissolved Government in Greece would be devastating to any future financing Ireland may desperately crave.

The Greeks are in an ironically privileged position of being the first in the Eurozone to be bailed out. Although the Greeks will never see it that way, any further bailout will undoubtedly be stricter and given the future outcomes of the Greek situation, further rescue packages may not be forthcoming at all. An open objection from member states to another financial bailout could have devastating repercussions for the future stability and tenure of the euro and more worryingly a cataclysmic effect on Ireland.

The bailout may seem crippling to the Greeks now, but if Ireland was to stick its hand out in the future the results could be paralyzing.

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