“German Calls for Grexit Mount as EU Stunned by ‘No’ Vote”
Reuters, July 5, 2015
“France and Germany called for an emergency summit of euro zone leaders to discuss Greece’s stunning referendum vote on Sunday to reject bailout terms, as calls mounted in Berlin to cut Athens loose from Europe’s common currency. German Chancellor Angela Merkel’s deputy said Athens had wrecked any hope of compromise with its euro zone partners by overwhelmingly rejecting further austerity. … His comments reflected a mounting public demand in the most powerful EU country, which is also Greece’s biggest creditor, to eject Athens from the 19-nation currency area, of which membership was intended to be irreversible. It was not clear whether Merkel, who has repeatedly said she wants to keep Greece in the euro zone, would shift to a similarly hard line. … The vote sharpened differences between Greece’s few remaining sympathizers in the euro zone – mostly in Italy and France – and hardline countries led by Germany that are fed up with pouring loans into Greece. … Any future negotiation would run up against the hardening of opinion in Germany. The head of Germany’s savings bank association said Greece had broken with the rules of the euro zone and should leave the currency bloc. The head of the German exporters’ body said he could not see how Greece could stay in the euro zone now. Hardline German Finance Minister Wolfgang Schaeuble, denounced in ‘No’ campaign posters as a blood-sucker, has leaned towards making an example of Greece and pushing it towards the exit, sources familiar with his thinking say.”
Quickie analysis: Punishing Greece for not voting the right way doesn’t seem like a helpful path forward.