“Tsipras' choice to hold a referendum was perhaps inevitable, the only way out of the negotiating impasse he had slipped into. But over time it represents a "lose-lose" solution, where he risks losing regardless of the outcome. And with him Greece. An important starting point for reflection for those who, in other European countries, propose similar referendums”. This is the conclusion of the acute analysis by Lorenzo Bini Smaghi, former member of the board of the ECB and now president of Société Générale, in today's "Corriere della Sera".
It is certainly legitimate to give the people the floor on crucial issues for citizens' lives, but it is the times and methods that make the difference. Confirming that the devil is in the details. Greek referendum on the European level? Ok, but because after the expiry of the installment due from Athens to the Monetary Fund on 30 June and not with a suitable advance, how was it possible to do with an acceleration of the negotiations? Democratic choice or trivial cunning? As for the referendum on the euro proposed by Beppe Grillo, who not by chance praises Tsipras, beyond the technical problems, it is time to clearly state what the real substance is: instead of asking Italians whether or not they want the euro, why not go to the heart of the problem that everyone can really understand by asking Italians if they are really willing to lose half of their assets and their incomes with the return to the lira?
But what interests us now are the effects of the Greek referendum, analyzed by Bini Smaghi, both in the event that the Yes wins and in the event of a No victory.
VICTORY OF THE YES TO THE EUROPEAN PLAN – "If the Yes to the European program wins in the Greek referendum, Tsipras - writes Bini Smaghi - will be forced to implement it, even against the will of his party" which has already said it supports the No. New elections could be reached, but what the head of Syriza did not understand is that “the mandate of his electors was above all to keep Greece in Europe and in the euro, but to obtain better conditions than its predecessors. "In this Tsipras has failed" observes Bini Smaghi, who adds: "The Greek leader - also observes the banker - will then have lost the trust of the other European heads of government, whom he managed to unite against himself in an exasperating and inconclusive negotiation ”.
VICTORY OF NO IN GREECE - “If the No to Europe wins in the Greek referendum, Tsipras – writes Bini Smaghi – will find himself having to manage Greece's exit from the euro in dramatic conditions” because “the adoption of a new currency, a new monetary legislation to allow the Greek central bank to finance the budget deficit, will lead to a sharp devaluation with negative repercussions on savings and on the real value of salaries and pensions”. At that point, "to avoid the collapse of the financial system, which will need new capital injections, Tsipras will still have to negotiate with international institutions to obtain new aid, which will inevitably be linked to stricter conditions".
Finally, the default “will trigger international lawsuits with private creditors, which will hold Greece back for years, as the example of Argentina demonstrates”. And more generally, investors will tend to withdraw "with recessionary effects on the Greek economy" and without it being certain that the Tsipras government will be able to save itself.
