Neither in or out, but a temporary Grexit is now on the table

As always in the EU or in the Eurozone countries, differences of opinion end up with wishy-washy compromises which only maximise the level of dissatisfaction. The EU has become expert at choosing the least attractive solutions in its quest for divine consensus.

After 5 years of trying to keep Greece from leaving the Euro, Germany has finally put forward the compromise position of a 5 year time-out from the Euro, a temporary Grexit which, in all likelihood, would become permanent if it is adopted. The time-out would be offered to Greece if they do not manage to pass some emergency resolutions through their parliament by Wednesday. But the matter of greatest significance, which highlights the fundamentally flawed nature of the Euro, is that a Grexit – even just a temporary one – is for the first time formally acknowledge by the Eurozone countries as being on the table.

It will be painful in the short term but the best for Greece is to leave the Euro, stay in the EU and build up a strong New Drachma. I hope they do take a time-out, that their debt is then restructured, that they get help to and do get back on to their feet and eventually that they make the time-out a permanent exit. And that then leads to an orderly dismantling of the Euro – or at least a suspension of the Euro – to be revisited again when political union is achieved – if ever.

A currency union has to be the natural consequence of a political union and cannot be used to coerce politically unequal nations into a phoney political union that their populations do not want.

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