About Greece and Italy: Oy. And also: Vey.
I don’t quite know what else there is to write. After months of trying to wrangle a deal together to help bail Greece out of its dire fiscal straits, and after praising the deal, the Papandreou government decided to contract a serious case of multiple personality disorder, and call for a referendum on the bailout package. I have read in some quarters that the referendum need not take place immediately, and that if set far enough into the future, the government could work to convince Greek citizens that a “no” vote would be completely irresponsible but, well, come on; does anyone really think that the Greeks will vote for a bailout plan which imposes dramatic austerity measures upon Greek society? And given that Germany played the most prominent role in crafting the bailout plan–and the fact that Germany is not all that popular right now in Greece (the austerity measures have ignited a whole host of jokes and not-jokes in Greece that compare present-day Germans to . . . um . . . certain Germans of a previous and horrible era)–does anyone really believe that Teutonic associations with the bailout package will help convince the Greeks to support the bailout package? The European announcement that Greece will not receive the sixth tranche of bailout money until and unless it adopts the bailout plan will help ensure that the vote is held relatively quickly, which means that the Greece government will face an uphill battle (understatement of the year) in convincing voters to support the bailout plan.
And then, there is Italy. Third largest economy in Europe, and the place is a mess, run by a prime minister who is–let’s not mince words here–a clown. As the story on Italy indicates, it would be too expensive to bail Italy out, so the few remaining weapons available to the Eurozone to combat the crisis in Greece are not available to combat the crisis in Italy. Rome and Athens were once the guiding lights of the Western world. Now, they have been reduced to beggars. Stars help us.
If you have the stomach to follow the action, be sure to check out the Financial Times’s liveblog of the G20 meeting in Cannes. Don’t eat anything while you read. You might just lose it.