Greece’s Brilliant Bailout Decision

Greek Prime Minister George Papandreou spooked world markets with his announcement that he would put his country’s euro-zone bailout up to a vote. And that’s exactly what he wanted, writes Robert Kuttner of The American Prospect. Germany is standing firm on the conditions already set on the bailout—including a 50 percent reduction in Greek debt held by banks—but Kuttner says the banks are playing with the fine print in ways that could put Greece right back in the austerity trap. Papandreou’s proposed referendum is a message to Europe’s financial and political leaders that they can’t alter the terms of the deal by stealth, because if it’s altered much more, default might start to look like a better option. “Papandreou’s is a brave, nervy, high-stakes move,” writes Kuttner, “and one that deserves our respect.”

Read it at The American Prospect