Sir, The headline to Gideon Rachman’s interesting article (December 30) is unfortunate: “Eurozone’s weakest link is the voters”. Surely economic policy should be at the service of European citizens, and not the other way round. If Greek citizens are democratically voting against policies that are seen as failing, the policies need changing. Financial markets seem to be panicking about the possibility that far-left party Syriza could win or lead a coalition after the elections. But Syriza in its economic programme advocates making Greece’s debt more sustainable, to have a longer grace period for servicing it, and for relating debt service to growth. It is proposing to use the resources freed by such an approach to help recover wages and pensions (which have fallen dramatically) and to finance increased investment, to achieve a recovery of employment. It proposes to increase credit to SMEs and limit tax evasion.
These are all reasonable proposals, which many economists would support. What seems key is that European policy makers show flexibility, so that whatever the outcome of the Greek election they engage in constructive negotiations with the new government, to facilitate Greek economic growth and reduce unemployment from its current abysmal level. Financial markets should provide the time and space for eurozone governments and institutions to negotiate a positive outcome with a new Greek government. They have done enough damage already, so it is time they were more constructive.
Financial Markets Director,
IPD, Columbia University,
New York, NY, US