guardian.co.uk, Thursday 17 May 2012 21.00 BST
It has become clear that the cost of Greece leaving the euro will vastly outweigh the cost of forgiving them their debts ($1,000,000,000,000, 17 May). With the second Greek election looming, the objective of Angela Merkel and the other austerity-loving bullies is to frighten Greek voters into a retreat on their refusal to swallow neoliberal snake oil. Expecting ordinary people to pay such a heavy price for a financial disaster caused by an incompetent political elite, greedy financiers and the tax-dodging rich is a disgrace. The Greek people will see through this bluff and so should we.
Peter Robbins
London• A swift Greek exit from the euro is not the solution – instead a swift nationalisation of banks in Europe is needed (There is only one way to end this nightmare: Grexit, 16 May). Greece is a symptom and not a cause, certainly not the major cause, of the present nightmare in globalised finance. Greece accounts for less than 2% of EU GDP, and its debt levels are statistical blips in the context of the outstanding assets of the world banking system. A Greek exit does not address the inherent problem in the current architecture of banking, that of amplifying noise in trading in financial services and thus creating massive financial instability. The consequences of such instability cannot be managed in a democratic society.
Banks are borrowing at virtually no interest from central banks to lend to governments at a higher interest rate. This public subsidy has not, however, resulted in much new lending by banks to businesses. This is madness. The banking system that crashed four years ago is now beyond repair. The start of a policy of direct lending to governments by central banks and direct lending to industry by nationalised banks would help as a stopgap measure for a couple of years, until these banks can again be privatised, when legislation is in place to let banks operate under credible supervision.
A nationalised banking sector is not necessarily incompatible with a successful market economy as the experience of Taiwan and South Korea during their years of double-digit growth demonstrates. The current structure of ownership in Europe is only conducive to prolonging the nightmare that worries us all.
SP Chakravarty
Bangor, Gwynedd• Surely, the logical conclusion to Simon Jenkins's article, which was reinforced by the arguments in Austin Mitchell's letter (Letters, 16 May), is that Germany should be the one to leave the euro, not Greece or the other "southern European economies". When is someone going to argue that Germany's current financial strength is not simply a result of its industrial model, but also arises from the competitive advantage it obtains by being in the eurozone. If Germany was to leave the euro and readopt the deutschmark, the deutschmark would go through the roof and the German economy would become less competitive at a stroke, not only against the other members of the euro, but also against most other currencies, including the pound and the dollar. It would appear Mrs Merkel wants to have it both ways, austerity for everyone else, resting on Germany's export success as a result of a weak euro, not an inherently superior productivity.
Fred Pickering
High Peak, Derbyshire• Greeks complain they are losing their sovereignty to a German economic "diktat". It would not be the first such loss of control over the nation's finances. In 1879, following Greek military adventures and financial mismanagement, an international financial control commission was appointed. This had representatives from Britain, France, Russia, Germany, Austria-Hungary and Italy. It took over the running of Greece's finances. The commission collected revenues from state monopolies like salt, tobacco, stamps etc, and collected import duties at the port of Piraeus. Would this be worth repeating?
Peter Fraenkel
London• Your reporter (This is not a quarrel in a faraway land, 17 May) speculates on the consequences of a "Grexit". Presumably this includes the possibility of a Spexit and, in a worst-case scenario, a Frexit. I look forward to being updated by your Guarnalists.
Alan Davis
St Austell, Cornwall• In Latvia last December we were interested to find both lats and euros were able to be legally used. Why not drachma and euros for Greece? Most of the world has been able to use both dollars and local currency as alternatives for years. Pound and euros could even help our own trading with continentals.
Professor Colin Leakey
Lincoln• Larry Elliott et al are right ($1,000,000,000,000, 17 May), if only the EU could find another three caryatids as strong as Angela Merkel to support all that capital, Greece could stay in the eurozone.
Syd Caplan
Cricieth, Gwynedd
Letters: Greece and the trillion-dollar question | World news | The Guardian
