‘I don’t imagine my fellow Greeks would like to risk leaving the euro zone.’

Washington Post
November 3, 2011

The political situation in Greece remains incredibly unstable and in flux. But for the time being, the most likely path forward looks like it won’t involve a Greek referendum on the European bailout package. Instead, Greek Prime Minister George Papandreou is said to be working on a coalition government that could accept the bailout, no popular vote required.

Economist Michael Arghyrou has been writing extensively on the Greek debt crisis from his post at Cardiff University in Britain. Today he headed to Greece and, in an interview from Athens, he shared his perspective of what things look like on the ground, how a coalition government could help create stability and what a Greek exit from the euro zone would mean. What follows is a transcript of our discussion, edited for length and content:

Sarah Kliff: What’s the feeling on the ground in Athens right now?

Michael Arghyrou: What feels most likely right now is we’re going to see elections, and that will happen in the next 20 to 30 days. From those elections, I’d expect there will be no single party government, so we’ll have a coalition government. It’s still not very clear what will happen if the prime minister loses the vote of confidence tomorrow, whether his party will remain united. There are some who seem willing to form a coalition with the center right.

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