The crisis of the euro zone has finally hit the potholed road of real politics, with the Greeks now openly questioning whether their commitment to Europe and its single currency still matters more to them than control over their own future and economic well-being.

During the two-year financial crisis, the wealthier countries of northern Europe, led by Germany, have insisted that their heavily indebted brethren in the south radically cut spending in return for emergency loans. They have stuck to that prescription even though austerity has undermined growth and increased unemployment in Greece, Spain, Portugal and now Italy, betting that people in those countries will swallow the harsh medicine because their only alternative is to default and possibly leave the euro zone altogether.

The turmoil in the government of Prime Minister George A. Papandreou means that Greece is about to call that bet. Many Greek politicians appear to be calculating, at this late stage, that they have more to lose by sticking to Germany’s terms than by risking a messy default, and even going it alone with their old currency, the drachma, outside the euro zone.

Read it all.

Filed under: * Economics, Politics • Economy • Credit Markets • Currency Markets • Euro • European Central Bank • G20 • Stock Market • The Banking System/Sector • The Credit Freeze Crisis of Fall 2008/The Recession of 2007-- • The U.S. Government • Federal Reserve • The United States Currency (Dollar etc) • Treasury Secretary Timothy Geithner • Foreign Relations • Politics in General • * International News & Commentary • Europe • --European Sovereign Debt Crisis of 2010 • France • Germany • Greece

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