We economists empasise in introductory economics that there is no such thing as a free lunch. Greek lunch may become very expensive, if current EU standards are applied.
The text below is from eurointelligencde. Enjoy it:

EU wants to put Greece on a short leash

FT Deutschland reports this morning that the EU wants to install a permanent supervision of the Greek budget, so that every deviation from the plan would have to compensated by some other measure. The Commission has serious doubt about the sustainability of the Greek plan, and fears setbacks. The strategy is now to signal to Greece that any such setbacks would have to be met by additional savings. The Commission will decide on Wednesday to recommend significant cuts in public sector wages. The report also says that Germany continues to be reluctant to agree to a bailout in principle, fearing that this would be misunderstood by the public, that tough measures could be avoided.

Greece should call the IMF

Jean Pisani Ferry and Andre Sapir write in the FT that the best way of action for Greece is to call in the IMF. The reason is that even if the eurozone manages to get the necessary funds together there is no way the Europeans can provide the same standard conditionality and credible monitoring process. Also would eurozone countries stay in line amid rising anger in the streets of Athens? Would the eurozone be prepared to do the same for larger member states? The authors warn that there is a real danger that the EU package is not renegotiation proof. Rather than embarking on a risky course, EU heads of states should urge Greece to call the Fund now. (What it says is that there is no way that we can credibly fix the institutional requirements for a eurozone bailout. How depressing is this..)

The European bailout comes for sure

Pierre Briancon from Breaking views writes in Le Monde that a European bailout will come no matter what although investors still refuse to consider a European bailout as an option. Instead they continue to demand higher spreads on Greek bonds, a rally that is likely to continue until the heads of states meet in February. But the Greek tragedy is easily to turn into a eurozone one, as investors increasingly also seek reassurance from other member countries that they will be capable of consolidating their public finance.

Lefteris N. Botsas, Ph.D.
Professor Emeritus
Oakland University
Rochester, Michigan, USA