Greek State and Official Europe

: In 2010, the Greek state became insolvent, according to The Guardian. Two options consistent with continuing membership of the eurozone presented themselves: the sensible one, that any decent banker would recommend – restructuring the debt and reforming the economy; and the toxic option – extending new loans to a bankrupt entity while pretending that it remains solvent. Why, against common sense, against the IMF verdict and against the everyday practices of bankers facing stressed debtors, do they resist a debt restructure The answer cannot be found in economics because it resides deep in Europe labyrinthine politics. Official Europe chose the second option, putting the bailing out of French and German banks exposed to Greek public debt above Greece socioeconomic viability. Keen to avoid confessing to parliaments that taxpayers would have to pay again for the banks by means of unsustainable new loans, EU officials presented the Greek state insolvency as a problem of illiquidity, and justified the bailout as a case of solidarity with the Greeks. A debt restructure would have implied losses for the bankers on their Greek debt holdings. (news.financializer.com). As reported in the news.