It could be the end, or a new beginning

In theory, it could still work. It only requires three miracles. Maybe the resounding “no” to the Eurozone's terms for a third bailout in Sunday's referendum in Greece (61 per cent against) will force the euro currency's real managers, Germany and France, to reconsider. French President François Hollande is already advocating a return to negotiations with Greece.

Maybe the International Monetary Fund will publicly urge the Eurozone's leaders to cancel more of Greece's crushing load of debt. last Thursday the IMF released a report saying that Greece needed an extra 50 billion euros over three years to roll over existing debt, and should be allowed a 20-year grace period before making any debt repayments. Even then, it said, Greece's debt was “unsustainable”.

Maybe Greek Prime Minister Alexis Tsipras will accept the terms. He asked Greek voters to reject in the referendum if he can also get a commitment to a big chunk of debt relief — say around 100 billion euros, about a third of Greece's total debt — from the Eurozone authorities and the IMF. It's all theoretically possible. It even makes good sense. But it will require radically different behaviour from all the parties involved.

Mr Tsipras has already made one big gesture: On the morning after the referendum victory, he ditched his flamboyant Finance Minister, Yanis Varoufakis. The hyper-combative Varoufakis had needlessly alienated every other Eurozone Finance Minister with his scattergun abuse, and it was hard to imagine him sitting down with his opposite numbers again after calling them all “terrorists” during the referendum campaign.

The IMF's gesture was even bigger, if much belated. It knew the Eurozone's strategy was wrong from the time of the first bail-out in 2010, and it is finally getting ready to admit it.Normally, when the IMF bails out a country that is over its head in debt, it insists on four things. There is always fiscal consolidation (cutting spending, collecting all the taxes, balancing the budget) and ‘structural reform’ (making labour markets more flexible, ending subsidies, etc). All the current Greece-Eurozone negotiations have been about these issues. But the usual IMF package also includes devaluation and debt relief.

Greece's debt is not decreased by these transactions: It is just switched to European official bodies including the European Central Bank So the Greeks are getting no real help worth talking about, and European taxpayers are getting screwed to save European banks.If the Eurozone authorities know that much of Greece's debt can never be repaid (which they do), why don't they just give Greece the debt relief it needsIJ Partly because Chancellor Angela Merkel knows that her own German voters will be angry at more ‘charity’ funded by their taxes, whereas they stay fairly quiet so long as the debt is still on the books. And partly because other Eurozone countries would see it as special treatment for Greece.

Italy, Spain, Portugal and Ireland have also been through harrowing bail-out programmes, and are still making proportionally bigger interest payments on their debts than Greece. Some other countries using the euro — Estonia, Portugal, Slovakia and Slovenia - have about the same gross domestic product per capita as Greece, and latvia is even poorer. They don't see why they should pay for Greece's folly in running up such huge debts.

“I really hope that the Greek Government, if it wants to enter negotiations again, will accept that the other 18 member States of the euro can't just go along with an unconditional haircut (debt write-off)”, Sigmar Gabriel, Germany's Vice-Chancellor, said. He added, “How could we then refuse it to other member StatesIJ And what would it mean for the Eurozone if we did itIJ It would blow the Eurozone apart, for sure.”