Douglas Carswell

Greek poll won't change the laws of maths

Unless it is somehow able to change the laws of mathematics, the Greek referendum this weekend will not change the fundamentals.

This weekend Greece is being asked to vote to approve or reject the creditors demands. Pro Brussels pundits are lining up to cheer on a "Yes" vote.

Yes or No will not change the fundamentals.

Greek debts are now growing faster than Greece's ability to repay them. Only yesterday the IMF was talking about another €50 billion overdraft increase.

Maths means that Greece's debt to GDP ratio is only going to go one way - unless Greece defaults on the debt. No poll or politics can change that.

A Greek default means repaying creditors in a post-Euro Greek currency. It means higher taxes in Greece, most notably inflation tax, where by government prints too much money in order to transfer wealth from citizens to the state. It is not a case of wanting any of this or not wanting it. It is what will come to pass.

Greek governments have lived beyond the means of Greece taxpayers. They have done so for many years, and they were able to do so because European monetary union allowed Greek governments to borrow far in excess of what was sensible.

The poll this weekend cannot change any of that. It merely influenced how long this sorry saga must play out ahead of a default and abandonment of monetary union with the rest of the EU.

Greece might be the first Western state in modern times to have discovered that you cannot live forever beyond your means. She will not be the last.

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