Looking at the wrong example
In the last few years a large number of people in Greece have suggested, often in passionate terms, that the solution to the country’s sovereign debt crisis would be a disorderly default. Amid a climate of such widespread populism, this point of view has gradually earned the support of a considerable portion of the Greek population. Both those who preach this absolutely catastrophic theory, however, as well as those who support it, ought to take a moment to have a good look at the case of Argentina, which default champions so often like to cite. The face is that the people of this Latin American nation – whose debt is significantly lower than that of Greece and which has many more resources – have suffered greatly for a large number of years from its default in 2001. The option of undergoing a disorderly default, whether as a means of blackmailing the country’s lenders or as vehicle for a supposed liberation from them, is a particularly bad solution.