To recap, Greece can’t pay all the money it owes to foreigners and unlike Italy even if Greece stiffed all its creditors it still wouldn’t be close to balancing its budget. Consequently, if Greece’s creditors want to see Greece inflict fiscal austerity measures Greece has no choice but to implement austerity. They can implement forced austerity when they’re cut off from foreign credit markets, or they can accept EU/IMF largess and accept getting bossed around. So far they’re getting bossed around, and they don’t like it very much:
Greece’s largest police union has threatened to issue arrest warrants for officials from the country’s European Union and International Monetary Fund lenders for demanding deeply unpopular austerity measures. […] “Since you are continuing this destructive policy, we warn you that you cannot make us fight against our brothers. We refuse to stand against our parents, our brothers, our children or any citizen who protests and demands a change of policy,” said the union, which represents more than two-thirds of Greek policemen. “We warn you that as legal representatives of Greek policemen, we will issue arrest warrants for a series of legal violations … such as blackmail, covertly abolishing or eroding democracy and national sovereignty.”
This is purely symbolic, but of course symbolism matters. In the United States I don’t believe that West Virginia has ever been anything other than the recipient of large, persistent, transfer payments from more prosperous portions of the country. The payments do, of course, come with some conditionality. Major programs like Medicaid and Title I education money and highway funding all have special requirements and so forth. But the governing understanding is that these are strings that the United States Congress as a whole attaches to states as a whole and not an incident of the powerful bossing around the weak. Still the fact of the matter is that we have some states that earn enough income to pay the tab for the pensions, schools, and health care of their citizens and a bunch of other states that don’t. Here in the USA, the ones that can pay the tab for the ones that can’t because that’s what it means to have a country. Liberals back high levels of taxation of rich people and high levels of spending on social services, and even though that de facto creates large place-to-place transfers it’s understood as an ideological dispute with conservatives not an example of New Mexico putting one over on Maryland. European politics isn’t like that, so things are going to keep getting very ugly.