Tony Blair has delivered a stark warning of a popular backlash against austerity policies in the eurozone ahead of this Sunday’s re-run election in Greece.
“You look at what the Greeks are being asked to accept: it’s beyond tough,” Mr Blair said in an interview with the Financial Times in Jerusalem.
The former long-standing UK prime minister, a self-professed pro-European, said the risk of unrest applied to Europe as a whole. “In the end, what people will ask is: ‘Is the single currency worth it if that’s what we’re being asked to accept’.”
Mr Blair’s said the remedy should be a “grand bargain” between Germany and the rest of Europe to rescue the single currency . This would involve a pooling of European debt and a new push for growth, matched by deficit reduction through pension and welfare reforms.
His intervention follows Spain’s request last weekend for a European bailout of its banks of up to €100 billion ($125.7 billion). Mr Blair acknowledged that commonly issued eurozone bonds or debt redemption would meet opposition in Germany, but the eurozone’s favoured policy of structural reform and fiscal austerity had run its course.
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