Europe's Trojan horse Project Syndicate

This will make it possible for the Greek government to service its debt. The markets will settle down. The longer-term consequences will not be savoury, but they will be problems for another day.

Some will say that the fatal mistake was allowing Greece to adopt the euro in the first place. That the country was unprepared should have been clear. Its fiscal policies were already out of control when it joined the monetary union in 2001, and its trade unions were agitating to push wages up to European levels, despite lagging productivity.  But this answer is too simple, given that such signs of dysfunction are not limited to Greece. Spain, with its 20percent unemployment rate and exploding budget deficit, sees in Greece an image of its own future. Or, if it doesn't, the markets do. Portugal and Italy are little better.