Despite the pain it presages, Sunday’s overwhelming “no” vote at least leaves little doubt about where the Greeks stand. Greeks have rejected Europe’s latest bailout offer even after experiencing a taste of the ugly potential consequences of doing so—capital controls, limited ATM withdrawals and a banking crisis. Now they will have to live with those consequences.
It’s true the Greeks were given two bad choices, but they still chose the worst. Europe was offering more money to forestall a crisis in return for pension cuts and other reforms. Greek Prime Minister Alexis Tsipras claimed a “no” vote would help him extract better terms—by which he means even higher growth-killing taxes in return for fewer pension cuts. The Greeks chose the Tsipras ultimatum strategy, so they can’t blame the Germans for what comes next.