Grexit: More bark than bite

It all sounds familiar. In the run-up to Greece's parliamentary elections in 2012, the left-wing Syriza alliance, led by Alexis Tsipras, was predicted to win. Tsipras demanded an end to austerity policies, a stance that earned widespread approval among the Greek population.

Spooked by this possible outcome, European politicians of widely varying denominations - such as German Christian Democrat Chancellor Angela Merkel, French Socialist President Francois Hollande and independent Italian Prime Minister Mario Monti - made a show of supporting conservative New Democracy candidate Antonis Samaras.

They warned that a left-wing election victory could lead to Greece's ejection from the single-currency bloc. It is difficult to determine the extent to which this threat influenced the election result. Then and now, it could have had an impact - but it could also have triggered a defiant response from voters.

In any case, the Syriza alliance could rejoice over a considerable rise in the number of votes in 2012, but only came in second. The task of building a new government fell to Samaras instead, and international backers' budget restrictions and reform requirements remained in place.

Eurozone braced itself

Today, fiscal consolidation policy is at issue once again. According to opinion polls, Syriza could well become the largest party in parliament in this month's election. But in contrast to 2012, the monetary union as a whole is no longer in danger.

If Greece actually left the eurozone and returned to the drachma, a domino effect involving one debt-ridden state after another would now be unlikely. The EU has since taken precautions to prevent such a scenario, including a banking union.

That is why politicians in Europe can discuss, in a fairly relaxed manner, the possibility of a Greek departure from the euro, whereas, at the height of the crisis in 2010, the German government saw no alternative to financial aid packages.

However, in the event of an exit or expulsion, creditors would have to write off their loans - something else no-one wants. Tsipras is therefore probably right when he claims that those who are raising their fingers in warning primarily intend to influence Greek voters.

'Grexit' a 'solution' for the AfD

Late last year, German Finance Minister Wolfgang Schäuble predicted "difficulties" if Greece discontinued its path of reform. Vice Chancellor and Economy Minister Sigmar Gabriel, a Social Democrat, told the "Hannoversche Allgemeine Zeitung" that Greece should stay in the monetary union, adding, however, that "we cannot be blackmailed."

Interestingly, the socialist leadership in the European parliament does not share Gabriel's view at all: " A hypothetical Greek exit from the eurozone is just not an option. Greece's membership of the euro is irreversible," parliamentary party leader Gianni Pittella said, exposing national differences. The EU Commission is also among those who have called Greece's membership in the euro currency club "irrevocable."

However, Bernd Lucke, chairman of the euroskeptic party Alternative for Germany (AfD), said a Greek exit would be "a good solution for Greece and the Eurozone."

France's Hollande walked a fine line, given that he has, time and again, opposed austerity policies. On French public radio, he reminded Greece to abide by its European commitments, and his seemingly neutral stance when asked about a possible departure from the euro hid a warning: "The Greeks are free to choose their own destiny," he said.

No special treatment

Yet, how likely is a "Grexit" from the monetary union? Would an elected Prime Minister Tsipras actually lead Greece out of the eurozone? At any rate, that is not his aim. European treaties make no provision for leaving the eurozone, only for complete withdrawal from the EU, which Tsipras has even less interest in. His primary concern is a resumption of financial aid for Greece - without budget restraints.

Creditors, of cource, would never accept loans without conditions. This would also be unacceptable to taxpayers, let alone other rescue candidates that abided by their commitments or are still continuing to do so. If Greece were offered concessions, they would demand them, too.

Accordingly, Germany's Elmar Brok, the leading Christian Democrat in the European Parliament, said on television that "Tsipras cannot expect to get all debts cancelled without enacting further reforms."

Agreement likely

During the recent debate, Tsipras already backpedaled: Initially he had pledged to terminate all EU conditions unilaterally. Now he wants to "negotiate" with creditors and adopt unilateral measures only if "we are forced to take those steps," thereby, in the eyes of Greek voters, passing the buck to the creditors.

It appears most likely that, in the event of a Syriza election victory, creditors will grant Greece more favorable repayment terms once again - extended deadlines, for instance - which have also been mentioned by Olli Rehn, former EU commissioner for economic and monetary affairs, in an interview with "Der Spiegel" newsmagazine.

However, such a step could only come in the wake of "tough" negotiations - which would not be the first - enabling all sides to save face. Tsipras would be able to tell his voters that he achieved something to their benefit, whereas creditors could assert that the basic conditions remained untouched.

After all, all the parties involved have an interest in preventing more political and financial turmoil for the monetary union.