Papandreou to the EU: let my people vote

Israel's Labour Party, (like the EU in this case) well aware of what the public would say if it went to a referendum, instead took it to the floor of the Knesset on 23 September 1993 where after only two short days of discussion the game changing approach to Middle East peace, scraped a mere 61 votes from a legislature of 120.

It is a fact that a key reason why citizens in Israel and the Palestinian Liberation Organisation (now rebadged as the Palestinian National Authority) are untrusting of their leaders is primarily because such a potentially calamitous change in architecture of Middle East politics was presented to them as a fait accompli. No consultation with the workingmen and women. No referendum. Nothing.

Were the Israelis and Palestinians leaned on by external powers to agree with each other and not consult with their electorates? Who knows? And if not, then clearly both Israel's Labour party and Mr Abbas' leadership acted with wilful deceit of their respective people. The legacy of which still pollutes any meaningful peace process.

Prime Minister Papandreou surely learnt the lessons of the Levant.

Papandreou's decision could on the other hand be just a negotiating ploy to wrangle more money out of the EU. Recognising that Brussels is petrified of a Greek default, which could bring about the collapse of the entire eurozone, he could now be milking popular anger in Greece at the imposition of austerity measures to win an ever-bigger bail out.

Or maybe Papandreou knows that he is caught between saganaki and crusty bread and wants to rest the responsibility for change on the heads of his citizens.

If he manages to last long enough to hold the referendum, he will be a winner or sorts. Regardless of the result. At least he cannot be branded as a stooge for Berlin, Paris, Bruxelles or Washington.

The EU insists that the Greek parliamentary vote on the bail-out must precede a referendum. Thereby neutering the point of the referendum.

The referendum will decide if Greeks want to live with the consequences or accepting or rejecting the EU lifeline.

If Hellenes give the bailout a resounding raspberry, then a default will follow. And soon after the Drachma will rise again.

Greece will peg the Drachma as a fraction of the Euro; slowly unwind its obese public sector; slowly deflate wages; lift the retirement age above the current 49; clamp down on entitlements and privatise a few key state assets. Oh and paying annual income tax will become a fact of life, unlike now where it's whole lot of fiction.

The referendum may be the starting point of a gradual orderly exit from the euro.

Staying within the eurozone but having Greece's economy planned by some boffins in Bruxelles and financed by bankers in Berlin will lead many Greeks to conclude that being a democracy is impossible while they remain members of the eurozone.

In short order if not already it will dawn on the Greek people that the price of freedom is an exit from the euro.