Here both sides are to blame. Berlin is indeed overly fixated on austerity, just as Greece wants to live in a world where it can spend money like a drunken sailor. But it is only slow, painful, structural reform – particularly labour market and pensions reform – that can truly transform Greece and the rest of Europe; and that will take years. The best-case deal would be for the north to relax its obsession with the Greek primary surplus – allowing it to fall to around 1.5 per cent of GDP as Varoufakis wants – in return for iron-clad and non-negotiable commitments to structural reform over the next half decade.

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