“A communist in a Burberry scarf” does not sound like an attractive candidate to govern a nation’s finances. However, this is the image Yanis Varoufakis, Greece’s finance minister, has projected to the European Union and the International Monetary Fund. His economic policy is pitted against his polar opposite, German finance minister Wolfgang Schauble, a politician with a conservative demeanor, years of experience and a hard pro-austerity stance.

As Greece’s bailout, the aftermath of its near-default years ago, was set to expire, the two economic heavyweights had to come together to negotiate a loan extension, as well as the Greek policy restraints that would come with it. As many analysts predicted, Germany and its European Union allies won out, forcing the Greeks to submit a detailed plan of continued austerity measures, severely reducing budget deficits in order to pay out its debts, currently at 175% of its GDP.

Although fiscal restraint in an at-risk economy is necessary, the European Union, led by center-right Germany, has taken the deal too far. The way to fix a struggling Greece is to meet Varoufakis in the middle and begin to rebuild the nation’s economy, not destroy it all over again.

Most troubling about the Greek bailout are not the fiscal measures, but the monetary side effects. As fear of a default mounted in Greece, depositors began to withdraw from banks, stripping the nation of its capital and liquidity. Without a solid banking system, Greece is right back where it started: stuck, confused and broke. It is not rational to expect a country that is being pushed into a bank collapse to repay its debt, let alone operate its government. The EU complains that Greece can only operate with emergency funding, but the EU is causing this problem by pigeonholing the Greek economy. If Greek banks are pushed into insolvency, they will be forced to exit the Eurozone, causing an even bigger headache for global financial institutions.

On a simpler level, Greece’s economy simply cannot function under complete austerity. In a nation like Germany or France, multinational corporations can help pick up the slack if government funds are tight. They may suffer hits, but they have global business to keep jobs in the economy. Greece, however, relies mainly on small, independent businesses. These businesses are reliant on the individual government of their home country and, most importantly, more vulnerable to local financial and economic conditions. Austerity is preventing the government from carrying out basic licensing and tax policies that keep businesses afloat.

Greek debt is a catch-22. While Germany and the EU want to make sure Greece carries out appropriate reforms, their tactics to do so are strangling the Greek economy. However, Greece’s idea of a heavy-spending leftist government will only catapult the economy further into crisis. Neither polarized side has the answer. Instead, policies must take a middle-ground economic approach. While Varoufakis may be wearing a Burberry scarf, the citizens of his country are wearing local imitations, and the German finance minister, used to a multi-national, globalized economy fails to take this into consideration when making such drastic cuts.

Julia Cohen is a SESP sophomore. She can be reached at [email protected]. If you would like to respond publicly to this column, send a Letter to the Editor to [email protected].