I agree with the first part: the bailout package so far has failed, which is not a huge surprise. An interesting aspect has been that, more or less, the America

I agree with the first part: the bailout package so far has failed, which is not a huge surprise. An interesting aspect has been that, more or less, the Americans were right on this one: American economists thought the plan's projections were unrealistic and that significant GDP contractions were more likely. The ECB had very rosy projections about the economic growth that would be follow on very soon after the austerity program (within 1-2 years), which were not really in keeping with reality. I'm not sure I agree with the who-benefits part in the last bit, though. As an explanation of the 2010 bailout, protecting the bondholders has some truth to it. But by now that has mostly already happened: the bailout package shifted most of the debt held by the private sector (mostly German and French banks) to the IMF and ECB's books. That is one reason that Greece's negotiating hand is worse now. At that time they had a mutually-assured destruction angle, because the bailout was necessary to bail out the German and French banks. Greece did a poor job playing that hand, agreeing to a package that successfully bailed out the German and French banks (with EU, ECB, and IMF money) but without even plausibly solving the problem on Greece's end. What's the motivation now? It could be to protect the remaining bondholders (basically, the "troika"), but realistically even they cannot believe they will actually receive payment in full, so their interest can't be rationally protected by simply demanding it. In my opinion, the motivation is more driven by two political constraints: 1) Europe is in a national-populist mood, and other countries' politicians have their own domestic voters to worry about. Parties like True Finns, Alternative for Germany, and Dansk Folkeparti exert significant influence (in the case of True Finns, within government), and their line is "tough on foreigners" and euroscepticism. 2) The EU & ECB don't want to admit that their economic policy in this case has been poorly designed, so there is a bit of saving-facing stubbornness going on. (The IMF by contrast has come close to admitting a policy rethink is necessary, though not officially.)