By Viktoria Dendrinou And Marcus Walker
ATHENS--In Greece's July 5 referendum, as currently planned,
voters will be asked to vote "no" or "yes" on a convoluted question
about the country's creditors' conditions for further bailout
aid.
How voters make sense of the ballot question could be decisive
in determining the outcome. The referendum campaign so far is
largely a contest to define the meaning of the question.
Prime Minister Alexis Tsipras and his left-wing Syriza party are
seeking to convince Greeks that a "no" to creditors' proposals
would safeguard national dignity and strengthen Athens's bargaining
position for the next round of negotiations, without triggering an
exit from the euro.
Opposition parties and foreign creditors, including the German
government and the European Commission, are telling Greeks that
they will be saying "yes" or "no" to Europe and its common
currency.
The ballot paper is one of the more challenging that has ever
been put to an electorate.
It reads: "Should the outline of the agreement submitted by the
European Commission, the European Central Bank and the
International Monetary Fund at the Eurogroup of 25/06/15 and is
made up of two parts which constitute their unified proposal be
accepted," before naming two documents written by those three
institutions from bailout negotiations in Brussels that broke down
last Friday.
The first document referred to on the ballot lists the fiscal
austerity measures and other economic overhauls that creditors
wanted Greece to enact under its EU-IMF bailout program, the
European part of which expired at midnight on Tuesday. The second
document is the institutions' "preliminary debt sustainability
analysis," a regular feature of Greece's five-year bailout in which
lenders try to predict Greece's debt trajectory assuming various
scenarios.
The documents are replete with economic data and technocratic
jargon. The government has posted Greek translations of the
documents, originally written in English, online.
The creditors' proposals are strictly redundant, since they were
supposed to be the basis for an agreement to extend Greece's
previous bailout program beyond Tuesday. Since Tuesday has passed,
the European program has lapsed. (The IMF's program continues until
early 2016.) But European officials have said that any new bailout
for Greece would involve substantially the same economic-policy and
financing conditions.
Those conditions are the heart of the dispute between Mr.
Tsipras's government and the lenders. Europe and the IMF want
Greece to hit ambitious fiscal targets via a mix of spending cuts,
including to pensions, and tax hikes. Athens wants to rely far more
on tax increases while protecting pensioners. Greece--with support
from the IMF--also wants more significant debt restructuring than
other eurozone governments are willing to grant.
The consequences of a "yes" or "no" on July 5 are as murky as
the question.
A majority for "yes," in the face of the Greek government's
appeal for a "no," would probably lead to Mr. Tsipras's
resignation, most analysts say. Mr. Tsipras himself has hinted that
he might resign in such an event. It is unclear what would happen
next. Fresh elections might be called. The parties in the current
parliament might try to assemble a bipartisan coalition under a new
prime minister. A new government might try to negotiate a new
bailout deal with Europe.
Germany and other lenders would press the new government to sign
up to their conditions quickly. Greece faces large repayments on
bonds held by the ECB on July 20 and Aug. 20. Failure to pay those
debts would make it very difficult, although not impossible, for
the ECB to continue financing Greece's paralyzed banking
system.
A "no" victory on Sunday would keep Mr. Tsipras in office for
now, but could put Greece on a path toward default and exit from
the euro. Mr. Tsipras claims it would help him to negotiate. Berlin
and other lenders would probably be in no mood to start new
negotiations.
Greeks will be able to vote between 7 a.m. and 7 p.m. on Sunday.
Exit polls are expected to be published as soon as voting ends. The
projected results are expected to become increasingly accurate as
counting progresses. The world should have a good idea of the
outcome within two or three hours of polls closing, unless the
result is very close.
Costas Paris contributed to this article.
Write to Viktoria Dendrinou at viktoria.dendrinou@wsj.com and
Marcus Walker at marcus.walker@wsj.com