Hear the mouse roaring.

“Greece has turned a page. Greece leaves behind catastrophic austerity, it leaves behind fear and authoritarianism. It leaves behind five years of humiliation and suffering.”

That was Alex Tsipras, the 40-year-old head of the left-wing anti-austerity party Syriza, which won a resounding victory on election night on Jan. 25.

Decades ago, in the cold war, The Mouse That Roared was a satirical little film about a backward little country in Europe, the Duchy of Grand Fenwick, that bumbled into prosperity by playing off the battling superpowers of the time.

Greece is now the little country in Europe hoping to play off the different countries of the eurozone to shrug off its enormous debt load and stumble back to a semblance of prosperity.

In one corner, the paymaster – Germany, with its leader, Angela Merkel, preaching her homilies of the good German housewife who never spends more than the family earns.

In the other corner, France and Italy, with flatlining, even contracting economies after years of struggling to be good German housewives. The result, across the eurozone, is the risk of deflation and the European central bank beginning "quantitative easing" — a fancy term for printing money — in a desperate effort to refloat the sinking ship.

Growth first?

France and Italy lead the calls for a relaxing of austerity in the eurozone and a return to Keynesian deficit spending to get the continent out of the economic morass. Significantly, French President François Hollande and Italian Prime Minister Matteo Renzi quickly congratulated Tsipras.

Greece elections

Alexis Tsipras's populism and anti-austerity rhetoric helping his Syriza party win the Greek election on Jan. 25. (Michael Kappeler/EPA)

Hollande expressed his "desire to pursue the close cooperation between our two countries in the service of growth and stability of the euro zone.” Note that: growth first.

No country has suffered from austerity as much as Greece. Its economy has contracted by 25 per cent, its unemployment rate is 25 per cent. Youth unemployment is nearly 60 per cent, a third of the country lives below the poverty line. Its debt stands at 175 per cent of its national output.

The pain has been enormous and, despite the assurances of the international experts and bankers, has been deeper and gone on far longer than they predicted.

To be sure, Greece got itself into the mess by cooking the books – falsifying the national accounts to mask a large debt load – to get into the eurozone more than a decade ago, and then gorging on loan money that left the country all but bankrupt when the crash hit in 2008. 

Like a penitent prodigal, Greece agreed to swallow the bitter medicine. That was then. Now the mouse has turned.

The eurozone's evolving 'story'

Tsipras has sworn to reduce the Greek debt mountain by simply refusing to pay and getting outside creditors to write off most of it. He has also told exhausted voters his government will bail them out by raising the minimum wage, restoring electricity to those who have been cut off and providing health care for the uninsured.

It sounds almost pie-in-the-sky. But listen to Angela Merkel, just last week: “I want Greece, despite the difficulties, to remain part of our story.”

That’s the story of the eurozone. But at the same time, she said Greece had to pay its debts. And offstage, her officials were hinting that if Greece fell out of the euro, it wouldn’t be a huge crisis.

Greece Election

Many Greek voters were moved by Alexis Tsipras's message that a Syriza win would mean an end to the 'humiliation' of austerity measures imposed by eurozone countries like Germany. (Fotis Plegas G./Associated Press)

Taken together, that’s about as economically contradictory as Tsipras's populist offerings.

The fact is, none of Europe’s leaders, from Tsipras to Merkel, know what will happen next. For example, despite many predictions to the contrary, the euro's first reaction to the Greek election outcome was to rise slightly, not fall, against the U.S. dollar and the British pound.

That hardly lays the groundwork for a long-term solution. Better, many economists and some politicians are now saying, to slash Greece’s debt – write off a huge chunk as worthless paper. After all, they say, that’s what the Allies did with half of West Germany’s debt in 1953.

And the result was the "Wirtschaftswunder," Germany’s economic miracle as it rebounded from the ashes.

Anti-austerity sympathizers

Merkel and her people don’t want to hear about it. German voters are already fed up with paying for what they see as a rancorous and ungrateful small country to bail itself out. More important, a debt deal would send a signal to anti-austerity forces in neighbouring countries to clamour for a similar deal.

Spain, in particular, faces elections in the fall. Like Greece, it has gone through searing economic pain, and like Greece, it has a fierce anti-austerity party, Podemos, whose stock is rising steadily in the polls. It’s the German housewife’s nightmare.

In two weeks, Greece’s newly elected prime minister will meet other European leaders for the first time. He promises he will refuse to wear a tie, just as he will refuse to knuckle under to the existing austerity regime imposed by Europe and the International Monetary Fund. In the corridors, he may get whispered encouragement from officials from France, Italy and Spain.

It’s a poker game; the Germans want to win and they are vastly more powerful. But the Greeks, led by Tsipras, feel they have nothing left to lose.

In the fairy-tale film, the roaring mouse of the Duchy of Grand Fenwick lived happily and prosperously ever after.

The fate of the raucous rodent of today’s Europe is far less certain.