Some readers will remember I didn't get particularly excited the last
time there was a Greek crisis unfolding. I said thing would happen then
and I said nothing would happen now. Greece doesn't want out of the Euro
so Greece will fold at every turn. The reason why is because a return
to the Drachma is essentially a factory reset on the Greek economy which
leaves everybody bankrupt. Nobody wants that. As far as the EU
is concerned, they don't want it to happen because it damages the
reputational prestige of the Euro which hurts everybody - including us,
in or out of the Euro.
The reason it keeps coming to a crunch is that the Greek people display a certain political immaturity thinking that they can keep all the trappings of their bankrupt state machine without having to pay for it. Far from destroying the Greek economy, the Euro has saved it from itself. Without EU demands for political and economic reform, Greece would have collapsed years ago. It was bordering on a failed state already.
These occasional disputes are just a reminder that the EU could throw Greece to the wolves if they so wished and that reminder is why Greece keeps caving in. Paying up is better than any of the alternatives. The fate of the Euro does not rest on Greece. Greece is a tiny economy and Germany could buy Greece with pocket change if it so wished. To put it in perspective Volkswagon's turnover is similar to that of Greek GDP.
The fact it is viewed as a make or break critical issue is largely down to our infantile media, who enjoy a little bit of drama because politics is more for their entertainment than for our information. The subsequent noise just allows political opportunists to exploit it for their own narratives. After all, economists make a living by telling us things are about to imminently implode.
The left point to it as neoliberalist imperialism imposing austerity on Greece, but in effect, without reform of the endemic corruption and laziness that taints every corner of public life, Greece is done for - and cannot expect to be bailed out again without paying the piper. Germany has been asked to pay once, but there will be no mandate to do it again. Greece knows this which is why economics have triumphed over the sentiment expressed at the last Greek election.
This is why eurosceptics should be hesitant to use Greece as an example of anything. The EU isn't being beastly to Greece. In more ways than one, Greece is getting exactly what it deserves and if the EU, namely Germany, is to save it from extinction then they have every right in telling them how to run their basketcase economy.
There are many good reasons to leave the EU, but the EU's restructuring of basketcase economies is not one of them. We went through it in the 80's and we are much richer for it. Now Southern Europe is being dragged kicking and screaming into the new era. Britain should support the EU in that goal, but unlike Greece, we do not need the EU to tell us want to do, nor do we owe it anything.
The reason it keeps coming to a crunch is that the Greek people display a certain political immaturity thinking that they can keep all the trappings of their bankrupt state machine without having to pay for it. Far from destroying the Greek economy, the Euro has saved it from itself. Without EU demands for political and economic reform, Greece would have collapsed years ago. It was bordering on a failed state already.
These occasional disputes are just a reminder that the EU could throw Greece to the wolves if they so wished and that reminder is why Greece keeps caving in. Paying up is better than any of the alternatives. The fate of the Euro does not rest on Greece. Greece is a tiny economy and Germany could buy Greece with pocket change if it so wished. To put it in perspective Volkswagon's turnover is similar to that of Greek GDP.
The fact it is viewed as a make or break critical issue is largely down to our infantile media, who enjoy a little bit of drama because politics is more for their entertainment than for our information. The subsequent noise just allows political opportunists to exploit it for their own narratives. After all, economists make a living by telling us things are about to imminently implode.
The left point to it as neoliberalist imperialism imposing austerity on Greece, but in effect, without reform of the endemic corruption and laziness that taints every corner of public life, Greece is done for - and cannot expect to be bailed out again without paying the piper. Germany has been asked to pay once, but there will be no mandate to do it again. Greece knows this which is why economics have triumphed over the sentiment expressed at the last Greek election.
This is why eurosceptics should be hesitant to use Greece as an example of anything. The EU isn't being beastly to Greece. In more ways than one, Greece is getting exactly what it deserves and if the EU, namely Germany, is to save it from extinction then they have every right in telling them how to run their basketcase economy.
There are many good reasons to leave the EU, but the EU's restructuring of basketcase economies is not one of them. We went through it in the 80's and we are much richer for it. Now Southern Europe is being dragged kicking and screaming into the new era. Britain should support the EU in that goal, but unlike Greece, we do not need the EU to tell us want to do, nor do we owe it anything.
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