It’s only a matter of time. The European Council may have reached its last-minute deal to avert a Grexit this month—with the certain calamitous consequences for Greece and the rest of Europe this would have entailed—but the damage has been done. This past week has to have been the worst ever in the 65-year history of the construction of Europe. What has happened is a disaster for Europe—for the idea of Europe, if that still means anything. Arthur Goldhammer is right in saying that “the euro [may be] saved, but the euro, it is now clear, is going to be a thorn in Europe’s side if not a spike in its heart for years to come.” How can it not be, with people like Wolfgang Schäuble and Jeroen Dijsselbloem all but calling the shots? Of course the successive governments in Athens have been hugely responsible for what has happened but still, who do the f*cking Finns and Slovaks think they are to lecture the Greeks and threaten them with expulsion from Europe? Who the hell does Alexander Stubb think he is to be reading the riot act to anyone outside his little country? And for the big country in Europe—Wolfgang Schäuble’s—to be humiliating a member EU state—or any state, for that matter? Art Goldhammer nailed it again
[The deal] was nothing less than a humiliation of a small and suffering member state, a sadistic display of naked financial power. Do as we say or we will “collapse your banks,” Eurogroup Chairman Jeroen Dijsselbloem had apparently told Greek negotiators earlier. In the climactic weekend it emerged that he wasn’t bluffing. Despite the fact that the ‘No’ vote had scored a resounding victory in a national referendum a week earlier, Greek Prime Minister Alexis Tsipras decided he had no choice but to surrender to all the creditors’ demands, but in the end it turned out that even unconditional surrender was not enough.
Germany’s implacable finance minister, Wolfgang Schäuble, saw weakness in his opponent and went for the jugular. He insisted on “guarantees” that Greece would keep its word, including sequestration of Greek assets in a fund under his control. No such guarantees had been demanded previously, but now Chancellor Angela Merkel, who had previously seemed less exigent than Schäuble, declared that Greece had forfeited the “trust” of its European partners. In the end she proved to be a good German but not a good European.
As for what happened in Brussels last night, the FT thus reported
“They crucified Tsipras in there,” a senior eurozone official who had attended the summit remarked. “Crucified.”
Wolfgang Münchau has an awesome FT tribune today, “Greece’s brutal creditors have demolished the eurozone project.” No money quotes, as the whole piece is one. Just read it. All of it.
This social media comment by Yascha Mounk, a recent Harvard Ph.D. who teaches political theory in the Government Dept there (and who’s German)—no doubt reflects the sentiments of many
It’s strange to think that, back when I was a teenager, the European project still seemed like the kind of thing to which one might nobly devote one’s life. But the European dream is dead—not just because of Greece, but because of the depth of nationalism the euro crisis has revealed, and the ugly hatred it has incited.
The best we can now hope for is an orderly slimming of the EU to its key achievements: free movement of people, coordination on the most important regulations, etc. (I deliberately exclude political values: as the case of Hungary shows, the EU is incapable of safeguarding those in any case.) But the centrifugal forces, and the strength of the populists, will be such in the next years that we may wind up losing even that.
Again, the posture of Germany and its little country allies may have killed the European idea. As for big country France, I shudder in anticipation of the coming public opinions polls on attitudes toward Europe. Revulsion is all but guaranteed. And in polls outre-Manche, Brexit will no doubt leap.
It’s now beyond doubt that the euro has been “a curse,” as retired longtime Christ Church, Oxford, economics professor Peter Oppenheimer asserted recently.
N.B. the euro, not Europe; not the European idea. The problem is not the Treaty of Rome or even the Single European Act; it’s Article 109 of the Maastricht Treaty, and all that ensued from that.
The Telegraph’s Ambrose Evans-Pritchard, in a comment entitled “Greek deal poisons Europe as backlash mounts against ‘neo-colonial servitude’,” weighs in on the deal. E.g.
“Greece has been devastated and humiliated. Europe has showed itself Pharisaical, incapable of leadership and solidarity,” said Romano Prodi, the former Italian prime minister.
An independent fund will take control of €50bn of Greek state assets, collateral to prevent Syriza reneging on the deal at a later date. Three-quarters of this will be sued to recapitalise the Greek banks and repay debt.
International inspectors will have the power to veto legislation. The radical-Left Syriza government will be forced to repeal a raft of laws passed since it took power in January, stripping away the last fig leaf of sovereignty.
“It is unconditional surrender. We get serious austerity with no debt relief. We will have foreign supervisors crawling over everything,” said Costas Lapavitsas, a Syriza MP and one of 40 or so rebels who plan to abstain or vote against the deal, mostly from the Left Platform.
“They are telling us that from now on, they are going to govern the country…”
In the plan is a provision for ending laws against Sunday trading. Rhetorical question: What does having stores open on Sundays have to do with economic growth and/or reimbursing national debt? Concrete question: Are stores in Germany open on Sunday? Answer here.
Back to Ambrose Evans-Pritchard, TWS senior editor Christopher Caldwell, in a piece on Greece in the latest issue—in which valid points are mixed with Eurosceptic pablum and other silliness—writes this
Ambrose Evans-Pritchard of London’s Daily Telegraph has therefore asked whether we are right to focus on Greece at all. Evans-Pritchard is a conservative writer whose well-informed essays on European finance are a bracing contrast to the conservative sloganeers in the United States, who often write as if the virtuous party in any dispute were always the one with the most money. “The currency union itself is delinquent,” Evans-Pritchard asserts. He is right. Greeks could borrow what they did because they were now members of a rich family. If Brad Rockefeller walks into a casino in a soiled T-shirt and runs up a million-dollar debt that neither he nor his family will repay, what was the casino’s mistake? Trusting some T-shirt-wearing guy or trusting the Rockefellers?
In the Paris business daily La Tribune, Romaric Godin asserts that “La défaite de la Grèce [est] la défaite de l’Europe.” Disheartening reading but necessary. See also Godin’s piece from last Friday—an eternity ago—”Grèce: où Alexis Tsipras veut-il en venir?”
I’ve been ranting here but so be it. I’m really quite dismayed and dejected about all this.
I, too, am disheartened. Greek people voted. Finance ministers didn’t like the way they voted so they made the new deal even worse than the previous one. It’s maddening, unfair, completely unreasonable.
I’m a pro-European but the way we’ve treated Greece is disgraceful. I was one who voted “yes”, even in 2005. I really believed in the idea of Europe, although it’d been shaken by the dithering over the Balkans. The situation in Hungary started chipping away at my convictions. Today, I feel sadness thinking of how proud I was of singing the European Anthem. The Eurozone has proved it’s not democratic, just a bunch of tyrant-technocrats, and I hate them for what they’ve done to the ideal I held.
Frankly, if I were Greece, I would say Screw it, let’s leave and see how *they* like it.
MYOS: On the EU’s lack of response to the situation in Hungary, the culprit is the European People’s Party in the European Parliament, of which Victor Orban’s Fidesz is a member. If it weren’t for the EPP and its constituents (German CDU, French LR etc) shielding Orban from eventual EU action, perhaps action would have been taken by now.
As for Greece leaving the Eurozone, i.e. doing the Grexit and out of spite, there are at least four problems with this: (a) The Greeks – people and government – do not want to do this, (b) Greece has made no preparations for such an eventuality, (c) A Grexit would have disastrous consequences for the Greek economy (and thus the Greek people in their overwhelming majority), and (d) The Germans would be so happy with such an outcome, so the spite side of it wouldn’t work.
Glad to see your anger Arun, People of goodwill will surely endorse your view about the damage all this monstrous mauling has done to decades of work on European cooperation. Germany’s leaders have seriously overplayed their hand, seemingly believing Europeans have forgotten their history and this as the world commemorates the centenary of the outbreak of World War 1. German hegemonists once again, and for a third time, need putting back in their boxes. Hopefully the Greek people will reject the enslavement viciously thrust on them by the unloved Herr Schäuble. He of course is the man who while demanding financial probity of the Greeks, utterly fails to jail any of the identified Libor-swindlers at the world’s biggest finance house Frankfurt-based Deutsche Bank.
Arun, I think your points are on the mark. And now I have to use the democratic theory argument against the Tsipras government (after having used it previously to defend the referendum). Having held and won the referendum, the government should not have capitulated in the negotiations, and should have had the courage of democratic convictions with regard to leaving the Eurozone. Or so I think.
Erik: See my reply in the previous post to Frenchnews1online, in which I argued against the notion that the referendum was an exercise in democracy. As for Tsipras’s capitulation, this was in a negotiation in which he was bargaining from a position of extreme weakness. As for leaving the Eurozone, he had no mandate whatever from the Greek people to do this, as Greeks in their great majority (80% according to polls) absolutely do not want a Grexit.