How’s That Euro Workin’ Out?

By Daniel Hannan ~

Eurocrats are starting to realize, with a kind of horrified stupefaction, that Alexis Tsipras really means it. Their assumption had been that the new Greek prime minister, like other politicians, would be accommodated by the system. The EU, after all, is all about compromise, moderation, the postponement of difficult decisions. You rarely find black and white in Brussels; rather, a kind of sfumato, where lines are deliberately blurred, sentences balanced by two apparently contradictory clauses. It’s like inhabiting Ayn Rand’s Atlas Shrugged: Nothing is stated directly, everything elliptically.

Well, not this time. Tsipras, the narcissistic leader of the far-Left Syriza movement moved immediately to dispel any idea of compromise, telling his first Cabinet meeting that he would “not consent to a policy of submission.” Having fallen just short of an absolute majority, he was widely expected to form a coalition with one of the pro-euro, centrist parties, which might have allowed him to temper his demands. Instead, he reached a deal with a Right-wing nationalist party, which agrees with him only in its hostility to the austerity program and to the German government. Tsipras’ very first act as premier was to visit the mass grave of some Greek communists murdered by the Nazis – not exactly a sign that he values relations with Berlin.

For the first time, a break-up of the euro is starting to look possible. Not because it has been planned, but precisely because it has not been planned. These things tend to come about accidentally, as a result of bluffs and miscalculations. Both sides say that they want Greece to remain in the single currency; but neither is willing to meet the other’s terms. Tsipras calculates that the EU would prefer to cancel a chunk of Greece’s debt than to suffer a default, the bulk of which would be felt by its own funds (private banks have sneakily shifted almost all their Greek liabilities on to the EU over the past five years). Brussels leaders have said all along that the euro must be irreversible. Are they really prepared to sacrifice that principle for the sake of a country that represents less than two percent of the Eurozone economy?

Apparently they are. Greece has repeatedly won more lenient terms over the past five years – debt forgiveness, extensions and bailouts. Yet, from the EU’s point of view, every such concession simply prompts more hectoring demands. If Greece were able to walk away from a large chunk of its liabilities, why shouldn’t Portugal or Spain or Italy? At that stage, the euro really would be in danger of unraveling.

How has it come to this? In normal times and in a normal country, Syriza would be a joke party on the uttermost fringes of the Left. A coalition of Maoists, Trotskyists, eco-protesters and Occupy types, its fantasy manifesto promises a hike in pensions, a 50 per cent increase in the minimum wage, a massive extension of government healthcare, re-nationalization of key industries and the provision of free electricity for 300,000 households. Oh, and it expects the rest of the world to cancel Greece’s debts while it does all these things.

These, though, are not normal times and Greece is not, for now, a normal country. The euro has been an unmitigated disaster for the Hellenic Republic, inflicting upon it a worse recession than that of 1929-1935. A quarter of all Greeks – half of all young people – are out of work, and GDP has fallen by an almost unbelievable 26 percent since 2008.

In such a climate, Greeks have reached the view that it’s the traditional parties – the corporatist, pro-Brussels parties – that are the real extremists. Sure, Tsipras might have had a Che Guevara poster in his office (his son is named Ernesto after that bloodthirsty revolutionary); but, they reason, how can he be worse than the alternatives?

Other Europeans are making similar calculations. In Spain, Syriza’s sister party Podemos leads in the opinion polls. Podemos offers precisely the same child-like manifesto: debt cancellation, massive state spending, a 35-hour week, yada yada. (The party’s name can be translated as “Yes we can!” I wonder where it got that idea?) Spain, unlike Greece, is not a small economy. A default there really would spell the end for the euro.

The Brussels elites, needless to say, can’t bring themselves to blame the euro. Instead, they blame the voters. “There can be no democratic choice against the European Treaties,” said the President of the European Commission, Jean-Claude Juncker, on Thursday.

Don’t think that this is just rhetoric. In 2011, elected prime ministers in Italy and Greece were toppled in Brussels-backed civilian coups and replaced by EU functionaries in order to sustain the euro. The EU is not interested in how Greeks have voted. The only question for them is whether Greece can be kept within the monetary union, or whether amputation is the best way to secure the survival of the integrationist project elsewhere. We’ll know soon enough which way they have decided.

Stand back and look at the bigger picture. Rather than admit that the euro was a mistake, the EU has immiserated its Mediterranean members. The result is that the Greeks have just returned a Marxist party in first place and a Nazi party in third place. When the euro was launched, its supporters assured us that it would be an antidote to political extremism. As Sarah Palin might ask, “How’s that workin’ out?”

FamilySecurityMatters.org Contributor Daniel Hannan is an British writer and journalist, and has been a Conservative MEP (Member of the European Parliament) for South East England since 1999. He speaks French and Spanish and loves Europe, but believes that the EU is making its constituent nations poorer, less democratic and less free. He is the winner of the Bastiat Award for online journalism.

Read more excellent articles from Family Security Matters . http://www.familysecuritymatters.org/

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Tagged: Alexis Tsipras (Prime Minister Greece), EU (European Union), Euro, Euro Politics, Eurozone, FSM (Daniel Hannan), Greek Debt Crisis

Posted in: Economy, Europe, Greece, Leftists (In the USA aka as Liberals-Progressives), Politics, Power Hungry, Public Opinion