http://www.aljazeera.com/programmes/aljazeeracorrespondent/2012/11/2012111262426515410.html
Aljazeera correspondent Barnaby Phillips went to Greece in an attempt to figure out why there is so much tension between Greece and Germany. "Many Greeks blame the European Union, and Germany in particular, for the crisis they are in". When the Syriza party won the January 2015 elections, they promised that they would end austerity policies. With this promise, they sought to attack those who they perceived as the source of the problem: Germany. This is not a totally invalid conclusion seeing that Germany's promise to assist Greece financially came with many conditions. Syriza has pointed to Germany's own history of reparations and the damaging impact it had on Germany while Germans believe that the matter, of reparations during the world wars, should not be up for discussion. However, as Robert Peston points out in Euro's Existential Threat, "for Germany et al the long-term success of the Euro depends on the perception that its rule, and the application of its rules, apply to all, in all circumstances". This article concludes that the future of Europe is very much tied to how this conflict plays out. This is the similar to the points made by Peston when he talks about how there is concern that if the euro fails, it may also signify the failure of its "underlying purpose, which was to bind its members ever closer together".
I think this media analysis of this great "Greek vs. Germany" showdown is overblown. Germany is too smart to let Greece undermine the EU, regardless of whether or not the Syriza Party wants to end austerity or even create a referendum for leaving the EU. All the countries in the EU joined for the long term advantages of a union and I can't see any countries following Greece out the door, should they choose that option. Greek reactions to austerity have been largely emotional and I think they'd regret leaving the EU just to regain control over their monetary policy.
ReplyDeleteI do agree with you in terms of the tension being overblown in this article. I however also believe that when looking at the other countries in the EU whose economies are not in great shape like Italy and Portugal, a precedent set by Greece could have disastrous effects. Countries seemed to join the EU not only because of the benefits it would give them, but also because their allies joined. It may be the same with countries leaving, once one is able to due to not getting their way, others may leave as well.
DeleteOne of the big problems here is the idea of a monetary union without a political union meaning countries like Greece (and spain, portugal, ireland, and italy) do not have any monetary tools to foster economic growth. This might just be what is at stake. Not the EU per se but whether there can be a monetary union without turning into a single polity. The single polity would mean even harder borders around the EU, making it less globalizing. A weaker monetary union would also make it less globalizing due to less integration. So one could argue that the globalizing thrust of the EU and the Euro are at stake here.
ReplyDeleteI think you have brought up a great point Prof Shirk. I think it is, and will continue to be, a difficult thing for the EU to strike the balance between remaining sovereign as individual nations and being so interdependent economically.
DeleteI cannot realistically see Greece leaving the EU any time soon. While I can understand that it must be extremely frustrating to them to not have complete control over their monetary policy, the benefits that are provided from being a part of this union far outweigh the cons. This was a foreseeable dilemma as the EU is compromised of multiple different independent countries, with opposing views all bound together by one currency.
ReplyDeleteWhile there are problems in the EU it is an ongoing "experiment" I do not think we adequately predict what will happen because its something never tried before. Regardless on whether Greece leaves, in the long term the current members of the Union should be fine. If it does leave it could even strengthen the Union weeding out the weaker states.
ReplyDeleteThe EU poses a dilemma for states involved as they sacrifice monetary/fiscal sovereignty for the involvement in a supranational trade and political network, and I think Greece is a prime example of the price of this sacrifice of fiscal sovereignty. Should Greece elect to leave the EU, I think that this would set a precedent which disrupts the legitimacy of the Union. In the face of economic hardship of other states, what would leave them from backing out?
ReplyDeleteI do not think that Greece will leave the EU mainly because it will be hard for them to succeed if they do which will prevent them from leaving. I do believe that if they decided to the EU will benefit because as a whole they will lose one of the weaker states that does not greatly benefit the union as a whole.
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