Just a short note on Greece because at the moment I’m concentrating on writing revision guides.
For several years I have felt that Greece would be better off to leave the Eurozone. This is partly due to economics, but also partly an intuition – that there is no greater recipe for political disaster than having disastrous economic policies dictated by a foreign power (EU, IMF, Germany)
The frustration in Greece at Europe is well-merited.
- Leaving the Eurozone will perhaps make Greece masters of their own destiny. They will not feel they are under the thumb of Europe (aka Germany)
- Leaving the Eurozone gives the possibility of a better long-term framework – which doesn’t involve common monetary policy, exchange rate and fiscal austerity.
- Staying in the Eurozone offers only an endless diet of self-defeating austerity is a recipe for deep frustration – it is hard to see any hope.
I’m conscious of the fact I that the consequences of default and Euro exit will be equally damaging – if not more so in the short/medium term. I’m also conscious of the fact – I’m not quite sure what will happen. There are not many precedents of developed economies going through such difficult times. There is the very strong likelihood of it being very grim for a considerable time. But, it should be remembered you can always come out of the worst crisis. Germany’s own hyper inflation was devastating for a couple of years. But, it did recovery.
Failure for Europe
The Greek crisis is not just a failing for the Euro project, but the whole European idea. European politicians will want to blame the irresponsible Greeks who had the temerity to ask the population what they thought, but it reminds you of the story about the plank in your own eye.
The incomprehensible desire for never-ending austerity has been wholly self-defeating for both Greece and the Greek creditors.
Time to rescue Greece
Whatever happens, there needs to be a swallowing of pride and a real European willingness to support Greece in this crisis period. A failed Greek economy should be seen as a failure for the whole of Europe.