Again, it was known at conception that the Euro would fail.
Joining the euro club was once a badge of political and economic advancement. Now, if Athens is pushed out, others may choose to follow
Finally, the endgame. After weeks of posturing, Greece is running out of time to escape bankruptcy and a forced exit from the European single currency. By Friday, as both sides scrambled to fix up a fresh round of talks for this weekend after the International Monetary Fund’s negotiators flew home in frustration, it appeared that European officials had been discussing how they might manage a Greek default.
It’s hard not to be mesmerised by the day-to-day drama of walkouts, public posturing and political intrigue, which may finally reach its conclusion in the coming days.
But as Greece hurtles towards the brink, it’s worth asking how we got here. The euro was always meant to be a political project above all – lifting Europe’s stragglers up to the living standards of the rest and, in doing so,k cementing the political ties between Athens and Antwerp, Madrid and Munich. Joining the club was a badge of political sophistication, as well as economic advancement; and clubbing together, it was thought, would help the European economy to act as a counterweight to the might of the dollar and the hegemony of US-style market capitalism.
It’s a measure of how far the eurozone has departed from that founding mythology that the IMF, the fountainhead of economic neoliberalism, has sometimes found itself having to act as a moderating force as the bailout talks have dragged on in recent weeks.
Since 2010, Europe’s powerful “core” countries – led by Germany – have forced Greece and the other bailed-out countries to swallow a hefty dose of neoliberal orthodoxy: deep spending cuts, deregulation of a string of markets, pension reforms, the dismantling of collective bargaining. Private sector bondholders, many of them German banks who lent hand over fist to Greece in the runup to the crisis, were largely made good; workers have suffered wage cuts as the government struggles to make repayments to its bailout creditors.
Germany’s finance minister, Wolfgang Schäuble, has sometimes seemed more interested in impugning the trustworthiness of his Greek interlocutors than trying to find common ground and cement a deal.
Full article: The eurozone was a dream of unity. Now Europe has turned upon itself (The Guardian)