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The Euro-tragedy The Euro-tragedy
by Thanos Kalamidas
2010-02-24 08:04:14
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And the talk about the Greek economy continues but it seems that nobody cares to listen the Greek prime minister or the Greek citizens, something that makes you wander what really is going on with the Euro and the European economy in general.

In an interview for the BBC the Greek Prime Minister, George Papandreou pointed that the bitter truth is that the mismanagement of the economy from the previous government is what brought us here, and we admit that, period. And the mismanagement had to do also with, unluckily, a lot of corruption, cronyism, clientilism in the way that money was used. This is also truth and all the Greeks admit it and accept. Actually their constant agony the last few years is how to change this situation and the prove for the will is the radical change of the government a few months ago and to everybody’s surprise to give to this government the necessary power in the parliament to be able to force the right laws to change the situation.

And it was not the European Union, the international economic institutions, Angela Merkel or Nicola Sarkozy who did that, it was the Greek people who despite all the trash publications the last two months are very aware of what’s going on and they are willing to do something about it with the only weapon they have in a democratic society, the elections. The same time the other thing the previous Greek government managed to do and to my opinion is much worst is that they hurt the credibility and the legitimacy of the country.

But again that nearly 60% of the population voted for this government with the clear order to do something here and now it is something serious and as I said before it show the will of the people. The same time as a result of the hurt credibility the banks are afraid to give money to the Greek government to escape the crisis. Very correctly the Greek Prime Minister points that the Greek economy doesn’t only need the money to pay back the loans but – and it is more urgent – need the money to invest and resurrect an economy in crisis. But this is impossible when the Greek government has to borrow money with the same interest like countries with inflation that reaches 20 and 30%, with economies in zero growth and in recession for decades.

So this is where the conspiracy theories start. The Greek economy is not the only European economy that suffers and actually the European economies have worked the last few years like problematic private companies presenting profits and damages with accounting tricks. The mighty German economy is not in any better shape and it hasn’t recovered from the unification doesn’t matter what the cooked accountings show. What saves till now the German economy is the existence of the heavy industry and the sponsoring to Angela Merkel’s government for reasons that is not the place or the time to talk about. The same applies to the French and the British economy. Would any British economist even dream two decades ago that the exchange rate of the pound in Europe will be around 88 cents? For me who am not an economist this is a message that something going wrong with both, the pound and the euro.

The Greek Prime Minister in this interview like in many others - also the Greek economic minister - have often point out that the Greeks don’t expect the Europeans to bail Greece out; they have the decency to accept that they have to deal with the mistakes of the former governments themselves and this is the correct way to deal with a crisis. What they try to say - and it seems nobody wants to hear - is that what is missing is the political support. They are not expecting the European Union, Germany and Britain to open their safe and give billions of Euros, after all these Euros will come from the taxpayers of those countries and that will be plainly unfair especially under the economic circumstances.

But where has been this political support to the European economy and especially to Euro since its birth? When the European leadership came with the plan with anything to do with the euro except of last minute damage controls? When the Europeans lost control and the Euro nearly gone to be equal to two dollars the only thing that happened was panic in the offices of the German banks and the central European banking institutions. Instead of trying to see what brought the euro there and how they could make the best of it their main concern was to strengthen the American currency! So why did they create the Euro and they didn’t adopt the dollar?

The Greek government despite all the despicable headlines and covers that saw lately the European nd mainly the German media - the German magazine Focus was the most despicable of all with the Financial Ttimes following close enough - ais not expecting the Germans or the other Europeans to bail them out but is expecting the EU leadership to do what they failed from the beginning to do, support politically the Euro and make everybody understand that the Euro is a strong currency with over half a billion people behind it and a strong administration that can support it in the good and the bad days. But the European leadership has failed in both, the good and the bad days.

What happens lately with the Greek, the Irish, the Portuguese or the Spanish economy is not a chorus of a Greek tragedy but a scene of the wider European tragedy and Europe is in a very strange crossroad that tests its unity. A few years ago the European leadership was unable to politically support a united foreign policy and not forget the total failure under the American pressure with NATO working as the Trojan horse of the European defence policy, amazingly NATO anounced lately that there are problems lately in the alliance because the allies don't buy enough American weapons. That’s what is missing from the European Union and not the German taxpayer’s money!


        
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Emanuel Paparella2010-02-24 12:52:21
A new Europe in Search of its Soul? Indeed, those who would build a union by privileging merely economic-political considerations above cultural considerations eventually discover that they are building on sand. In 1860 after Italian unification was achieved its architects came out with this gem of a slogan: now that we have made Italy we need to make the Italians. Perfect example of the cart placed before the horse. Pari passu, now that we have made the EU we need to make the Europeans. Santayana had it on target: those who ignore their history are condemned to repeat it.


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