Greek crisis: Brussels’ fatal therapy
15 February 2012
The Euro Group has postponed its decision on whether or not to grant a new aid package to Greece, fearing that the austerity plan adopted by Athens will not be implemented. But rather than the brutal slashing imposed by Brussels, the country needs to be restructured. And rather than being stigmatised, it is in need of solidarity.
The latest news from a divided Europe is that for the first time, German exports have reached €1 billion. The economic situation is bright, tax revenues are rising, unemployment is falling, [labour union] IG Metall, due to high profits in the industrial sector, is asking for a 6.5% salary increase. Germany is an island of bliss.
And now here is Greece, a country in the midst of upheaval, thrown into the abyss. The transition government has decided, under the pressure of the Troika (European Union, European Central Bank, International Monetary Fund), to impose a new set of draconian austerity measures. Salaries are to be slashed by 20-30% and150,000 people will be laid off from the public sector by 2015. The economy, which is expected to shrink by at least 8% this year, is in freefall and the threat of bankruptcy has not been averted.
The risk of political radicalism
The second EU bailout plan, totalling €130 billion, has been nonetheless suspended. The Eurozone Finance Ministers, in fact, doubt that the government of Prime Minister Lukas Papademos is up to the task of applying the announced austerity measures – not without reason. The cuts already enacted do not work because they only make things worse. In addition, the Greeks are putting up a stiff resistance to the programme of pauperisation and decline of their country.
Is this the prospect for a united Europe? Transforming the land in which Western culture and democracy were born into a protectorate of Brussels – with no hope for improvement? Is this a continent ever more deeply divided between the rich North and the South with its misery in which people wonder where their daily bread will come from? Meanwhile, in Germany, the ruling coalition is seriously thinking about cutting taxes.
Yet, one cannot be indifferent to what is happening on the rest of the continent. And not only because it heightens the risk of political radicalism and the return of nationalism, as will be evident in the upcoming Greek elections.
We should also be concerned because this development, fraught with consequences and clearly promoted by Berlin, threatens our own model for success. The German economy prospers only because our firms do business to the detriment of weaker countries.
Threatening atmosphere mainly hostile to Germany
But who, in the future, will still be able to buy German products? Would it not make sense to admit that we do not need to be associated with countries in crisis that cost us money?
However, anyone who thinks along these lines is making a serious mistake. The country that is deriving the most benefit from the programmes to save euro is not Greece, but Germany. If Greece goes bankrupt, Germany’s banks will also lose billions, and German taxpayers will have to cover the cost. If we re-introduced the deutsche mark, it would immediately shoot up in value. Prices of German products would increase by 40%, and the German model of growth fueled by exports would rapidly come to an end.
Southern Europe, and not just Greece, is increasingly pervaded by a threatening atmosphere that is mainly hostile to Germany. Close to 70 years after the end of the war, our country is once again perceived as an enemy. And demands for a radical response to the hostility of Brussels and Berlin are growing more and more vocal.
But can we really criticize these people who have been plunged into poverty? Are they supposed to stand idly by while their modest model of prosperity is ground into the dust and their politicians are completely sidelined? All of this so that the banks and speculators can recover all of the high interest loans that they were so eager to foist on weak countries.
Greece needs our solidarity
No, this is not the Europe in which we want to live: a Europe where the banks and investment funds decide which countries will survive and which will not.
The austerity policy unilaterally imposed by the financial institutions and Angela Merkel comes at high cost: it will result in the disintegration of Europe. And this will be followed by a prolonged depression that sooner or later will be felt in Germany.
Greece needs our solidarity. We should write off its debts and set about implementing a development plan instead of insisting on an endless cycle of bailouts and austerity measures. This is what is needed if, in ten or 20 years time, we want to see a country that can once again stand on its own two feet and act as a full member of the Union.
Such a European development project would not cost more than other options, while opening new horizons for the people of Greece and the people of Europe. This is why we should push for such a plan, instead of campaigning for an end to European solidarity and the expulsion of Greece from the eurozone. We need Greece to show that Europe has not forgotten the reasons for its existence.