Blog 2023 Malcolm Blair-Robinson

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It is difficult to find a rational explanation about the never ending saga of Greece hovering on the threshold of Euro membership. Certainly it is guilty of a reckless period of spendthrift abandon. But that is in the past. When dealing with a whole nation of people you cannot proceed as if with one errant individual. Everyone in Europe, save for those concerned in the financial governance of the eurozone, can see that for whatever reason Greece is bust, and the strictures and demands being made by its creditors in order to provide more money so as to enable Greece to continue to pay them, are politically impossible. It can also be said that lending money to allow worthless assets to acquire notional value, ie Greek debt held by European banks and others, is fundamentally pointless, even dishonest.

Moreover it is clear that the Greek government was elected by a popular mandate which refuses to countenance further austerity in an economy already shrunk by a third and that for outside powers to try and enforce such a programme upon an unwilling people is not only undemocratic, but flies in the face of everything which the EU is supposed to stand for as a democratic union of free people. The driving force of European governance is its richest and most populous power, Germany. Berlin must now pause and consider where it is headed. Not for the first time does it stand in command of a chain of events of which it can easily lose control and in the consequent upheaval it becomes the big loser.

If Euroland proves too inflexible to cut Greece a viable deal to reboot its economy and Greece goes back to the drachma, it will be a blow to the whole of the EU and there will be a period of nervous uncertainty. The likelihood of the UK throwing in the towel and voting to leave will increase. One thing could lead to another. We have been there before and there is something we have learned the hard way. The end is never foreseen at the beginning.