European Greece or Greek Europe?

The results of the Greek general election of 17th June 2012 apparently open up a political path to Greece remaining in the euro zone, with the implementation of the Memorandum (a programme to reform and reduce deficits, as signed by Greece in exchange for European aid). In any case the maintenance of the euro by Greece depends less on the EU, which has demonstrated its solidarity with a series of aid programmes since 2010 totalling 340 billion €, than on its ability to return to reality and to rise to the challenge of competitiveness. Even though the return to the drachma is now a waning prospect the Greeks probably ended by believing that this would have led to a financial and banking disaster and also to economic ruin. Moreover it would be vain to believe that the activation devaluation would not go hand in hand with austerity measures, that would be just as draconian as those 'set' by Europe, with the solidarity of its neighbours being reduced to a much lower level, if not disappearing completely. The Greek situation reveals that we have to shed all illusions about the creation of fictitious wealth via the distribution of generalised annuities at the service of political clientelism. It is necessary to build real growth on a competitive base. This diagnosis is valid for the 17 euro zone members. The dangers come less from Greece than from the ability of the 'big' States to implement the necessary reforms to re-establish a competitive economy. The cold wave that has hit Franco-German relations just as Greece seems to be about to banish the spectre that threatened the euro zone is a much more serious threat long term. Europe finds itself deprived of one of the most effective means to solve its crises and to build the vital stages on the path to political integration, the basic condition to settle the crisis and to increase growth. We might hope that the end of the French electoral season will lead to convergence on the part of the two main States in the euro zone towards greater political and budgetary integration and also to a growth strategy. Otherwise the dangers of political impotence according to the model of the ancient Greek cities could undermine progress towards European political integration.

• Primary Source

ESO: Background Information: European Greece or Greek Europe? http://www.europeansources.info/record/call-for-eu-to-control-greek-budget-greece-rejects-german-plan-for-eurozone-overseer/

---