It’s Europe, stupid!

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

Europa, Riding Zeus as a Bull

Europa riding Zeus. [Mim Tasters]

The real question facing us is not whether to say yes or no to Syriza, but how the EU continues its construction, write Ernest Maragall MEP and Jordi Angusto.

Ernest Maragall is MEP for the Greens/EFA and Jordi Angusto is an economist.

The real question facing Europe right now isn’t simply whether Greece will remain in the Euro, but the more fundamental question of what kind of Europe is now possible?
Is Europe no more than a level playing field for trade and fiscal competition between nations? Or is it a real union of nations striving for something greater than merely its own expansion?

If the former is true, then Greece is certainly today’s loser, but other candidates will soon follow – Spain, Portugal, Ireland and so on until there’s only one winner left. The European Union would then be much as it was at its foundation, but with the euro as its most powerful economic weapon.

Between 1948 and 1999, the Deutsche mark exchange rate with the Greek drachma increased by a factor of fourteen. During that period the Drachma was devalued from time to time in order to adjust internal imbalances. With Greece inside the eurozone, similar but non-adjustable imbalances created a colossal debt. Who is to blame for this but those who believed that a common currency could be held together with only a common monetary policy? Who really believed this, apart from those naive and misguided monetarists?

That was the EU’s first big mistake. The second was the idea that austerity and internal devaluation could reverse the situation. The results of that approach are there for all too see: skyrocketing debt, unemployment and poverty in the debtor countries, combined with deflation across the EU as a whole. How can the Troika credibly insist upon such unfair and ineffective remedies? The real question facing us is not whether to say yes or no to Syriza, nor indeed whether the Greeks should say yes or no to the EU.

The real question is how the EU continues its construction from here.

Did anyone in the USA threaten Detroit with exit from the Dollar or the Union when it was in financial dire straits? Of course not! Instead, the federal government intervened to invest in GM, Detroit’s largest company, whilst offering support to the unemployed.

Whilst the USA has a long history, with some wars along the way, Europe’s history is longer and our wars have been world wars. We would do well to remember the Compromise of 1790 when Virginia displayed such generosity towards the other heavily indebted founding states and assumed far more than its fair share of the debt, for the benefit of all.

Today, the EU faces challenges of just such historic magnitude. It must decide about its own existence, and indeed, its purpose. In this regard, some wise generosity could lead to a unique European victory.

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