How does one say “Goodnight, Irene” in Greek? Or “Show Me the Way to Go Home”? Or, if neither of those classic festivity-enders does the trick, “Hit the Road, Jack”? In any case, the message needs to be sent: The party is over, and it is time for Greece to be shown the door, if the Greeks cannot find it themselves, and exit the eurozone.
A Greek default appears to be imminent. The question is whether it is to be an orderly default or a chaotic one. At the moment, the odds are about even between those two possibilities.
Prime Minister George Papandreou has called a parliamentary vote of confidence and a national referendum on the European bailout conditions to be imposed on Greece. Those conditions include bondholders’ taking a 50 percent haircut on Greek liabilities while the Greek government promises to enforce austerity measures to reduce spending and return the country’s debt-to-GDP ratio to a more manageable level (though getting Greek debt down to the level legally required by the Treaty of Maastricht is not in the works, a fact that should put the European project in perspective). Athens has made such promises before. Greek unemployment remains high, its economy a shambles. The recent recession has made things worse than they otherwise would have been.
The European Union being the European Union, it had been assumed that these conditions simply would be imposed by Brussels, without the Greek people’s having a say. The vote threatens to throw a monkey wrench into European designs, and markets tanked on the news. And what would happen if the Greek electorate rejected Brussels’s agenda? It is far from impossible that Brussels and Athens would simply collaborate to impose the terms in the teeth of democratic rejection. The Greeks should keep in mind the experience of those national electorates that rejected membership in the European Union only to have the same referendum voted on again and again until Brussels got its way.
Unhappily, the Europeans aren’t much in funds these days, which has them appealing to China for assistance in their bailout scheme. Which is to say, not only would the deal make Athens entirely subordinate to Brussels, it would make Athens entirely subordinate to a Brussels that is partly subordinate to Beijing. That may be too high a price even for the pension-loving, debt-ridden, bailout-begging Greeks to pay.
And we would not blame them. Membership in the European Union as currently constituted is plainly incompatible with national sovereignty. In fact, the European project has quickly proved to be not only incompatible with national sovereignty but positively hostile toward it, its consolidation of transnational power and its running rough-shod over ancient nation-states exhibiting a degree of vigor and energy shocking even to the most suspicious Euro-skeptics. This incompatibility has come to a head now over fiscal questions, but it might have come to a head as easily over questions of national defense or immigration — questions in which the interests of a France or a Finland are very different from those of a Bulgaria or a Cyprus, but which in any case will be decided in accord with no country’s national interest but in accord with the interests of the bureaucratic elite in Brussels.