Just one cranky right wing coalition…
by digby
Henry Farrell takes a look at Europe’s fundamental problem: the EU itself.
The Greek state is not the only one that is underdeveloped – the EU/Eurozone one is too, meaning that there isn’t any single actor that can strike deals, whether informal or formal, on the part of the collectivity. It’s not at all clear that anyone can quietly make a credible commitment to Greece to knuckle under in the expectation of better things in the long run, because it’s not clear that anyone on the other side of that bargain can push through a long term restructuring of debt given how toxic the politics have become. Even if the Greeks started behaving exactly as the rich eurozone countries want them to, it’s not clear that the latter countries’ publics will be willing to forgive what appears to them as vast amounts of taxpayers’ money – and under the current system as I understand it (happy to be corrected if I’m wrong, since much of the devil is in the detail), all that it takes is one member state with a cranky right wing coalition partner to refuse a deal.
To be clear – none of this conducts towards any specific recommendations for what Greece or the eurozone countries ought to do. It’s a lot more modest than that. If we treat Greek debt as a political instrument of control rather than a quantity that is going to be demanded from the Greek people over the shorter run, we should be arguing about the project for which that instrument is being deployed, and asking whether (a) it is fit for purpose, and (b) whether the kind of project that it’s being used for is one that’s going to work over the longer term. We should also be wondering (c ) about the endogenous ways in which the instrument of debt as a form of political control affects the actors on both sides of the relationship, and whether it makes some successful and mutually acceptable long term modus vivendi more or less likely. Obviously, I’m skeptical on all of these (and given past track record, I’d have expected Daniel to be more skeptical on (a) and (b) than he appears to be), but willing to hear counter-arguments.
I think this is right. This system that has largely unaccountable outside actors using debt as a means of political and social control (and yes, this is social control) isn’t democratic by any means and should be questioned on that basis. But perhaps we should be questioning whether it’s even working for the system itself. We watched the so-called Masters of the Universe almost kill their own golden goose just a few years ago and they only live today by the grace of people who bailed them out. They may not be able to see their own folly.
But this strikes me as well:
[U]nder the current system as I understand it (happy to be corrected if I’m wrong, since much of the devil is in the detail), all that it takes is one member state with a cranky right wing coalition partner to refuse a deal.
I know that the idea was to have a sort of loose “United States of Europe” that would eventually work through that sort of problem. But when you think about it, we’ve been doing it for over 250 years and we still don’t have that little problem cracked. It all depends on how willing (eager?) an extreme political faction is to push the envelope.
Interestingly, here in the US, it was the combination of the “extreme” factions of both the right and the left that stopped the US Government from cutting pensions in 2011. This was not because the cranky right wing doesn’t believe in austerity. They just obstruct anything that a Democratic Party wants to do. But in the end, this system depends upon some adherence to norms of democracy and common interest. When that breaks down, all hell can break loose.
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