Monday, February 15, 2010

The End of 'Europe'

Last summer, my wife and I took a wonderful trip to Greece. The weather was delightful, I saw some amazing archeological sites, we ate some terrific meals...the usual events of a happy vacation. But in the midst of our good time, we had to twice dodge riots occurring mere feet from our hotel in Athens. We didn't think much of it at the time, beyond registering mild amazement that the rioters seemed to feel it was the government's job to provide them with jobs.

But reading now of Greece's increasingly acute financial problems makes me think that the riots, and the attitude that drives them, are central to an understanding of Greece. As the blogger Spengler and his correspondent point out, the country is infused with corruption and graft of epic proportions. Everyone is trying to get on the public payroll, and many of them don't expect to do much work for the privilege. The country finances an unsustainable amount of spending to keep all these connected operators happy.

And how were they able to keep borrowing to this point? Because they're part of the Eurozone, and lenders have assumed that the Frances and Germanies will keep the peripheral nations from going under. And maybe they still will, but their voters seem unenthusiastic about sending their money to help out countries that have already received a huge economic boost by being included in the European economy.

Not long ago, Greece was a poor country. Its inclusion in the European experiment has given its people a taste of a good life they never really earned. Greece has no great industries, and its public sector is far too large, its social benefits far too generous for what it produces. As great as its cultural and natural gifts are, tourism isn't enough to keep it afloat.

When the productive nations of Europe realize that this scenario isn't limited to Greece, and that a pan-European economic system is a drag on their futures, they're going to demand out, or else kick out the parasitic nations at the periphery of the continent. And that, over a longer time horizon, is likely to render large patches of Europe less charming, prosperous and peaceful than they are today. We will miss visiting those places almost as much as their citizens miss the brief burst of prosperity bought on credit.

No comments:

Post a Comment