Greece: The Ungrateful Biped

Greek default and exit from the Eurozone might be “unthinkable” for the bureaucratic engineers of the monetary union. For the Greek nation, it would be a laudable assertion of independent existence.

Dostoevksy defined man as the Ungrateful Biped. Ungrateful because, even if he were given an orderly heaven on Earth, rationally designed, perfect in all respects to serve his needs, he’d remain likely to disrupt the mechanisms, and to tear the order apart, just to feel alive and to assert his ability to do as he likes.

“Man is stupid,” the narrator says in Dostoevsky’s Notes from Underground, “phenomenally stupid; or rather he is not at all stupid, but he is so ungrateful that you could not find another like him in all creation. I, for instance, would not be in the least surprised if all of a sudden… in the midst of general prosperity, a gentleman with an ignoble, or rather with a reactionary and ironical, countenance were to arise and, putting his arms akimbo, say to us all: ‘I say, gentlemen, hadn’t we better kick over the whole show and scatter rationalism to the winds… to enable us to live once more at our own sweet foolish will!’. That again would not matter, but what is annoying is that he would be sure to find followers — such is the nature of man.”

I imagine that something like these words must be ringing through the heads of officials from the European Union, the International Monetary Fund and the European Central Bank, as they ponder the possibility of Greek exit from the Euro. Greece’s creditors just can’t understand why the Greeks won’t play by the rules, accept the obvious weakness of their position, and acquiesce to the creditor’s demands, derived as they are from the prevailing view of what makes economic good sense. Get your government and institutions in order, they demand, become more competitive by cutting pensions and slimming down government. It’s what we’re all doing. The Greeks respond by — gasp! — asking the people of Greece to actually decide what they want to do in a democrattic referendum.

I’ve been hoping for some time now that Greece will leave the Euro, for a couple of reasons. First, it seems like the only way Greece will be able, eventually, to return to a stable economic situation as an independent nation. Greece would have a period of significant financial hardship, but, with its own independent currency, would ultimately recover. Second, I think that Greek exit from the Euro — along with, perhaps, the exit of a few other nations, including Spain and Portugal — would be a healthy reality check for the architects of European integration. The Euro as a currency does not fit all the nations of Europe, and insisting that it can just continues creating imbalances and problems. The mere fact that European authorities seem to think that steps away from further integration are “unthinkable” is a sign of deep trouble.

Some of the history of the European project, and the thinking of key players, is actually quite frightening. I’m just going to quote from something I wrote a few months ago, derived from the research on the history of the European Union:

The French political scientist and diplomat Jean Monnet, widely viewed as a founding father of the EU, envisioned that integration would be directed by an elite of pro-European bureaucrats. The project was designed to be immune to voter concerns and virtually irreversible. Problems would serve only to propel it forward, by revealing the need for the further expansion of European political power. Ultimately, voters would see the wisdom.
“Europe will be forged in crises,” Monnet wrote in 1976, “and will be the sum of the solutions adopted for those crises.”
Supporters of European integration talked about creating an unstoppable “chain reaction.” Turning back, even temporarily, would never be an option. The great strength of the euro, as German Chancellor Helmut Schmidt saw it, was that “nobody can leave it without damaging his own country and his own economy in a severe way.”

Just soak in the hubris.

The fiasco over Greece has been going on now for five years. And it increasingly looks as if the aim of the creditors was never to help the Greek nation restore itself to financial stability, while retaining its independence. The funds dispersed haven’t gone to help Greece but to shore up the balance sheets of the French and German banks that were originally most vulnerable to a Greek default. The Greek people have suffered greatly, while their government has moved a long way toward satifying the arbitrary demands of the creditors. If you Greeks want financial stability, and to stay in the Euro, the creditors have effectively said, then you must lose your independence. More hubris.

So I’m hoping that next week, the Greeks give a resounding answer of “no” in their referendum. They would, I expect, be seen then by European leaders as a nation of Ungrateful Bipeds. But they would have shown good human sense by any other measure.