The Blog

The Greek Situation Calls for More European Solidarity, Not Less

For 48 hours over the course of last weekend, as the Eurozone countries debated how to resolve the Greek problem, the European principles of solidarity and collaboration were effectively abandoned.

It's been a torrid week for Alexis Tsipras. I'm not the biggest fan of the Greek Prime Minister - he has brought an awful lot of misfortune on himself and the Greek people through reckless brinkmanship - but when the analogies that journalists are reaching for to describe his plight are crucifixion and waterboarding, then it is impossible not to feel the pangs of sympathy.

For 48 hours over the course of last weekend, as the Eurozone countries debated how to resolve the Greek problem, the European principles of solidarity and collaboration were effectively abandoned. Eighteen countries, led by the increasingly hawkish German Finance Minister Wolfgang Schäuble, turned on their Greek neighbours and sought to humiliate them. That is no way to approach international negotiations, and certainly not among a group of nations who are formally all part of the same union.

Such counter-productive tactics were sadly not limited to those countries within the Eurozone who are most directly affected. In a staggering display of diplomatic ineptitude, British civil servants and Tory special advisers chose the height of the crisis as the perfect moment to brief journalists that a disorderly Greek exit - which would cause untold pain and suffering for ordinary Greek people - would "make it easier for Cameron" ahead of the UK referendum. The narrow-minded gall of such tactics takes the breath away. If this is the shape of the UK's renegotiation strategy to come, then I truly fear for the outcome of the talks.

Some people would have you believe that these potential cracks in the edifice of the EU are reason to abandon the European project altogether. It's an interpretation that brings Owen Jones and Nigel Farage together in common cause. It's also an interpretation that is completely and utterly wrong.

When a deal was reached, in the early hours of Monday morning, it was not as the result of uncompromising German aggression. It was because European Council President Donald Tusk and French leader François Hollande reminded their neighbours of their duties and their responsibilities towards one another, and called for wiser heads to prevail. In other words, hope arrived at the moment that genuinely pan-European values were reasserted.

Let's be clear: the new deal is not good. There are some positive elements to it, most notably the introduction of a minimum income for Greek people from the start of next year. But on the whole, it is considerably worse than the deal that existed before the Greek referendum. The creditors are demanding that Greece "liberalise its labour markets" (code for reducing workers' rights) and hand over a series of national assets to an independent fund which will then sell them off.

These measures are supposed to make Greece's debt more sustainable. They won't. Making it easier to hire and fire people will not boost national revenues; but boosting the state's ability to collect the millions of euros in taxes that it is owed might. And telling the whole world that you are about to sell off a series of assets to the highest bidder seems to be a surefire way to get the lowest possible price, and sounds remarkably like a fire sale. There must be a better way of generating value from those assets and providing a sustainable income stream that can be used both to boost GDP and, over time, pay down debt. This is ultimately the tragedy of the German position, and that of the Nordic, Central and Eastern European nations which backed it. A more growth-focused deal would have enabled Greece to pay off its debts, to Germany and others, far more quickly than the demand-sapping deal that is now in place.

These are vital points in a conversation that is now long overdue. Five years of austerity policies in Greece have failed to produce the desired results, so we need to start thinking about a new approach. That new approach should not involve Greece being cut off from the EU and being left to fend for itself. Nor should it involve Germany imposing its will on the rest of the Union without any attempt at compromise whatsoever. And it certainly shouldn't involve an opportunistic British government scoring cheap political points from the sidelines.

This is a time for statesmanship. It is a time for all of the countries in the EU to remember what brought them together in the first place. It is a time for more European solidarity, not less.

Popular in the Community