INTERNATIONAL
FALL 2015
Biting the Hand that Feeds
Greece’s troubled place in Europe
by CHRISTIAN TALLEY ‘16
s Greece’s economic implosion and a potential “Grexit”
from the Euro dominate the
news cy-cle, questions abound about
how such a mess developed in the
first place. Despite popular analysis,
Greece’s problems reach much deeper than recent IMF austerity plans,
or the 2008 Financial Crisis, or even
their adoption of the Euro in 1999.
In fact, Greece’s woes hint at basic
flaws in the Euro and European Union.
While many see the European
Union’s primary purpose as to regulate European economic and financial
affairs, this was not the original intent
of European supranationalism. In fact,
the EU’s current entanglement in European economics, and especially its
beleaguered Euro, represent substantial
overextensions from its initial aims.
A
The basic precursor institutions that
would evolve into the European Union
resulted directly from the destruction
of World War II. “Good Europeans”
like the cosmopolitan statesmen Jean
Monnet and Robert Schuman hoped
to construct a supranational “Europe”
that would make future continental
warfare “not only unthinkable but materially impossible.” Thus, in 1951
they founded the European Coal and
Steel Community to manage basic resources, with the particular aim of
mitigating Franco-German antagonism
over coal in the Ruhr Valley. As preventing World War III was the Good
Europeans’ goal, a Franco-German
rapprochement was a high priority.
Later, in 1957, Europe’s leaders signed the Treaty of Rome, creating the European Economic Com-
munity. The EEC promised to reduce
European customs and to ensure the
free movement of goods and services
across Europe. While these measures
involved production and exchange,
the goal was always political: to make
future European war impossible by
interlinking
European
economies.
Schuman hoped that these arrangements would amount to “a great experiment, the fulfillment of the same
recurrent dream that for ten centuries has revisited the peoples of Europe: creating between them an organization putting an end to war
and guaranteeing an eternal peace.”
While the Good Europeans’ push
toward liberalized markets was an unimpeachable goal, European supranationalism began a more questionable
evolution with the 1992 Maastricht
Treaty, which established the European
Union. Rather than a set of sovereign
nations enjoying reduced barriers to
exchange, the EU was to be a qualitatively different institution: it was
to set common policies in foreign affairs, internal security, social policy,
and economics. Moreover, the Maastricht Treaty contained a mandate for
an EMU, or European Monetary Union.
The EMU, named the Euro, for the
next decade became the preoccupation
of the EU. While the EU’s leaders had
hoped that the Euro would strengthen
the European economy in a variety of
ways (acting as an alternate reserve
currency, reducing transaction costs,
etc.) it remains a dubious achievement for the reasons discussed below.
One major decision involved which
nations would be allowed to use the
currency upon its 1999 creation. In-
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