After negotiating all night, the Greek government and the rest of the eurozone have reached a deal to provide the basis for further financial relief. The headlines are all portraying it as Greece capitulating to austerity, despite the referendum a week earlier in which Greek voters thought they rejected that course.
Although it avoids the consequences of Greek bankruptcy or exit from the euro that had been talked about, it’s still not a good look for the European Union. Regardless of how successful one thinks they have been – something that will take a while to become clear – the apparent determination of some EU leaders to humiliate the Greeks has cast a pall over the future of the European project.
On my view, Greek prime minister Alexis Tsipras is the only one to come out of the saga so far with much credit. He seems to have done everything he could to secure a better deal but finally, when faced with compelling evidence of the German willingness to drive off the cliff rather than give significant ground, he gave in – lacking, as he kept saying, any mandate to take his country out of the eurozone.
You can read Tsipras’s statement here – it’s rather good. The chief European commentator for the Wall Street Journal, not otherwise likely to be sympathetic to the radical left, called it “statesmanlike”.
The key message, it seems to me, is that the EU is a political institution and its actions are driven primarily by political imperatives rather than economic ones. Although there’s been an element of bureaucratic disdain for Greek democracy, and perhaps democracy in general, most of the summit seemed to proceed along the familiar lines of partisan politics, with leaders from the centre-right (led by Germany’s Angela Merkel) being most hostile to Greece and those from the centre-left (particularly French president François Hollande and Italian prime minister Matteo Renzi) trying to keep things civil.
More generally, despite the lingering economic gloom, Europe’s problems are fundamentally political. I went to a very interesting panel discussion last week at the international conference of Europeanists on “envisioning European futures”, where four distinguished experts spoke on the intersection between the economic and political crises in Europe. Not surprisingly, most of them mentioned Greece.
Kim Lane Scheppele, from Princeton University, argued that a number of half-built EU institutions have reached crisis point at about the same time, meaning that the Union is unable to address one issue at a time (which it could probably do successfully) but is forced to fight on a number of fronts, where the effects of one crisis compromise the ability to deal with others.
So, for example, the need to placate one of its largest members, the United Kingdom, limits the EU’s options for increased integration, since anything that looks like the dreaded “federal Europe” could provoke a British exit. Scheppele’s case study was the inability to discipline Hungary’s government for its illiberal designs, but much the same could be said of the inability to pursue the sort of fiscal integration that might avert another Greek-style crisis.
Another academic, Peter Hall from Harvard, argued against measures like fiscal integration, saying that while the EU should be committed to democratic values it should give up the pretense of operating as a political union. In particular, he warned against the sort of detailed economic prescriptions for a member state that have now been agreed on. But he acknowledged the contradictions inherent in limiting the scope of EU project, while expressing the hope that they could ultimately be resolved.
The most distinguished of the commentators, Jacques Rupnik from Sciences Po in Paris, reflected on the disappointment of the high hopes that had come with EU enlargement a decade ago. He argued that the EU’s capacity to deal with the international crises to its east and south – the conflict in Ukraine (and as he put it, “the Ukrainian question is the Russian question”) and the refugee flow from the Arab world – depends crucially on its ability to solve its internal problems.
The southern and eastern Mediterranean deserves its own post, which I’ll try to get to tomorrow. But it’s at least obvious that with Greece on the front line of a troubled neighborhood, this is not a good time for its EU partners to be throwing it under the bus.