A Byzantine crossroads

I was quite surprised this morning when I was able to walk through Syntagma Square on the quickest route to the site without meeting any real police presence. I had thought that I'd read that there was to be another important vote in the Greek Parliament, this time a vote of confidence after PM George Papandreou had installed a new cabinet (including a new finance minister, Evangelos Venizelos). As it turned out, the vote happened last night, and though the wreckage was much less than it was a week ago, I did wonder whether I had a cold before recognizing the tart odour of tear gas left hanging in the air from the night before. The real crunch vote, it turned out, will be next week, when Parliament votes again on the austerity measures necessary for Greece to receive its latest bailout.

As I walked between the rows of protestors camped out on the square, I found it hard to sympathize with them, despite their obvious idealism. (One sign said 'Real Democracy', which caught my eye - but alas, references to the Cleisthenic constitution were in short supply.) In one sense, the debt crisis is deceptively simple. The Greek government has now to impose austerity measures on the Greek people because the nation spent more money than it had. Most of the welfare programs the protestors are trying to protect are admirable, and the cutbacks will surely hurt Greeks hard, but in the final analysis it's hard not to agree that Greece must pay its own way in the world. In other words, dream your socialist dreams all you want - just don't try to realize the ones you can't afford. This is obviously something close to the thoughts of many Germans, who have scrupulously not borrowed more than they could afford to borrow over the past few years.

On the other hand, there is the question I raised with my American flatmates last night: don't the wealthy states of the US effectively subsidize the poorer states? They must, since the US has a single currency, so that Alabama can't make its products more competitive by depreciating its currency. Instead, it has to take the hit for the rest of the union by becoming poorer, in the way the Conservative MEP Daniel Hannan argues that Greece is now being forced to do for the sake of the Euro. In return, Alabama must receive not only the benefits of common goods created by the union (such as security), but also transfers of various sorts (at least, I know that this happens within the Canadian confederation). Plainly, then, this sort of situation could also become the norm in the EU, if (and it is a huge 'if') the northern European nations could be brought to think of their southern neighbours as compatriots, fellow Europeans worthy of the solicitude and generosity of their peers.

This Greek crisis, I thought as I walked by the Byzantine Church in a junction on Ermou Street, is a crossroads for Europe. If the EU does bail Greece out again (and maybe another time before this is all over), it will set a precedent that would set Europe on a path towards ever-closer union. If it doesn't, it effectively marks the end of the European project, and a decisive demonstration that monetary and political union, if they are to go anywhere at all, must walk hand in hand.