It would seem that Greece has become something of a complication within the eurozone. The broke country is so far in debt that it cannot bail itself out without help, but no one wants to help it anymore because there seems to be an ongoing cycle of borrowing followed by being unable to pay its lenders.
Of course, this is not the first time that Greece has been in trouble. The first time that it threatened to default a few years back the IMF jumped in, Germany was forced to contribute, the US participated in the bailout, even the EU jumped in. What one has to wonder, though, is if there will be another wildfire of eurozone countries who suddenly can’t pay their debtors, as had initially happened.
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That wildfire started with Greece. From there, it spread to Spain, Portugal, Ireland, Italy, and France to name a few. This in turn, impacted the confidence of some investors in the euro as a currency. Ironically, back in 2010 Reuters had reported on a US think-tank that was saying that the euro may not even be around in about a decade because it is actually a pretty unstable currency.
So if Greece defaults on its debts, even though it isn’t a large part of the eurozone from a monetary standpoint, recent history supports the notion that enough of its neighbors and foreign investors have invested in its debt to the point that the entire world economy will end up being impacted in one way or another. It’s just a matter of how much damage this wave of the financial tsunami will do, and where everyone is in the process of recovering from the last one.
As for the euro, it has been suggested that its creation was more politically motivated than financially motivated. The UK Telegraph ran a rather interesting article back in November of 2010 which indicated that members of the EU were warned way back in the 1990s that the euro was a bogus currency. Evidently, no one with any true power was really concerned since the apparent purpose of the euro was to bring about a crisis that was intended to allow the, “EU to break down resistance to fiscal federalism, and to accumulate fresh power. The purpose of EMU was political, not economic, so the objections of economists could happily be disregarded. Once the currency was in existence, EU states would have to give up national sovereignty to make it work over time. It would lead ineluctably to the Monnet dream of a fully-fledged EU state. Bring the crisis on” (emphases added).
This particular focus was rooted in the notion that an, “assumption that any crisis could be contained at a tolerable cost once the imbalances of EMU’s one-size-fits-none monetary system had already reached catastrophic levels, and once the credit bubbles of Club Med and Ireland had collapsed. It assumed too that Germany, The Netherlands, and Finland would ultimately – under much protest – agree to foot the bill for a ‘Transferunion’.” Transferunion is the European version of what many conservative- minded Americans refer to as “transfer of wealth.”
The reason that the experiment didn’t work the first time Greece crashed was because there was a lot of unanticipated rioting and protesting among many in the various European countries that are a part of the eurozone, rather than a willingness to come together as one utopia-minded-one world-system sort of culture. That being said, perhaps those with the power are anticipating that the crisis just wasn’t severe enough and people weren’t made to be miserable enough the first time around. It is possible, however, that the actual goal is something much more global.
Elizabeth has been a professional freelance writer for over a decade and has enjoyed having her prose published in both the nonfiction and fiction markets.
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