It’s often the unwatched pot that boils first. All eyes this week have been on Greece, which is offering to sell some of its islands in a belated attempt to appease its creditors. The prime minister, Antonis Samaras, has been pleading for more time. “We need room to breathe,” he told EU leaders – though it is, of course, the corset of monetary union that is causing the asphyxiation. Angela Merkel and François Hollande have so far been unmoved, insisting that they have eased Greece’s terms for the last time.
After three years, the rest of Europe has lost patience with Athens. Indeed, there is an uneasy sense in the palaces and chancelleries of the Continent that Greece may be the least of their worries. In the past 72 hours, Cyprus has revealed that its deficit is 4.5 per cent, rather than the 3.5 per cent previously declared, making a bail-out there hard to avoid. Ireland has announced that more than a quarter of its owner-occupier mortgages are now in arrears. Portugal, which had rather dropped out of sight since its own bail-out, has seen a sharp fall in tax revenue, and now admits that it won’t meet the EU-mandated deficit target.
(...)
As the sums mount, the backlash grows. The last Finnish election saw every other party lose ground to Timo Soini’s True Finns (which, despite its name, is a centrist party that just happens to be anti-bail-out). How long before the other net contributors follow suit?
Brussels leaders have no reservoir of Euro-sympathy on which to draw. Only in Germany – and less and less so even there – can politicians demand sacrifices in the name of the EU. This is squarely the fault of the politicians themselves, who sold the euro on a false premise. Voters were given three assurances about the single currency: that it would boost growth; that it would make its constituent states get on better; and that it would impose fiscal discipline. All three claims turn out to have been lies. Small wonder that the parties that made them have lost credibility. Full story...
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After three years, the rest of Europe has lost patience with Athens. Indeed, there is an uneasy sense in the palaces and chancelleries of the Continent that Greece may be the least of their worries. In the past 72 hours, Cyprus has revealed that its deficit is 4.5 per cent, rather than the 3.5 per cent previously declared, making a bail-out there hard to avoid. Ireland has announced that more than a quarter of its owner-occupier mortgages are now in arrears. Portugal, which had rather dropped out of sight since its own bail-out, has seen a sharp fall in tax revenue, and now admits that it won’t meet the EU-mandated deficit target.
(...)
As the sums mount, the backlash grows. The last Finnish election saw every other party lose ground to Timo Soini’s True Finns (which, despite its name, is a centrist party that just happens to be anti-bail-out). How long before the other net contributors follow suit?
Brussels leaders have no reservoir of Euro-sympathy on which to draw. Only in Germany – and less and less so even there – can politicians demand sacrifices in the name of the EU. This is squarely the fault of the politicians themselves, who sold the euro on a false premise. Voters were given three assurances about the single currency: that it would boost growth; that it would make its constituent states get on better; and that it would impose fiscal discipline. All three claims turn out to have been lies. Small wonder that the parties that made them have lost credibility. Full story...
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