Tuesday, July 7, 2015

A Non-Expert Weighs in on Greece

Picture provided by former student
I don't study International Political Economy, I am not an expert on Greece, and my only publication that has anything to do with the European Union scoffs at conditionality.  So, take what I say with a huge grain of salt--->

With those caveats in mind (I cannot help myself),  I have a few thoughts on all of the discussion about Greece.

First, as folks discussed this morning on twitter, Greece has long been Least Loved Member of the EU and of NATO.  Why?  Because Greece not only free rides but then complains and stirs the pot.  Yes, Greek politicians were mildly brave in 1999 by not blocking the decision-making at NATO over the Kosovo campaign.  But Greece, despite having one of the largest militaries in Europe, send the smallest contingent to Afghanistan.  Greece has also blocked most efforts to develop better ties between the EU and NATO on security matters because of ... Turkey.  Greece has stirred the pot in Albania with its irredentist designs.  And, of course, Greece's opposition to Macedonia's name has kept Macedonia from becoming a normal member of European institutions.  Oh, and folks on twitter noted that Greece's cozying up to Putin played poorly in the EU as the Baltics, Finland, Poland, and others are not big fans of Putin these days.

Second, people seem to be far more sympathetic about Greece's domestic politics than about the domestic politics of the rest of the relevant actors.  All EU members have domestic audiences, and few have much sympathy for Greece.  The widely shared view is that Greece has done little to reform itself, so why throw more money down a black hole?  Politicians will lose support if they bend much to help Greece.  It does not make these countries right, but it explains the stances.

Third, some basic veto-player stuff: the EU is not a single actor and is not simply Germany.  To get decisions made, there needs to be a fair degree of consensus, if not unanimity.  So, even if some politicians around Europe were brave enough to ignore their domestic audiences, they might easily be blocked by other countries who do not want to change the current stance.  When you have many veto-players, it becomes hard to change a course of action.  So, there are institutional reasons why the EU cannot bend as well.  For the complexity of collective principals, see chapter two of the Dave and Steve NATO book.  The EU is not NATO, but there are similarities.

Fourth, blaming Germany can be fun, but it can be distraction sauce as the historical analogies are most problematic.

Fifth, it is only a game of chicken if both sides are killed in a crash.  The EU and its members are not likely to be harmed that much.  Hurt?  Yes, but not compared to the costs Greece will face.

Finally, when the crisis broke out years ago, my first reaction was surprise.  Despite being a skeptic about conditionality, I never expected that Greece would be let into the Euro zone.  Italy was a reach, but Greece?  

Where will this go?  I have no idea.  I am just glad that this is happening now and not seven years ago.  As far as I can tell, the impact of a Greek default and Grexit are far lower now as everyone has reduced their exposure.   I don't think this will cause the collapse of the Euro or the European Union whether Greece stays or goes.  Why?  Because of path dependence: the existence of both the Euro and the EU have created audiences that benefit from these cooperative efforts, and these audiences have power and influence.  I do feel bad for the Greek citizens who are paying the price for the bad decisions their leaders have made over the years, but, then again, they chose them.  More benefits and less taxes is an easy promise to make, but there is a price to be paid eventually.

1 comment:

Mike Tierney said...

Steve, this made me think of our "don't know" discussion and gender yesterday. I can't look up your answer to TRIP questions because of confidentiality safeguards, but we have asked prediction questions on Greece and Euro three times in past few years (including last month). Doubt you can remember how you answered, but if you can, it might be interesting to reflect. As you say in the blog post, "I have no idea." And I believe you. But even when I have no idea on a survey, I usually guess. Don't know if that is personality or gender or what, but I think women are less likely to guess. They more often select, "Don't Know."

Also, despite your lack of expertise in IPE, I found this post both reasonable and insightful. Collective Principals indeed. Although, in this case, they may contrast with collective European principles.

For an interesting initial analysis of expert opinion, see this short article by two of my students on Diplomatic Courier...