After the Brexit: What Next for Greece?

After World War II, it was often the fashion to talk of something called “world government” that would necessarily replace the disjointed global system of nation-states and nationally-based empires which had led to two great wars in a generation and posed the risk of a third...

After World War II, it was often the fashion to talk of something called “world government” that would necessarily replace the disjointed global system of nation-states and nationally-based empires which had led to two great wars in a generation and posed the risk of a third,which with the availability of nuclear weapons, might threaten human extinction.

It wasn’t clear how such a government would form. Some looked to the newly-formed United Nations as the model from which its institutions might spring. Others thought it might emerge out of one of the two superpowers that had come to dominate the planet in the wake of World War II. The United States, which had notionally fought the First World War to “make the world safe for democracy” in Woodrow Wilson’s phrase, had set the stage for a proactive postwar role during World War II, and created the military and banking arrangements that anticipated it. Its rival, the Soviet Union, meanwhile continued to espouse a worldwide revolution that would result in the adoption of the collective ownership system called socialism.

The rivalry between the superpowers dominated the postwar age, however farfetched the dreams of either that it could impose its own vision of world order on the world at large. Such fantasies survived the Cold War, at least on the American side, where a rush of triumphalism led to celebrations of a so-called end of history. In this—literally—“end-state” situation, the world would be organized around the self-governing mechanisms of the free market under benign American supervision. The details of local and regional governance could be left to experts overseen by political elites organized defining the range of acceptable opinion and action. Thus, a vestigial form of the nation-state might survive in terms of administrative units, but without the capacity for undue mischief. This latter arrangement would be known as “freedom.”

It is clear that, in a culture addicted to utopias, this was as fantastic a notion as any.

What the seventy-odd years from the end of World War II have actually witnessed is not the end of the nation-state but its explosion as a universal norm; not the imposition of a world order but the spread of social dislocation and political anarchy in a world pressing recklessly on its ecological limitations; not the mechanism of a self-adjusting market system but the riot of greed and self-perpetuating capital accumulation that sometimes called late capitalism. The large-scale structures of political organization inherited from the nineteenth century in the form of industrially-based empires have collapsed; the metastatized state system has proven not a stay against anarchy but a prey to it; the globalized public of the Internet has proved a Babel of rumor, disinformation, fear-mongering, and incitement.

I am stating the case at its worst not because I think the idea of the human race achieving a measure of rational governance based on respect for individual worth and collective planetary responsibility is itself a chimerical goal, but because it is a necessary condition for survival. To achieve it, however, we must first leave aside contemporary mythologies. That’s a task for a much larger essay, indeed for many essays and much sober discussion. But we can begin with the dose of reality just administered by Britain’s decision to leave the European Union, and by considering its potential effect on the member-state most adversely affected by the EU program, Greece.

The European Union was the only political experiment of the postwar era that seemed to have provided a formula for reorganizing the nation-state on a federated level, thus providing a model for wider governance. It was understood as a work in progress, subject to modification and correction. But, in a world beyond the prison-house of superpower rivalry, it seemed a promising formula, and a basis for consensual and responsible growth. In a world of collapsed empires and failed superpower hegemony, it was the only political order that was expanding, not through conquest or forced agglomeration, but by voluntary, democratic consent. That such consent might be repudiated by a critical member-state seemed inconceivable to the EU’s political elites, mounting evidences to the contrary notwithstanding. The Brexit is, consequently, a great and in some quarters an incomprehensible shock. There will be a natural tendency to view it as a spasm of ill-tempered behavior by an insular community whose relationship to the Continent has always been problematic. This reaction is already apparent. Some elements in the Berlin-Brussels axis have seemingly decided to treat the Brexit as an occasion for childish pique. German Foreign Minister Frank-Walter Steinmeier immediately declared that Britain would not be allowed to “take Europe from us,” the us supposedly referring to the EU’s remaining twenty-seven members, but, in actuality, meaning the reality of hegemonic German control. For the EU, misconceived originally as a check on postwar German power, flawed from the outset in its design, and antidemocratic in its effect, has not in fact been a model for transnational cooperation and governance. It has simply been the vehicle of German dominance over the Continent in partnership with the United States, which has supplied it with its military muscle.

If there has been any country in a position to appreciate this fact in the most painful way, it is Greece. The German model of austerity, imposed on the European Union as a whole in the wake of the financial collapse of 2007-08, has been based on a cold calculation of German economic and political interests at the expense of its partners. Its application to Greece has had a further dimension: the singling out of a particular EU member-state for exemplary punishment and humiliation as a lesson in mastery to all. When that punishment led to a show of defiance on the part of the Syriza government in Athens last year, the German response was swift and dire. Within a six-year period, some 400,000 younger Greeks had already been forced to seek their education and livelihood abroad, a silent migration no less devastating than the public and visible one of Middle Eastern and African refugees fleeing the chaos of their regions. The heel of the conqueror would now crush whatever life was left.

Greece, having been rendered functionally bankrupt, was brought within days to the brink of utter collapse.

What the Brexit means is that the failed rebellion of Greece has now been taken up by a nation better prepared to carry it out. In this case, it was not entrusted to representatives, but the direct mandate of a popular majority. The British government opposed it; so did the Labour opposition; so, too, did the talking heads of the media and the grave wise men of the Establishment. The United States, in the person of Barack Obama, threatened a punitive response. It occurred nonetheless. The Brexit is probably the closest thing to a legally binding insurrection you are likely to see in a system with secure elite control mechanisms. Usually, democracy is a safe gamble; people have long since learned to vote against their own interests, or acquiesce in their betrayal by those promising to represent them—see the last eight years of the current administration in Washington. This time, the game didn’t work. The amazement and consternation is general.

Such a response does not mean, however, that what happened in Britain is a one-off affair, a fit of popular pique soon to be regretted. Similar votes were immediately demanded in Sweden, Denmark, the Netherlands, France, Italy and even the new Eastern EU state of Slovakia. Those pushing them are, by and large, right-wing nationalist leaders—Marie Le Pen in France, Geert Wilders in the Netherlands—whose strength the Establishment press persistently and programmatically discounts, but who represent substantial and growing support. In a recent French poll, 61% of the public indicated disapproval of the European Union in its current form. This is a number than does not rely simply on nativist opinion. Would it translate into an actual vote for withdrawal? That is a question the bankers of Berlin and the bureaucrats of Brussels are not anxious to have answered. It is certainly not one they will wish to put to the voters of an even more discontented Southern Europe.

Greece, of course, has already had its referendum on EU policies, if not on EU membership itself. In July 2015, some 62% of Greek voters supported a rejection of the new austerity terms being demanded of them in a national referendum. This was followed by an EU run on Greek banks that, overnight, shut off the country’s credit and left it under threat of being unable to access vital food, fuel, and medicine. German Chancellor Angela Merkel blandly accepted the referendum as a genuine expression of popular sentiment—and then moved to turn the rolling banking crisis she and her colleagues had begun over the previous weeks into a potential humanitarian disaster.

Minus the execution of civilian hostages by firing squads, that’s how the Nazis responded to popular resistance in their time. But there’s no need to shoot rebels these days; one just starves them.

The difference, this time, is that the EU can’t break the Bank of England overnight or cut off the food supply. Britain is a major economy; it is a center of international trade and finance; it is at no risk of bankruptcy. Most importantly, the unhappiness of British voters is widely shared on the Continent. A stampede for the exits by other EU members, or even the withdrawal of another critical one—say, France—could bring the entire structure of a united Europe down very rapidly. And with it would go the principal instrument of German hegemony, the euro.

This would be the best possible result for Greece.

Greece will never regain a measure of control over its own economic destiny until it sheds the euro, and gets itself out from under the thumb of the European Central Bank and the European Commission. With these institutions unable to dictate fiscal policy, its principal interlocutor would be the International Monetary Fund. The IMF bears grave responsibility for the havoc wreaked on Greece since 2010, but it has recently shown a more realistic attitude toward the Greek debt question. The IMF itself would be in a more parlous condition in a post-EU world, where direct currency controls would have been reassumed by some seventeen countries. This would not be a free ticket for Greece out of bankruptcy—laying to one side the question of how much of its odious debt is really owed—but it would create a good deal more room for maneuver. The Greek debt crisis, it must be remembered, was the result of a political decision in Berlin, not of inescapable economic circumstances. A national disaster manufactured by a few strokes of the pen during a worldwide financial meltdown to which German policy itself had contributed materially, can be undone as readily as it was created. Indeed, at virtually any point in the horrific unwinding of the Greek economy, the EU could have swallowed the costs of debt forgiveness with barely a hiccup. The decision not to do so was based solely on the desire to maintain the austerity by which Germany and its northern allies recapitalized their financial institutions at the expense of their enserfed southern neighbors. Such power would be negated by the dissolution of the EU. Individual creditors, sovereign or otherwise, would have to pursue their own claims, almost certainly in the context of sharply devalued national currencies.

One cannot assume that the EU will collapse, of course, or that the euro will disappear as a currency in the immediately foreseeable future. Some commentators, notably George Soros, have concluded already that the EU will not survive in its current form. Senior EU officials are publicly divided over whether to circle the wagons over the Brexit, or attempt to forestall further exit votes by preemptive concessions.   In Greece, a new “loan” installment is due in July after the further round of tax hikes and pension cuts imposed on the hapless government of Alexis Tsipras this spring. The circumstances of any further negotiations with the EU have radically changed, and Greece will have more bows in its quiver. The EU cannot afford an ugly battle with another member state, especially one widely regarded as having been serially abused already. During Greece’s crisis a year ago, the possibility that it might exit the eurozone alone raised concerns of a chain reaction affecting the entire system. The risks of such a result would be exponentially greater now.

This does not mean that Greece should demand a renegotiation of last year’s forced agreement at present. It will be wiser to await events as Britain begins what will likely be a lengthy process of devolution, and as pressure on Brussels builds elsewhere. As painful as the moment is, time will be on Greece’s side. To be sure, anti-EU sentiment is likely to appear in Greece in the form of strikes and demonstrations, and those that have beset France as well in recent months will doubtless take an increasingly anti-EU turn. But now Is the time for bigger actors to play—and, one hopes, for a less compromised leadership to emerge in Athens as well.

There is a further consideration, namely the uncertain status of the agreement with Turkey that has, for the moment, stemmed the tide of refugees into Greece. The EU is the source and guarantor of this agreement, as well as of the funds that have enabled Greece to house the refugees it has been forced to accept. It has no way of dealing with this problem on its own. To be sure, the agreement with Turkey may not hold; it is widely perceived as a cynical bargain on both sides that has severely tarnished the EU’s image, and may even prove its undoing in the end. But chaos in the Mediterranean is in no one’s interest other than ISIS’.

The long-term goal for Greece—the end of austerity, social and economic reconstruction, and the recovery of national sovereignty—is clear. A few months, even a few weeks ago, this all seemed the dream of a distant future. Now, suddenly, it appears almost within reach. But the road ahead is unpredictable, and may yet be long. Nor can anyone be sure what kind of Europe awaits at the end of it.

About Robert Zaller 56 Articles
Dr. Robert Zaller is an American author, playwright, and professor of history at Drexel University. An authority on British political history and constitutional thought, he writes extensively on politics, modern literature, film, music and art. He has been a Guggenheim fellow and a fellow of the Royal Historical Society.

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