At first, Jean-Claude Juncker was just jabbering about Greece. No, he couldn’t categorically exclude its exit from the Eurozone, he said, but it wouldn’t happen “before the end of autumn.” With these words, he might have thrown the markets into vertigo-inducing tailspins a year ago. But Monday, during an interview on German TV (transcript), the Prime Minister of Luxembourg and President of the Eurogroup—where the finance ministers of the Eurozone manage the political ends of their currency—wasn’t ruffling any feathers; and markets went up. That’s how far the Eurozone’s debt crisis has advanced, after 21 summits to save the euro, and after two bailout packages to save Greece.
The French President and the Prime Ministers of Spain and Greece had called him that morning and kept him from getting any work done, he mused. It was that kind of conversation, self-aggrandizing in a quiet way. Then he plowed into sound-bite happy politicians, particularly those who were pushing for a Greek exit, such as German Vice Chancellor Philipp Rösler who’d proclaimed that such an event had long ago lost its horror. “It would be good if more people in Europe would shut up more often,” Juncker explained.
Nevertheless, a Greek exit would be “a manageable process,” he said—confirming Rösler offending sound bite of a couple of weeks ago [read.... Smashing The Can Instead Of Kicking It Down The Road]. But it would entail significant risks, “particularly for ordinary people in Greece.” To show just how close to his soul they were, he added, “I do care what happens to these mountain farmers in Greece. Maybe Mr. Rösler doesn’t care, but I do.”
Then he lamented that “many Germans and the German media” talked about Greece as if it were “a people you couldn’t respect”; and that Greek tabloids depicted Chancellor Angela Merkel as if she were “the heiress of the Nazis.” History, and “what we thought had been definitively buried, very quickly rises again,” he said. “European integration remains a highly fragile story.”
He’d hit the nail on the head. European integration, a vague intellectual construct for the people on the ground, has been the elite’s dream for decades. And now their handiwork appears to be sinking into the morass of budget deficits, excess debt, and national priorities. What a hoot it would have been to bring all these people with their dozens of languages and diverse cultures into one grand organization under one government, run by a few mostly appointed politicians and bureaucrats, at the top of whom would be, why not, Juncker himself and of course the inevitable Merkel.
But he goes deeper. Southern Greeks knew nothing about northern Germans or the Lapps, and vice versa, he said, which left politicians to lead the continent based on the “fundamental agreement that we must work together,” but alas, without knowing anything about “the living conditions of others.”
And what about sticking together against colossi such as China or India? Suddenly, his dark pessimism, and realism, burst to the surface. Forget Greece. This was about the future of a dying continent.
“We’re small, and we’re becoming weaker,” he said. The floodgates opened. Was he trying to scare the uppity Germans into obedience? “We’re not numerous enough, we’re declining in number, we’re losing economic power, and if we don’t have this common currency, politically we won’t have any significance.”
Significance. Who cares what the mountain farmers in Greece want. Juncker and his ilk want significance. They already have everything else. He wants to transcend the limits of his political future, being at the top of a tiny but immensely wealthy country, and being at the top of a frantic monetary union.
“Europeans are dwarfs,” he said. But he had a solution. The one that would reverse all the scourges he’d just mentioned: “We must show the world something giant, and that’s the euro.”
He explained his vision: “The only solution” would be that “we as Europeans move closer together.” And not just within the EU, whose 27 countries rarely agree on anything, but “the total continent, with extensions.”
These “extensions” would be beyond the European periphery, such as Turkey, whose people have even less in common with this notion of Europe than the people who are already part of it. How that would promote tighter integration as seen by the people on the ground, rather than the bureaucrats in Brussels, remains to be seen.
Last year, German exports rode to a new record, jobs were plentiful, real estate boomed, the federal budget was nearly balanced, and consumers felt good and spent money. But now, the German export machinery is shifting down with an ear-piercing screech. Read.... The German Economy Caves, And Eurozone Bailouts Take On New Dimensions.