Europe: 'Events have overwhelmed us'

  • 20 June 2011
  • From the section Europe
  • comments

The action/reflection time-cycle is now very short with the Euro-crisis. Already it is Monday and I am still rinsing the teargas out of Friday night's washing load. In politics and diplomacy things are similarly crushed.

This morning the Eurogroup has issued a statement on Greece which I summarise:

"Right, that 12bn you need: you're not going to get it unless the Greek parliament agrees to some form of new austerity plan. So yes, technically we are prepared to make you bankrupt over 12bn but read on (hint, this is brinkmanship).

"Actually 50bn privatisation plus structural reform is the key; we're inviting voluntary rollovers of debt but there will be no default event triggered by EU/IMF action. Greece has to pass an austerity budget that gets us off this hook but we don't really care what it looks like.

"By the way, we would quite like a government of national unity because we are terrified of the mood of mass discontent and would prefer it did not spread."

(Read the actual text here).

The second bit of mood music I take away from the weekend is the word "gloom" constantly appended to the thoughts and statements of Angela Merkel. As she put it:

"We wouldn't be able to control an insolvency; we all lived through Lehman Brothers. I don't want another such threat to emanate from Europe."

But if the banks and investment funds (and hedge funds who've taken a punt on the Euro's survival) are not to be made to lose money who does?

Apparently French and German industrialists are taking out a one-page ad in all the papers urging the politicians and people of Europe to "save the Euro" - by way of softening public opinion for the inevitable transfer of tens of billions of taxpayers' money to the peripheral economies.

Having established the metaphor of pre-1914 Europe (see here) I will stick with it. The internationalists and anti-war movements expected there to be a general strike and mass protests on Day One of the First World War: instead the working populations of Europe rushed to the streets in mass jubilation, calling for immediate victory against each other.

Their dreams shattered, the activists turned to their leaders for an explanation. In France, the Socialist Party - in mid-flipflop between pacifism and bellicosity - delivered the immortal line: "Events have overwhelmed us."

The phrase is beginning to seem apposite today.