The feared Greek collapse and subsequent exit from the Euro has governments all over Europe up in arms. The European Union until now acted according to the Musketeer mantra “One for all, all for one”. If one government seemed to go down all the others would come to the rescue. The looming Greek collapse has changed all that.
Christine Lagarde, the IMF head, said today that she had no sympathy with the Greek as they did not pay taxes and felt more sympathy with African children. This seems to be the prelude to a hardening stance of the European leaders.
The British government are apparently drawing up plans for emergency immigration controls to curb an influx of Greeks and other EU residents if the Euro collapses. In case this might happen millions of Greeks (and other Southern Europeans) might lose their jobs and because of their right to work anywhere in the EU they are feared to migrate to other EU countries where they might be able to find a job.
Other EU countries are allowed to close their borders for a short period of time under exceptional circumstances. If this were to happen, the free movement of people in Europe would be severely limited. This has so far been one of the cornerstones of the single market and if it is put in place working anywhere in Europe would become significantly more difficult as people from some countries would be forced to apply for visas and work permits again.
It looks like Kondratieff’s economic theory is spot on and we might be in for massive upheaval and dramatic changes to the European social and economic landscape over the months/years to come. The various national standards in Europe need to be adjusted so they are all on the same playing field. This means that either Germany and the Northern European countries have to lower their standards to Mediterranean levels and become more corrupt or the Mediterranean countries should clean up their act and become as efficient as the Northern countries.
It looks like neither will ever happen, so we’re in for some dramatic changes. I don’t think Europe will be going to war over this, but the upheaval will be dramatic and very unsettling. Wealth and poverty will be more polarised and the European Union might turn out not to be that united after all.
Let’s hope politicians will clean up their act and start seeing the danger and foolishness of their actions. I don’t have high hopes though as politicians tend to not understand economics and the further south you go, the more they promise to get into power only to totally forget their promises when they are at the levers of power.