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The Euro-zone in crisis

Neo liberalism is in crisis: Discuss…

If only I were back at university and being asked this question by one of my lecturers! Neo liberalism is in deep crisis, as the prospect of economic depression on the back of the Euro-zone break down becomes more apparent. So while it would be fun to write the sort of “I told you so” piece that would delight your average left leaning lecturer, the reality is that we no longer have the luxury of discussion and debate.

Should Greece default and leave the Euro-zone which seems increasingly likely, the Lehman Brothers collapse will look like a tea party. Should Greece default? Well, yes it should because ordinary Greeks are being made to pay the price of easy credit, bankers greed and a single currency that was the creation of economic illiterates. No allowance for devaluation? Most Greeks are praying for the return of the Drachma.

And why should ordinary taxpayers from across the Euro-zone – and outside it in the case of Britain, have to stump up for the Greek credit boom and the greed of the banks in encouraging it? For the Greeks who never wished this situation on themselves, the price of more Euro loans that will never be paid off, the price is jobs losses, wage cuts, pension freezes, privatization and the sort of austerity that has had thousands on the streets of Athens and other Greek cities for months – although you might not know it from the general lazy media black out.

Britain fortuitously did not join the Euro-zone. Some us were vociferously against joining at a time when the neo liberal cacophony to do so was at its height. Back then we were labelled little Englanders and anti Europeans. Fortunately, again, the UK Treasury, then presided over by Chancellor Gordon Brown, allowed caution to prevail. Tony Blair, Paddy Ashdown and most of the neo liberals who have controlled British politics and the media for over a quarter of a century were all in favor of joining the Single Currency. This was perhaps their only defeat.

Don’t get me wrong, I have no wish to see the Euro-zone collapse in chaos. There is nothing noble in watching millions of people struggle through another 1930s depression. But the trouble is that the European political class – including the British political class — no longer know what to do, even if in their arrogance, they claim that they do. The Euro-zone may be about to collapse for all its internal contradictions – which should give all of us the opportunity of finally clearing out the political Augean Stable.

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