The latest developments in the eurozone financial crisis have seen Greece go to the polls to decide upon the acceptability of yet another loans agreement – messy small-print duly included – and much of the analysis on this topic has focused on familiar tropes: the implications of the referendum result for Greece’s continued participation in the euro; the value of that same currency; and even the possibility of the European Union losing a relatively minor but deeply symbolic member country.
But it is the mundane reality of events on the ground which have got we at Mediolana in a contemplative mood. With capital controls in place to avoid the Greek economy haemorrhaging cash, international bank transfers have been suspended and imports of some basic items – including sugar, flour and pharmaceuticals – are starting to become scarce. Developments like these are introducing a whole new round of uncertainty into everyday existence.
This dysfunctional world of bank runs, shortages and epic political instability may seem distant to onlookers in Northern Europe or the costal cities of the United States. But the question still needs to be asked: is Greece really as sui generis as we would like to believe? It is certainly true that it has a long history of fiscal imprudence, embedded institutional corruption and – perhaps most damningly of all – a taxation system that barely impinges on the privileged oligarchical class. It is also true that with a population of ten million people and a limited industrial or natural resources base, Greece was always going to have to punch above its weight in precisely the areas in which it has fallen short to avoid long-term decline.
But there are plenty of countries (and indeed entire regions) with basic economic problems: budget deficits, political corruption and tax systems that virtually or literally subsidise the already fabulously wealthy are hardly Greek inventions. Greece may not even be the worst nation in the eurozone according to these metrics; in the world beyond the eurozone, places with all kinds of deep flaws which are anathema to high economic performance are not being forced to wrestle with austerity owing to flagging stakeholder confidence.
Ten years ago this weekend, the Greek national football team won the 2004 European Nations Cup. Today, the country seems to be pioneering the ‘paupers with smartphones’ economic model, and its very viability is openly being questioned. That such a transition can happen overnight in historical terms should give those in supposedly superior polities pause for thought.