Niall Ferguson guesses Europe's greatest power will soon acquiesce to the inevitable [pay-walled at the Sunday Times]:
It is still possible that the game of chicken between Athens and Berlin ends with the two cars colliding. But my sense is that both will swerve at the last minute — the Greeks because they see the costs of exit would be catastrophic for them, and the Germans because — if they don’t realise it already, they pretty soon will — the banking crisis that this would unleash as deposits fled the periphery would be highly destabilising for the whole eurozone, Germany included. The Greeks say, ‘We’re not going to comply with our commitments’. The Germans say, ‘Then you’re out’. They’re both bluffing. … I think that’s one of the reasons Germans will swerve in this game of chicken, because anything that threatens monetary union is pretty threatening to German business . . . Germans are going to have to make some kind of concession to the periphery. It’s not enough just to say ‘austerity, austerity’.
In some ways, you can see the current crisis as a critical error in the construction of a united Europe. On the other hand, you can see it as a necessary step, implicit in the very beginning of this stealthy attempt by European elites to corral their populations into a new super-state. How to talk the German electorate into the final product:
Here’s the choice, Mein Herr. You accept the logic of the Mitterrand/Kohl era, which always was ‘we’re having monetary union in order to get to a federal Europe’ . . . The logic of the 1990s was that ‘monetary union will force us to evercloser fiscal union, which is hard to sell politically, but we’ll make it happen — we’ll back into it through a monetary union’. That always was the model — which was one reason for being against it as a British Eurosceptic. Now we’re at the moment of truth when you can no longer maintain the fiction that a monetary union can exist independently of a fiscal union … On the other hand — and this is the message to Angela Merkel — to use George Bush’s phrase: this sucker’s going down. We’ve reached that point.
I agree with Niall. In the end, Germany has to surrender, or face catastrophe. And when it surrenders, it will de facto be the unwilling but indispensable power-center for a newly integrated United States of Europe. And what will Britain do then?
(Photo: US President Barack Obama greets German Chancellor Angela Merkel upon her arrival at the Camp David presidential retreat in Maryland on May 18, 2012 for the G8 summit. By Brendan Smialowski/AFP/GettyImages.)
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