By Jeremy Warner at The Telegraph
Is there no limit to the economic pain Europeans are prepared to endure in defence of the wretched euro? Apparently not; despite the brinkmanship and bravado, even Greece’s notionally radical left prime minister, Alexis Tsipras, eventually opted for continued membership of the single currency, and the austerity that goes with it, over economic self-determination and a plausible path back to growth and full employment.
Barring last-minute political upsets, a third Greek bail-out will shortly be implemented. Few, even among those who have agreed the latest rescue, believe it provides the basis for lasting solutions, even if later concessions include permanent debt relief.
As the political philosopher John Gray recently concluded in a compelling analysis of the single currency’s fate, “unworkable and unreformable, the euro can only produce recurrent and worsening crises”.
Yet the euro as it now stands will eventually die not of the financial traumas that first threatened its existence, but of political contagion, with the single currency paradoxically spawning exactly the same kind of resurgent nationalism, popular anger and political instability it was designed to eradicate.
For the moment, however, Europe’s disastrous experiment with monetary union is proving surprisingly resilient. With each recurrent crisis, just enough is done to hold it together. Delusional faith in the euro being in some way Europe’s unavoidable and manifest destiny is not confined to the policymakers with a vested interest in trying to keep it alive. It is shared by a clear majority of Europeans.
I’ve recently returned from a holiday in Italy where I was astonished to discover that after seven long years of more or less perpetual recession, support for the euro remains pretty much rock solid among otherwise rational, well informed people.
As it happens, Italy is one of only two eurozone members – the other being Cyprus –