Perhaps it is time for the geographically lower European countries, the southern tier of the European Union, to look elsewhere for a way out of their financial dilemma by abandoning the Eurozone and create their own economic market. Their current dependence upon the euro has not been a positive economic panacea.
The northern European countries are nations of heavy industries, whereas the southern tier has been of light manufacturing, with the somewhat exception of Italy primarily due to its automotive works. Added to the condition is the economic strength of modern Germany, due almost exclusively to the fact that throughout the Cold War it was the United States which supported Germany’s defense against the Soviet Union fear totally, providing it the opportunity to develop itself without the heavy expenditures of defense costs.
The unevenness of light manufacturing versus heavy industries has been detrimental to the economies of the Southern European countries from Portugal across the Mediterranean to Cyprus. All these partners are suffering from the same economic disease, the inability to compete evenly with their northern associates. Added to the dilemma is German dominance and heavy pressure on these countries, resulting in Germany’s economic favor. Germany’s labor force is expounding that current economic conditions are very favorable, resulting in enormous opportunities to its workers. One of its major successes is that Germany does not have an unemployment situation, at least not yet. However, given that the jobless of the southern tier seek work in Germany, under their right as European Union citizens, Germany itself might begin to falter from a greater job-seekers number than needed.
The severe austerity measures placed upon the suffering southern tier nations have created conditions of social disarray as well. Although the southerners seek the north’s assistance, they also disdain the fact that the measures imposed upon them are punitive, while at the same time enriching the enforcers. Their attitudes bring back memories of past injustices, creating social anomalies to the level of Nazi reminiscence.
Current indicators suggest that the southern tier will need several decades of austerity to return to better conditions. There is also the concern that at least some might not make it regardless of aid; might declare bankruptcy; might be expelled or leave the euro on their own; all conditions that will make matters even worse.
What might be a situation if the ‘light-industries’ southern European nations decided to abandon the euro and seek a different route? Yes, such tumultuous approach will have heavy repercussions, at least initially, but in the long run it should prove less stressful than the current ‘no light at end of the tunnel’ predicament, especially when no tunnel is even in sight.
Portugal, Spain, Italy, Malta, Greece, Bulgaria, Romania, and Cyprus can form a “Mediterranean Common Market,” depending upon their industrial capabilities, of course quite different from those of the northern tier. Certainly one of their industrial capacities will be tourism to their beautiful and sunny lands, along with their fine agricultural products of fruits and vegetables scarcely growing in the cold North. Also, light manufacturing not competing with the heavy North, should enhance industrialization and their productivity of other unique goods.
The value of the southern-tier currencies would be a major factor in the reconstruction of their economies. Perhaps the safest route would be for all the members to revert to their own currencies, but through their common market to establish their values on an equivalent rate.
There is also the recent element of fossils energy discovered in the Mediterranean waters. Greece and Cyprus, along with non-European Union Israel, are found to possess huge amounts. If the Eastern tier of the Mediterranean has such wealth, the Western might need to be explored as well. Just like the Arab peninsula works its valuable wealth, so can the Mediterranean basin.
There is also an additional ‘trump card’ that might be exercised. Israel is a European country — and mostly a southern-European country — in every aspect of its society other than its geographical location in the Middle East. Israelis have been throughout the Northern Mediterranean for eons. Their modern scientifically-oriented society is of high level and can be a very favorable partner to a Mediterranean Common Market, and vice versa. The very large energy deposit discoveries in its exclusive economic zone, connecting to those of Cyprus which connect to those of Greece, can provide a working relationship of immense opportunities, and develop closer ties of all aspects for social interaction as well with its Mediterranean Common Market partners. Israel will have much better success with the northern Mediterranean countries than it would have with the Obama ill-forced, supposed re-rapprochement of Israel with Turkey. Turkey can never be trusted to deal fairly with any dealings that it makes. Its record of broken accords is laden in the annals of history, not to disregard Turkey’s disdain of and for Judaism, due to its own Islamist religious orientation and social mores of Muslim tenets.
Doris Day’s famous song of the fabulous 1950s – “Que Sera, Sera” (‘What Will Be, Will Be’) is most appropriate here. Certainly no one knows “what the future will bring.” But to sit by idly, suffering under intense conditions without considering and trying something new is not a viable solution either.
As the Ancient Greek advice provided: “Syn Athena kai heira kinei – Pray to the goddess Athena to save you from drowning, but use your arms to swim, too,” so should the Mediterranean European countries consider alternatives in a united manner to locate that tunnel and see the light at its end.
Dean C. Lomis, PhD, was Professor of Modern Greek and Director of International Center at the University of Delaware.