Thursday, August 16, 2012
Germany, Not Greece, Should Leave the Eurozone
August 15, 2012
There's much talk of Greece leaving the euro. The current Greek government has almost certainly failed to implement the austerity measures necessary for future bailouts, and the left-leaning parties of Greece continue to cling to the myth of eurozone membership without austerity. Italian and Spanish membership of the euro is also increasingly in doubt, thanks to record levels of borrowing and government spending.
Germany, one of the only countries that has enjoyed any growth recently, has been the main source for much of the financial assistance enjoyed by so many of its European neighbors. Although Chancellor Angela Merkel is against any country exiting the euro, some of her colleagues are not so committed to the single currency. Some members of the coalition government have openly said that if Greece is unable to implement the necessary austerity measures, then Germany should veto any further assistance. Such a move would force Greece out of the eurozone, setting a worrying precedent for countries like Italy, Spain, and Ireland.
Despite all the talk of eurozone exits, one possibility hasn't been raised nearly enough: the possibility of a German exit. Such a move would not only be economically advantageous to Germany and the rest of Europe in the long run, it would also be one of the few morally justified exit strategies available.