European solidarity requires a deal to solve debt burden

Lucinda Creighton, The View

As the standoff between the European Union (EU) institutions and Greece enters a third week, it is apparent that both sides cannot afford to cede ground. A huge amount of posturing and gamesmanship can be expected in the days, weeks and months to come. It is unfortunate that such an existential crisis for the whole of the EU can be reduced to such simplistic political games.

The truth is that there is wrong on both sides. There is also right on both sides. To find a lasting solution, one which is good for Greece and good for the whole of Europe, some objectivity and perspective is required.

The accusations which are regularly levelled at Greece, are in many respects true. It is a country which has struggled to develop a thriving and tax compliant enterprise sector, it has suffered from high levels of corruption and tax avoidance and it has allowed its public debt levels to grow to unsustainable levels (even before the global crash in 2008).

However, there is something distasteful, and plainly wrong, about other EU countries – including Ireland – sneering at Greece and suggesting that we want to keep as far away from them, politically speaking, as is humanly possible. After all, haven’t we all struggled to cope with the financial crisis, the banking crisis and the debt crisis that has engulfed the Eurozone for the past six years? Haven’t we all suffered as a result of the unyielding orthodoxy of the European Central Bank (ECB)?


Whether we like it or not, none of us is a million miles away from the Greek crisis. That is the nature of Europe, especially the Eurozone. We are interlinked.

The word ‘solidarity’ sums up what the European project is all about. It means that we are all in it together, that the problems of our neighbours are our problems and that ours are theirs. Unfortunately there is less and less of a sense of solidarity across Europe since 2008.

The ECB has ventured into the realm of political decision-making in a way that was never envisaged by the EU treaties. The countries on the ‘periphery’ of Europe have been treated as profligate and wasteful, while the economies of the ‘core’ countries of central and northern Europe have been held out as virtuous role models. If only it were that simple!

The reality is that the EU and the Eurozone are made up of diverse nations with diverse economies – there is no one size to fit all. This is the first reality which we must accept if we are to put an end to the ongoing and pernicious crisis in the Eurozone.

While the solution for Greece is not, as Syriza, the Communist/Trotskyite party which recently entered Government, might claim, to stop reforming the economy and start spending money they don’t have, nor is the solution to drown in a sea of debt.

There is a halfway house, which would see countries like Greece and Ireland reduce their debt burden so that they can emerge from oppressive debt levels, and see some light at the end of the tunnel.

The key to ensuring a successful revival of the Greek economy while maintaining the financial stability of the wider Eurozone area will therefore be quickly putting in place a flexible yet clearly-defined programme of recovery. While an outright write-down of Greek debt is unlikely to sit easily with the country’s creditors, there are a number of alternative measures which could be implemented to ease the immediate pressure on the Greek people.

The manner in which Greece is treated now will not only directly affect those countries presently struggling with debt, it will also set a precedent for how such cases are to be dealt with in the future. Any deal which Greece negotiates will be of enormous importance to Ireland and the wider Eurozone. It is, therefore, of critical importance that any arrangement is not merely decided by Greece and her creditors, but that there is a positive input from other member states which proceeds on the basis of consensus.

The Eurozone crisis is something which has affected every country in the EU, from Ireland in the Atlantic to Greece in the Mediterranean. If we are to truly embrace the spirit of mutual respect and co-operation which is at the heart of the EU, we must work together to reach a solution which is both equitable and achievable. For that reason I support the concept of a Europe-wide debt conference.

By coming together to discuss the problems with which we are faced, the prospect of reaching a workable and broadly-accepted solution is greatly increased. Rather than adopting a polarised view and demonising one side or the other, we should give concrete expression to the principle of European solidarity by considering the needs and desires of both the debtors and creditors.

This is the only way of reaching a solution which reflects the interests of the entire Eurozone.

The imminent need for European co-operation to resolve the Euro crisis belies the relative lack of integration at a supra-national level which has led us to the present precarious situation. The continued survival of the single currency now seems increasingly dependent on the development of a genuine banking union between all Eurozone countries.

If we want to keep all the benefits which stem from Eurozone membership, we must be willing to work constructively with our fellow Europeans to ensure a uniform framework of banking regulation.

A willingness to work collectively towards common goals has been a hallmark of Ireland’s participation in the EU. We must continue this legacy by working alongside our European partners to bring about both a fair resolution to the Greek debt crisis and the implementation of co-operative regulatory framework to ensure such a crisis can never happen again.

Vilifying our neighbours in Greece may make us feel like the best children in the class, but it does nothing to end the vicious cycle of stagnation and unemployment in Europe.

To secure recovery for Ireland and our people, a new Europe-wide resolve to work together to solve the legacy debt burden that hangs around our necks is the smart solution. Ireland should not be shy about advocating for such radical solutions, rather we should be first in line arguing for them. It is undeniably in our interest to do so.