The Day the Greek Debt Crisis Really Got Serious

The European debt crisis, personified by (but by no means limited to) the very real possibility of a collapse of modern Greece as we know it, has taken a subtle but game-changing turn.

Noah Barkin begins his recent analysis of the "Greek situation"—an article that represents, incidentally, a rare moment of lucidity in English-language press coverage of the European debt crisis—with the rather dramatic suggestion that the admission by French and German leaders that Greece leaving the Eurozone is now a real possibility may one day be seen by history as "the day the Eurozone began to break apart."

Dramatic, yes. Crazy? Not at all.

Throughout this whole nasty business I've spent a considerable amount of time and energy reassuring American friends and family that the European debt crisis was no more of a threat to the existence of the euro than its bad-mortgage American counterpart was to the existence of the dollar.

As Barkin correctly points out, however, that all changed Wednesday night on the eve of the G20 in Cannes, when Angela Merkel and Nicolas Sarkozy came out of a meeting with Greek Prime Minister George Papandreou—the guy who brought this all to the surface last week by announcing a referendum to determine whether or not the Greek people even wanted continued European aid, a truly shocking development—singing a different tune than the one emanating unanimously from official Eurozone sources since the crisis began in earnest last spring: A Greek exit from the common currency, heretofore dismissed as legally and practically impossible, is now part of the discussion.

You can read Barkin's article for yourself, which outlines some of the more severe potential consequences of a Greek exit from the common currency, but the broad strokes are easy enough to discern: if Greece leaves the Eurozone, nothing will ever be the same again and no one can say what a euro will be worth—or even mean—in the months and years to come.

As someone whose pay, pension, savings and property are mostly valued in euros, this is all mildly distressing to me. Never mind that Papandreou has withdrawn his call for a referendum—now regarded by many as a dangerous political gambit—and that cooler heads are once again trying to find a way to save Greece from economic, social and political implosion: the united facade, spackled and roughshod though it may have been, is now broken. You can't un-say what's been said this week, and you can't take away the voice that has now been given to legions of short-sighted Europeans who believe that an orderly Greek exit without negative Eurozone-wide consequences is possible.

Maybe I'll go spend all of my euros on wine and cheese then use them to barter for food and protection later...you know, when the banks fail. That seems like the rational thing to do, doesn't it?

Posted in: EARTH CHANGES,ECONOMIC,SOCIETY,WORLD