Before we can fix Greece we have to understand the nature of the problem. What is wrong with this nation-state?
What are we to make of Greece, which borrowed beyond its means and now has been pushed to the brink by its lenders? Is it the “problem child” of Europe, more corrupt and dysfunctional than its neighbors? Is it a special case, as the lenders are saying, hoping that after the write-down of Greek debt last week they won’t have to restructure other ailing euro zone countries’ large public debts? Or is it in fact a harbinger, a vision of how economic collapse transforms a country — or of what happens to democracy when banks become more powerful than political institutions?
While the mainstream political parties suffer under the weight of their own mismanagement and of the austerity they have pledged and reforms they have often struggled to enforce, unemployment and homelessness rise and the European Union inches toward transforming its institutions to get behind a currency battered by fast-moving market forces. Something profound and distressing is happening: the rapid dissolution of a democracy in plain sight. As I stood outside the Attikon last week, I asked myself: Where is the line between a weak state and a failed state?