Sunday 21 June 2015 10:39 pm

The EU is dead: The Grexit crisis has laid bare Europe’s inability to rescue itself

Jumping the shark” is one of my favourite American idioms. It was first used in the context of a particularly notorious episode of the 1970s classic US television show Happy Days, which centred on the unlikely but enduring friendship between a young, square, 1950s good guy, Richie Cunningham, and his cool, but from-the-wrong-side-of-the-tracks ally Fonzie. For five seasons, the show’s good-hearted premise worked, as Richie’s decency and Fonzie’s coolness managed to vanquish the daily travails of life. However, in one revealing moment, the basic preconceptions behind the show were fatally called into question. An absurd plotline had Fonzie water-ski (complete with dorky life preserver) over a series of sharks. In an instant, it was glaringly apparent to everyone watching that the show was a fraud; Fonzie wasn’t cool at all. In a nutshell, that is what has happened to Europe over the endless Greek crisis. A full decade ago, I wrote an article for the US foreign policy journal National Interest with the provocative headline “The EU is dead”, comparing what its cheerleaders said to the stages of coming to terms with death pioneered by Elisabeth Kubler-Ross. At the time, “serious” people were sonorously intoning that Europe, through the use of its soft power, was on course to dominate the twenty-first century as the most important global power, an entity so admired it was bound to be copied throughout the world. Where my friend and co-author Will Schirano and I saw only economic sclerosis, a fatal democratic deficit, and puny military assets, others were outraged that we “didn’t get with the programme”. As such, I have watched with horrified amusement as even Europe’s most blind cheerleaders have deserted the sinking ship over the now very real prospect of Grexit. It truly is the moment where perception has at last caught up with geopolitical reality. To run a successful great power in the rough and tumble world of global politics, three basic attributes are necessary: a decisive strategy must be formed and consistently adhered to; a plan must flow from this strategy; and lastly this policy must be implemented in a timely manner. On all three counts, Europe has shown itself to be laughably incapable. For whatever the outcome of the immediate crisis – either Grexit or the ritual kicking the can down the road – Europe has shown itself to be decadent, entirely unable to solve its own basic problems. Germany, epitomised as ever by the unbelievably over-rated Angela Merkel (name me one proactive and brave policy you can attach to her name over the past decade, I dare you), has made a religion out of dithering, neither moving decisively to shore up Greece or cutting it adrift, thereby satisfying no one. The first step in solving the Greek crisis (and assume the gormless Marxist fantasists in Syriza will never embrace real structural reform) is for Germany to answer one basic question: if it is so worried about economic union becoming merely an exchange rate system, is it prepared to buttress Greece with debt relief in return for whatever reforms it can get? If the answer is yes, it should have done this months if not years ago. If the answer is no, a managed Grexit (as has been quietly espoused by finance minister Schaeuble) should have been implemented ages ago. The second step is that policy reflecting this German strategic decision should have been quietly agreed to by the other actors in the crisis (IMF, Commission, European countries) early on, in one of the endless series of meetings European leaders have indulged in. Instead, they have fundamentally confused talking with “doing something”. Which leads us to the third problem, the colossal waste of time this has all been. For as long as I’ve watched the place, it is this last drawback that I have suspected would ultimately doom Europe’s great power ambitions. It lumbers about like a dinosaur, rather than an adaptable and fast moving mammal, long after the asteroid has hit. It simply cannot react quickly enough to formulate policy in real time, in a world that waits for no one. Merkel, again the poster child for ineptitude, has long confused moving slowly with moving wisely. So at last everyone sees it; Europe has jumped the shark over Grexit. Far from being a great geopolitical power, it is an open question as to whether Europe will remain any sort of power at all. Perception is an important part of geopolitics; analysts around the world will be scrambling (though it’s long been apparent) to catch up with this suddenly obvious geopolitical hinge point.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.