13 07 2015

It's time for Britain and Germany to join forces - and push Greece out of the euro

David Cameron could have a powerful ally in Angela Merkel if he will stand up against the ludicrous trick the Greeks have played on us all

Many months ago the recently departed Greek finance minister, Yanis Varoufakis, made a very astute observation. He said that when it comes to settling the Greek crisis: “Whatever the Germans decide, it will be the Germans who pay.” This was, as it turned out, not just a turn of phrase, but a brilliant piece of strategy – a plan for how to win the game that has unfolded since.

What Greece has not done is change its own behaviour. At the outset Greeks moved money to Switzerland, to Luxembourg, to shelter their cash from tax. Then, when it became clear that actual reform was required, Greece approached all the financially weak countries in the EU in an attempt to form a coalition against Germany. This too, failed. So Greece started talking about the Second World War, playing games of guilt, not reform. Germany was hugely upset, but still the tactic failed. Then Greece raised the threat of it becoming a client state of Putin’s Russia, or China. Anything but embrace the reality, and necessity, of reform.
In negotiations they didn’t submit their position papers – at least not on time. Even their clothes were a statement that they played by different rules; we in suits, they in leather jackets.
They were, in other words, very, very good strategists. They got their money from the ECB, they got the French and all the others who are indebted and don’t want to make reforms either – they got them on side. It was a brilliant move to say they would have a referendum. Who in the EU could argue with that and maintain some shred of commitment to democracy? I would go so far as to say they have made only one mistake until now.
This mistake was to campaign for “No” in the referendum. It was a move that united everyone in the EU in anger. So Varoufakis was sacrificed, and made to ride into the sunset on his motorcycle.
What Greece has realised, above all, is that rather than reform, the financially weak countries in Europe want someone to blame. France and Italy too want someone to blame. Who will it be? Germany, of course. The German piggy bank must be smashed to pay for their non-reforms. And while we in Germany feel angry about this, we also feel bad as pictures flood in of people who say they are dying without medicine or food.
What is the answer? It is this. People say that if Greece leaves the euro, it will be a great defeat for the single currency. But the fact is that the real defeat will come if Greece wins and does not leave the euro, and for the same reason: trust. The trust that the euro is a currency based on rules will disappear.
What Europe needs is the common sense of Germany, Austria and the Netherlands to bring order to a EU which is out of order and led by a failure. David Cameron was right about the commission president, Jean-Claude Juncker.
We must realise that Greece has neither the structure nor the readiness to be a partner in the euro. And we must solve the crisis for the long term, not stumble from debacle to debacle. The European Union is about more than simply demanding money from Germany. It needs to be reformed. So I implore the government of Britain to take a leading role in this, not retire from it.
Germans are on your side. Polls in our most popular newspaper, Bild, show that German scepticism about bailing out Greece is currently running at 80 per cent. Even political and academic sentiment here is building that we should create a new EU – and start by letting Greece go, and helping it to introduce the drachma.
The fact is that Europe must be strong to face Russia and crisis in the Middle East, and an immigration problem to which we have absolutely no solution at all. We need a common policy to all this. What we do not need is to be a victim of a brilliantly executed game by Varoufakis and his Greek friends. They are very good at this. Let us not forget that strategy is a Greek word.
Chancellor Merkel’s problem is twofold. If she hands over the money that Greece is asking for, she will lose the consent of her people. But if she does not give Greece the money they want, she will have France and Juncker and everyone else saying that German austerity killed Greece.
The reality is that Merkel is much closer to Cameron than she states publicly. She is not a euro-romantic. She believes, however, that this is her chance to create a stable, powerful Europe, one that can only be achieved through reform.
It really is a make or break moment. For if we bail out Greece, why not France or Italy? We are embarked on a very dangerous game and my opinion is clear that we should stop. There are too many states who think only of their empty pockets.
Britain can help settle this. It is a real opportunity for Cameron. He could become a powerful, leading voice on how to shape a new Europe. He has won the election, now he can show that Britain does not rules the waves, but can calm the waves in Europe. For there is common thinking beginning to emerge between Berlin and London. France is too weak to resist – she will join us. It is the hour of Europe. It is the hour of Britain.