A "Safe European Home"?

Riots in Spain & Greece, mass protests all over the rest of Europe - what's really going on here? Blaming this on the latest global financial meltdown is too easy, more a symptom than really a root problem. Why? Because the people of Europe have been promised a "safe European home" by their political leaders, and the leaders, from Lenin & Lloyd George to Merkel & Papandreou, for the last 90+ years - and they have failed to deliver. Therefore, hey... the people are pissed off.

In the grisly aftermath of World War I, European politicians were eager to guarantee, as best they could, a world safe from the death & destruction of war. However, the result of the Treaty Of Versailles only guaranteed a resentful Germany.

The Treaty of Versailles was neither lenient enough to appease Germany, nor harsh enough to prevent it from becoming the dominant continental power again. The treaty placed the blame, or "war guilt" on Germany and Austria-Hungary, and punished them for their "responsibility" rather than working out an agreement that would assure peace in the long-term future. The treaty resulted in harsh monetary reparations, millions of Germans turned into minorities in neighboring countries, territorial dismemberment, mass ethnic resettlements and indirectly hampered the German economy by causing rapid hyperinflation - see inflation in the Weimar Republic. The Weimar Republic printed trillions to help pay off its debts and borrowed heavily from the United States (only to default later) to pay war reparations to Britain and France, who still carried war debt from World War I.

The treaty created bitter resentment towards the victors of World War I, who had promised the people of Germany that U.S. President Woodrow Wilson's Fourteen Points would be a guideline for peace; many Germans felt that the German government had agreed to an armistice based on this understanding, while others felt that the German Revolution had been orchestrated by the "November criminals" who later assumed office in the new Weimar Republic. Wilson was not able to get the Allies to agree to adopt them, nor could he persuade the U.S. Congress to join the League of Nations. The result was A Germany ripe for Adolf Hitler to exploit. The recounting of Hitlers crimes during the war need not be done here, as it is an expansive & well understood topic of it's own.

The destruction of Europe and the destruction of a significant portion of the United Kingdom's cities (via aerial bombing) would also ruin the reputation of the imperial nations in the eyes of their colonies. Coupled with the enormous expense incurred in the war, an empire was perceived to be an unnecessarily expensive possession. This would enable the rapid decolonization process that would see the empires of the United Kingdom and others swept away.

The European Union grew out of the European Coal and Steel Community (ECSC), which was founded in 1951 by the six founding members: Belgium, the Netherlands and Luxembourg (the Benelux countries) and West Germany, France and Italy. Its purpose was to pool the steel and coal resources of the member states, and to support the economies of the participating countries. As a side effect, the ECSC helped defuse tensions between countries which had recently been enemies in the war. In time this economic merger grew, adding members and broadening in scope, to become the European Economic Community, and later the European Union.

But here is the "crux of the biscuit" - the politicians of Europe, from the UK to France, Germany & Greece promised, and fully intended to provide a "safe European home" to the people of The Continent.  We are seeing the result of that today - the ever expanding social services, submission to the trade unions, and unsustainable birth rates (Germany & Italy's birth rate is below replacement level - guarantees a lower tax base) have led to the crisis we see today in Greece, Spain, France and all across Europe. Protestors don't want their subsidies cut, they want their money, so they protest the austerity measures necessary for these nations to survive.

They want their "safe European home". But there is no money. So what to do?

Years of unrestrained spending, cheap lending and failure to implement financial reforms left all European Nations badly exposed when the global economic downturn struck. This whisked away a curtain of partly fiddled statistics to reveal debt levels and deficits that exceeded limits set by the eurozone, particularly in Greece. If Europe needs to resort to rescue packages involving bodies such as the International Monetary Fund, this would further damage the euro's reputation and could lead to a substantial fall against other key currencies.

Has Europe learnt nothing from the 1920s when Germany was, in many ways, in a similar situation to Greece today? Prevented from raising exports to service its foreign debt (reparations) by mercantilist policies, Germany embarked on a disastrous course of deflation and depression which paved the way for the horrors that followed. Today as then, deficit countries cannot simply save their way out of crisis, they must have the opportunity to grow their way out. And this is also the only way to limit the damage to surplus countries, who are otherwise also destined to lose out in terms of growth, employment and financial stability. Greece, indeed all Europe, all the globe has just got to feel the pain for a while. Riots will ensue in Europe maybe even here in the US, but I think a cultural reassessment and adjustment will follow. Or not.

Remember, in fluid unstable economic times, wars often start - the promise of a "safe European home" once again rings hollow.