As François Hollande is sworn in as the new French president, his suit will hardly have had time to dry after the Parisian rain before he is off to meet Angela Merkel in Berlin. The latter has promised to welcome the former “with open arms”, but whether those arms are open in order to embrace or to crush remains to be seen. In true European style, there will be warm words, a carefully crafted communiqué, and a circle that looks for all the world like a square. The Euro will derive some short-term comfort no doubt – at least until the machinations in Greece send it plunging again – but the ability of the two leaders and their eurocrat assistants to maintain the illusion that believing the impossible before breakfast is a mere bagatelle becomes ever more strained. The end game is approaching. No communiqué, however sophisticated its theological squirming, can maintain the fiction that Greece is both in and out of the Euro. So something, or perhaps someone, will have to give. Assuming the latest attempts to cobble together a Greek government out of the remnants of their recent elections fail, it seems virtually inevitable that Athens will be wanting both to tear up the bail-out deal, and yet still be part of the Euro. If Greece leaves the Euro, Angela Merkel will have established German supremacy in Europe: if it stays in, François Hollande will have maintained, for now at least, the concept of Europe as a balance of powers.
The irony of all this is that Merkel and Hollande are ploughing their contradictory furrows because of an identical fear: that European democracy is in peril, and that at best there will be dictatorships in some European countries, and at worst there will be war. Germans look back to the inter-war hyper inflation that they believe ushered in Nazism. A collapsing currency is their greatest fear. They insist that fiscal discipline is the only bulwark against that risk crystallising. The French believe that the greater risk is impoverishment, and that only economic growth can prevent it.
Whilst Merkel and Hollande thus bandy their fears about what poses the greater risk to democracy in the future, they appear to neglect the clear and present danger that threatens democracy at this very moment. Is the Greek ballot box to be supreme, or is the troika? Is it the will of European peoples that rules, or is it the market?
This is the fundamental question that we must confront. If we allow the globalised market to continue to make democracy irrelevant, the future will be bleak indeed. The question is not about finding some sort of compromise between fiscal discipline and growth. It is about finding a way to make the market subject to democratic control. The impossible thing we’re being asked to believe isn’t that Greece can be simultaneously in the Euro and out of it: it’s that we can simultaneously have democracy and an unbridled, globalised market. We can’t. At the moment, we seem to be prepared to sell democracy down the river in the interests of economic liberalism. That’s a truly Faustian bargain.