Despite Friday’s dramatic announcement, in which Greece’s new Syriza government essentially pled for a European bail-out extension it had previously sworn it would not accept, the euro crisis is a long way from over. Tomorrow, the Eurogroup is set to review Greece’s promised reform proposals. And if that goes well (no sure thing), then, as The Wall Street Journal reports,
Even if Greece gets its bailout extension this week, its problems are hardly over. Athens can’t draw on any loans until overhauls are delivered, which isn’t envisaged before April’s end—and then only if Mr. Tsipras can win Parliament’s backing for whatever he agrees upon with the troika. That can’t be taken for granted since a section of his party is well to the left even of him and Finance Minister Yanis Varoufakis.Indeed, Mr. Tsipras and his party spent the past three years vigorously opposing most of the reforms under the current program, which he has had to promise not to reverse. Meanwhile, Athens could run out of money as soon as next month.
Europe’s problems are both more urgent and profound than most people yet recognize. As Gideon Rachman notes in a spot-on, incisive column in The Financial Times today, “Watching the Greek crisis unfold, I found myself torn between two equal and opposite thoughts. First, the euro cannot survive. Second, everything must be done to save the euro.”Europe is currently torn between a double crisis: it has an unsustainable currency, but no clear path out of it. The options that have been mooted are messy, ugly, and have a high risk of causing systemic financial and/or political problems, either in Greece or Europe writ large. Able, perhaps even visionary, leadership is going to be required to get out of the bind—and yet very little leadership of any sort has been in evidence lately.The post-World War II European order, as reformed and extended after the Cold War, is the greatest success of international politics since the Enlightenment. It is now at risk. And its custodians are only slowly, slowly beginning to stir from their complacent slumbers.