The euro

It is difficult to know if the game of poker currently underway between Greece and the rest of the Eurozone (well Germany) is a game that both sides know is deadly or if one side is playing hard ball and the other the fool. The Greek state appears to operate in a kind of denial or does it believe that because Grexit means the end of the euro and the EU they can act as if they hold all the cards? It's a bit like July 1914: a deadly game was being played with the highest of stakes but many of the main players didn't realize how deadly the game was until it was too late. Signals sent were misinterpreted but then again were they meant to be? If the main players had realized in 1914 just what everyone's bottom line was war might have been avoided but the main players were not only unclear as to their bottom lines they didn't want to be clear. The same thing might be happening with Greece and the Eurozone.

Germany's stated position (according to Peter Casey in yesterday's Sunday Independent "Dig deep to find the real meaning of debt-forgiveness") is that its responsibility for two world wars requires it to maintain a commitment to the euro and the EU. Germany's actual position is that the euro and the EU are its ticket to European hegemony. (The different approaches to the Ukraine crisis between Germany and the US suggest a parting of the ways between the two on geopolitical issues.) Germany knows that Grexit means the end of the euro and that the end of the euro means the end of the EU. The end of the EU means an end to Germany's third attempt within a century to dominant the European continent. To suggest that Germany's responsibility for WW2 requires it to keep Greece (and others) in a currency that is crushing them is cynical indeed. Peter Casey puts it in a very understated way when he says that Merkel's decision to keep Greece in the Eurozone has hardly been executed with the generosity shown to Germany at the 1953 debt conference. Indeed.

It would help resolve the situation if Germany's actual position was clearly stated by commentators. One side of the equation, as it were, would be clear to all.

What of Greece? It is difficult to know whether the Greeks are playing the fool or really are fools. From my experience, I incline to the latter. They hold very strong cards for sure. If they refuse to bend the knee to Germany and are forced out of the Eurozone Germany will lose much more than Greece. Greece will suffer but they have been suffering anyway. Moreover, in the long run their suffering will ease. They will be able to revert to doing things their own way, which they are used to and which suits them. If, however, Greece believes it can secure a deal on its huge debt, remain in the Eurozone and go on permitting Greek society to treat the payment of taxes as optional they are in for a very rude awakening. (I don't believe Syriza's protestations about reform of Greek society. If they were serious about it, they would focus more on that and less, at this stage, on their Finance Minister traipsing around Europe.)

Given the stakes involved in this deadly game of poker, the Irish Government would do well to keep its own counsel, at least for the moment. The abrupt manner in which our rhetoric has changed from victim to outraged creditor would be remarkable under any circumstances (not least because we are as vulnerable as we were a few weeks ago) but to put our cards so baldly on the table at this moment is very unwise. Small states usually have the option of silence, which is usually the right option for small states.

I always refer to the Irish Times as the Iveagh House Bulletin because the IT tends to follow the Iveagh House line on the EU slavishly. Denis Staunton's article in the IT on Saturday (Europe's future hinges on the success of a Greek deal) - particularly the last sentence ("If the Taoiseach does not wish to help in finding ... a solution [to the problem posed by the different views of the sovereign Greek people on the one hand and their creditors on the other], he would be well advised to remain silent" - struck me as having been inspired by D/FA. Whoever inspired it, Staunton was right.