A question asked a lot recently, particularly on Germany.
WHY was Greece let into the Euro and the Union in the first place? And more under the breath than out loud, why were Spain and Portugal let in? Why were all these poorer and more debt ridden. low growth countries let in?
Whether you think they are shameful questions to ask or realistic ones, they have been asked.
Some people have said it’s all about Germany having countries to export to. Or cheap labour on tap. Both have some validity as do many other suggestions I’ve heard.
One thing largely overlooked in discussion so far is, I believe, a more important reason than all these – Pensions.
Now I know that right now you are saying – but that makes zero sense, these countries are precisely those with bloated public pensions. Yes, You’re right. And everyone everywhere knew these would have to go at some point. I had a long discussion with an advisor to the US state department seven years ago and he said all governments, in private at least, were clear about it even then.
This crisis has merely given them a chance to force the gutting of the pension schemes earlier.
What I am talking about is something written in a European Commission Research paper some years ago. The paper said quite clearly Northern Europe is ageing and will soon not have enough younger people to support the elderly and their pension and health needs. Therefore it is imperative the EU expand to include countries with much younger populations. It was not enough simply to have them as trading partners or as sources or immigrant labour. They needed to be brought into the Union and made a part of it.
This was done. I am not saying this was the only reason. But I am saying that the EU does have longer vision than many National Governments. Partly this was because the Commission had little else they were allowed to do. Whatever the reason, it was part of their thinking and did effect decisions. The author and the paper are still highly regarded. The author is in the Directorate that oversees banking.
The full blown force of the Pension Crisis is not yet with us but it has got a great deal closer. That, I submit, is a large part of why many in the EU do NOT want Greece or Spain or any other country with a young population to leave the Union. It is why they were welcomed in and why nations such as Estonia, Latvia and Turkey WILL be welcomed.
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