This was the week the European dream died its deserved death
WASHINGTON (MarketWatch) — Greece will live to fight another day.
The Greek Parliament voted with a large majority to accept the impossible bailout demands of the European Union, pending the day when sanity is restored and these conditions can be reversed or abandoned.
The vote paves the way to begin negotiations on a third bailout and to provide immediate relief to Greece with a 7 billion euro bridging loan and increased liquidity assistance from the European Central Bank.
Greek Prime Minister Alexis Tsipras, who showed a nobility rare among today’s politicians in humbling himself to ask for agreement with bailout terms that he acknowledged are pernicious and unjust, will remain prime minister, either with the fragile majority of a purged Syriza party or a national unity government.
The short-lived finance minister, Yannis Varoufakis, will return to the groves of academe, where his reckless ego will be more at home.
The ever-popular German chancellor, Angela Merkel, will win approval from her Parliament to begin talks for the third bailout of a fellow European country after she publicly humiliated Greece’s elected leader and forced him to grovel so that his elderly citizens could get medicine they need.
And Europe can begin the long process of unwinding a union that has failed and no longer has a chance of evolving into a United States of Europe.
Greece may perhaps negotiate the third bailout with the debt relief demanded by the International Monetary Fund and stay in the euro EURUSD, -0.4138% for a while.
But sooner or later, it will leave the euro, because every country in southern Europe will leave the euro. The euro as a currency for more than small handful of countries in the shadow of the German economy, will cease to exist.
The postwar “European Project” of political and economic integration is over.
Later this year, Spanish voters will register their protest against the euro with significant support for the Podemos movement, even if it falls short of giving that party a majority.