EUROPEAN DIARY:With no script to provide guidance, EU officials are in improvisation mode, writes ARTHUR BEESLEY
MISSILES FLEW overhead at a noisy protest march in Athens as Lucas, a courier in his mid-30s, explained his predicament.
“I don’t have enough money,” he said. “There is no future with €700 per month.”
The father of a young child, Lucas had stopped work during a national strike to express anger at the government. As riot police stormed down the street after a band of hooded hardliners, he took issue with the militants.
“They have weapons and they are organised,” he said. “They are not right.”
As the EU authorities edge towards a controversial bailout for the government of prime minister George Papandreou, many ordinary Greeks are struggling to make ends meet.
Amid concern that any rescue would come laden with exceptionally tough terms, there is deep ambivalence about the country’s would-be saviours.
Even though some Greeks say grudgingly that external pressure from Europe to sort out their public finances is ultimately a good thing, many declare defiantly that the country has been left out to dry.
“They don’t respect us, they don’t respect our history, they don’t respect anything,” said another protester, a bank official in his 50s who identified himself only as George. “We want to have something in the salary. They are trying to take everything from us, so we can’t stand it any more. We can’t afford it anymore.”
This is the backdrop to a fast- moving debate in Europe’s capitals on the parameters and mode of any intervention to prop up Papandreou’s administration. Don’t expect a tickertape parade in Athens if a deal is done.
For Greece and the European authorities, this is unmapped ground in which the compass provides only the vaguest guidance.
In Brussels, key meetings continue for hours without end as officials run the rule over unpalatable bailout scenarios that would have seemed unthinkable only a short time ago.
The fact is that no one really knows how the situation will work itself out. EU officials with powerful masters say so, diplomats say so, sources in national governments say so too.
Every day brings a new tide of rumour and conjecture. Routine engagements assume an aura of great importance. Direct questions are met with cautious ambiguity. An administrative system addicted to process and procedure is in improvisation mode.
Are they really making it up as they go along? To a great extent they are.
That this takes place only months after the enactment of the Lisbon Treaty is all the more extraordinary. The pact was framed as Europe’s grand settlement, the definitive reworking of the union’s architecture for the new century. It’s already looking more than a little light-winged.
In long years of tedious institutional debate, it was never seriously suggested that Europe would abandon the “no-bailout clause” enshrined in EU law since the very beginnings of the single currency project. Now it’s the main event.
Although European Commission president José Manuel Barroso says a way can be found to rescue Greece without breaching the bailout ban, this is but a technical point. In terms of the philosophical and political moorings of monetary union, the clause seems set to be consigned to history. Already breached in spirit, work to dismantle the legal edifice is well under way.
What is more, the Germans are on board. The guardians of fiscal probity and austerity – at whose behest the bailout ban was included in the Maastricht Treaty 18 years ago – have more or less conceded that the game is up.
German chancellor Angela Merkel said as much last week when she said treaty changes would be needed to proceed with a European Monetary Fund (EMF), a euro version of the IMF.
The German plan has run into opposition elsewhere in Europe, notably from a lukewarm France.
What is significant, however, is that the debate has already reached this point. For months, remember, bailout talk in the top echelons of the EU was taboo.
The very notion of an EMF would have been dismissed as fancy in the recent past, as speculation without due regard for the bulwark that was the Stability and Growth Pact.
Yet the pact, which is the euro rulebook, has been found wanting, and seriously so. This is but one of the elementary lessons of the current episode.
That the public finances in 13 of the 16 euro-zone countries are in breach of the pact’s rules underlines fears that Greece’s slide into fiscal quicksand has the potential to contaminate other members of the currency.
In Athens, the mood is bitter and emotions are raw. People say the outlook is bleak. Pay cuts and tax increases hit hard when the average monthly civil service salary is some €1,300.
The EU is waiting to intervene “if needed”, but hearts and minds are not with Europe on this one. Far from it. The ordeal goes on.