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Greece
14 November 2011

Gideon Rachman: Look behind you, Lucas and Mario


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In his FT column, Rachman writes that Europe, and the world at large, has every reason to hope that Messrs Monti and Papademos can work miracles. For if the technocrats fail to do so, the extremists are waiting in the wings.


The radicalisation of politics is just as visible in the creditor nations of Europe as amongst the debtors. Marine Le Pen of the far right National Front will have a big impact on the 2012 presidential election in France, although she is unlikely to win. In the Netherlands the government is now reliant on the votes of the Freedom party led by Geert Wilders, which is running second in the polls. Austria’s far right Freedom party is at level pegging in the polls with the governing People’s party. In Finland the nationalist True Finns are still gaining ground and are easily over 20 per cent in the polls.

All of these rising parties rail against “elites”, whether in Brussels, Wall Street or their own governments. All the populist parties are deeply sceptical of the EU, which they see as promoting most of the things they abhor: multiculturalism, international capitalism, the erosion of national borders and the erasure of national currencies.

Mainstream politicians in creditor nations such as Finland, the Netherlands and Slovakia say that, after the Greek bail-out, they could not possibly vote for a further package of loans for Italy – the voters would revolt and turn to the political extremes.

Imagine, however, what the European political landscape would look like if banks started to collapse, people lost their savings and their jobs, and there was another deep recession. At that point voters would be desperate and disillusioned enough to turn to the extremist parties in much larger numbers.

So a great deal is riding on the ability of the technocrats to stabilise their national economies, calm the bond markets and prevent another financial crisis and a disorderly break-up of the euro. The trouble is that, while Messrs Monti, Papademos and Draghi are very able men, they are not miracle-workers. The danger is that the situation in Europe may now be too far gone for even the most steely and brilliant of technocrats to turn things around.

Full article (FT subscription required)



© Financial Times


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