Sep. 7, 2011
Eurozone faces extreme economic challenges, Emory political scientist explains why
The economic crisis in Europe's Eurozone, the grouping of more than 20 countries in Europe that use the euro as their means of currency, is worsening, and Emory University political science professor and Europe expert Thomas D. Lancaster says the brunt of the financial burden falls on one country, Germany. The main question now is how much longer are they willing to pay.
"They wouldn't overtly refuse to pay immediately because that would bring the Eurozone down," Lancaster explains. "What is clear within the context of the Eurozone and the European Union, fiscal policy has to be addressed. And, it's very, very clear that the vast majority of people in Germany… are clearly getting tired of this."
While Germany has already helped bail out Greece, Ireland and Portugal, the problem appears to be widening. Italy, Spain and France may be next in line. While German citizens question why their country is holding up their Eurozone partners, Lancaster says it's because Germany needs the Eurozone to continue to thrive.
"The German economy is export driven," he says. "Without the possibilities of those exports in terms of within the European Union and it's trade-free zone, essentially, and within the context of global trade, Germany would not be able to continue the economic strength that it's had."
Countries Could Leave Eurozone
It's possible that the Eurozone may be able to push forward in a smaller version of its former self. Lancaster says Europe's major economies, Germany, France, Spain and Italy, must stay connected, but the smaller fringe countries may be forced out. However, if a country like Greece leaves, Eurozone leaders have to make sure it doesn't cause a ripple effect.
"If Greece leaves the Eurozone, it may be an indication of how could or could not begin some sort of limiting the size of the Eurozone or scaling back the size of the Eurozone," Lancaster says. "It's like war or anything else, it's a lot easier to get into than it is to get out of."