Periodic financial crises seem to have existed since the earliest of civilisations.
In ancient Rome the solution in critical times was in diversionary practices based on the slogan “bread and games”. These were provided to distract the populace’s attention in times of harsh financial realities.
This summer for two glorious weeks of television sporting spectacular, the dire state of the European economy was virtually ignored. And after the games many of Europe’s leading politicians went off on holiday. Well they might because despite over a score of almost monthly meetings on the financial crises, the leaders of Europe, so far, would appear to be corporately incapable of protecting the economy of most countries from further meltdown at best, or to come up with a policy other than austerity.
Austerity, the only apparent process adopted so far, may prove to be dangerous to democracy. It is one of government by an unelected troika which seems to be the chosen method of delivery of the austerity medicine to those states in need of funding from external sources. During the games a troika representing the European Union, the European Central Bank of the International Monetary Fund visited Greece to appraise the progress of the government’s approach in response to external funds provided so far. A democratically elected national government was being held accountable to the representatives of three unelected supra-national bodies.
Each country which is now faced with still increasing national debt and problems with irresponsible internal banking, did not get to such a state overnight. And in such circumstances, austerity is not a medicine which goes down easily – leaving aside any examination of its validity or otherwise. Several experienced commentators have stated that the resultant malcontent the policy has caused in these countries is feeding the growth of intolerant, mainly nationalistic, right of centre parties. Some of these parties have already impacted upon the internal political composition of regional and national governments.
There is the obvious concern in the mainly northern European states and especially in Germany, Holland and Finland, which have been more fiscally responsible than Greece, Italy, Spain and Ireland, that their government (and more importantly, their taxpayers) cannot go on underwriting future loans to states which neither can cope with their existing debts or take steps to effectively prevent those debts increasing.
Nazism and Fascism were in a large part the result of the economic instability which shaped and recruited their followers with such devastating results. This outcome of an earlier European and world economic depression was a direct contributor to the second World War.
At present Europe is in a no man’s land in respect of responsible financial foresight or any form of realistic long term hope of economic growth. No one can responsibly predict the consequence of a Eurozone member country leaving the zone voluntarily or by compulsion. If that were to happen would it have a domino effect? That this is so, is in no small way due to the fact that from the outset there was not a hard and fast definition of the purpose of the common market or for its morphing into a financial union. Furthermore, this has evolved with its own virtually unaccountable administration and its Parliament which have increasingly absorbed areas which might more responsibly be left to the member states’ sovereign parliaments and accountable to their electorates. The very future of European democracy in the member states is tied into the current financial mess.
The impact upon personal, business, church and charity finances is already severe. Some churches and charities have been forced to cut back their services in the very scenario in which the demands upon them have already increased. For the charities and the churches which have been hit by massive drop in their investments and related incomes, there are few options and no quick fixes.
Raising new funds will be difficult if not impossible. For example, the capacity of UK pensioners to be generous has been well spiked by the impact on their pension incomes of the so-called process of Quantitative Easing. QE is an excellent example of government helping one aspect of the economy and demolishing another. Northern Ireland’s youth unemployment is much higher than normal.
But beyond the spread sheets, one thing more than anything else has brought about this international economic situation: greed, which you may recall is a deadly sin.
The incoming Chief Officer of the Church of Ireland’s Representative Church Body takes up his appointment at the worst of times economically and when any form of the most professional predictions informing decisions cannot be other than subject to precarious developments in Ireland and well beyond her shores. The Chief Officer, the lay members and professionals who work with him on behalf of the Church and its mission of witness and caring, are always deserving of our prayers. At present they will need that and more. We all are upon unchartered seas.
Houston McKelvey