The slow-motion destruction of the Greek economy, as if foretold in a Delphic oracle, looks like a scene from a Greek tragedy, with the chorus warning repeatedly: “O Wise Kings and Queens, you can’t have a currency without commitment, a currency only for convenience, a currency without an army." For the euro, a bold experiment in creating a monetary union without a political union is a unit for transaction; nobody feels passionate about it.

The Greek collapse bears this out. Are the tax-avoiding, beach-loving Greeks responsible for their plight? Is it their politicians? Are European bureaucrats in Brussels responsible? Is it the European Central Bank? Or is it all German Chancellor Angela Merkel’s fault?

When investors lose confidence in an economy, its currency collapses. Its central bank can raise interest rates or cut money supply to tame inflation. When investors trust an economy, the currency appreciates as people abroad buy assets denominated in that currency and importers rejoice. Like other nations, Greece surrendered that flexibility when it traded the drachma for the euro.

And that was the problem: Being an elite-driven project, Europe’s politicians never really asked their people, collectively, how much power they’d like to cede to Brussels. The few times they did, the voters usually rejected them and so they changed the rules and went to the voters one more time, the second time, often getting grumbling approval.

That democratic deficit is what rankles most Europeans and it is perhaps appropriate that Greece, which often gets credited for giving the gift of democracy to the world, is shouting the loudest. The well-heeled, well-travelled and sophisticated multilingual elite wants a closer union. They cross the borders often and don’t like waiting in immigration queues; they like cheaper roaming charges for their cellphones because they are roaming the continent all the time; they want high-speed trains and road links subsidized by taxpayers to transport them from one capital to another; they glide by the countryside, where voters view the continent’s unification very differently. This is the elite that skis in the Alps, spends summers in St Tropez, is familiar with the wines of the Po Valley, the cuts of German meat, and the 246 varieties of cheese which infuriated Charles de Gaulle so much that he thought it made his France ungovernable. Dig deeper and a different Europe emerges where people have old memories, remembering conflicts long consigned to the past. (A Dutch cab driver, when asked how come his English was so good, told my son once: “Because we dislike the Germans more." Thomas Mann understood that; he once wrote: “We do not want a German Europe, but a European Germany.")

For countries rally round their flags and fight wars. Their resounding anthems rouse their peoples’ spirits. Their passports provide their citizens with a sense of belonging in an increasingly globalized world. And the money their mints print asserts their identity and power in the global economy. By giving up their currencies, the countries wanted to acknowledge that their interests were intertwined and enmeshed, making it easier for accountants, but they also gave up the right to spend and save the way they want.

But despite unification, atavistic longings survive. Belgium and Spain struggle with separatist tendencies; to Britain’s cup of Irish woes add Scotland, whose politicians appear to think being part of Europe is better than being part of the UK. European utopianists have viewed the new European identity as one based on Kantian “pacific federation". So long as that dream is elite-led and lacks people’s consent, euro sceptics will point out the underlying Hegelian disdain for the masses.

The concern over German exceptionalism, or Sonderweg, is real, given the history—think of the Greek cartoons showing Merkel as a Nazi officer. But then reflect on the post-war fact, that the Bundesbank and the Deutsche Mark were two spectacular successes of that period. Writing about Indonesia, Benedict Anderson termed nations “imagined communities". At times like these, the European Union often looks like one.

Salil Tripathi is a writer based in London. Your comments are welcome at salil@livemint.com

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