From Anne Applebaum Today

Her column in today's Post (Washington, not Denver or Prague) contains one terrific line about the recent bailout agreement signed by Greece (hint -- it has something to do with a train), and one interesting argument: that this bailout represents a huge departure from the "pooled sovereignty" arrangements which European states made in order to form the European Union. For Applebaum, this new policy signifies the EU's sovereignty over national governments, and she correctly points out the fact that in contrast to IMF bailouts, the arrangement with other EU states is VERY specific (and again, her writing style is excellent). Because of this specificity, combined with the strictness of the terms, it demonstrates that the EU, particularly the northern, more fiscally sober countries are essentially writing huge portions of another nation's budget. Because control of the national budget is a fundamental aspect of national sovereignty, it stands to reason that usurping this authority represents a shift in authority to the budget-drafters.

In some ways, the wife of the Polish Foreign Minister (who no doubt has his own troubles dealing with this, though not as much as the governments of eurozone members Slovakia or Germany) is exactly correct -- EU politics is getting verrrry specific about the free spending of Greece. This isn't like IMF intervention; this is like A&E Intervention. On the other hand, a certain degree of tempering of this opinion is in order. After all, the (publicly stated) theory was that entry into the euro would be very specifically controlled, and national governments such as Greece, Spain, and Portugal (all of them relative newcomers to modern democratic politics) would "learn" how to behave fiscally. As Josef Joffe notes (using a train metaphor elsewhere in his column), that was always a bit more wishful thinking than cold-blooded rational analysis of the Mediterranean nations' books -- everybody knew that Greece (and others) were using Enron accounting, or, more accurately, Goldman Sachs accounting. In other words, it was always politics and never solely economics that drove monetary integration. To indulge myself, you can say that this was a train wreck waiting to happen.

So in a way, saying that this is a huge political step for the Union is not entirely accurate. It was always a political set-up, and though it was a more obvious step, perhaps a bigger boot in softer ground, whether it was a Rubicon-crossing is less convincing. That was done years ago, and plenty of Cassandras were willing to point that out. The EU had political "rules" about control of national budgets long before this crisis, and the fact that everybody -- from the offenders to the enforcers -- ignored them only demonstrates that politicians may not always be acting in their constituents' interests or "the general interest." Now they are working overtime to keep the system from collapsing, and at the same time consolidate their own power. Never waste a good crisis!