There are loads of good arguments out there for why Greece (or Italy, or Spain, or Portugal) should leave the Euro. We’ve always been partial to the basic philosophical truth that monetary policy lies at the core of national sovereignty. No nation is sovereign if they can’t set monetary policy.
And then we saw this chart (from the IMF, no less) that illustrates the actual costs of lack of sovereignty. This is what happens when said philosophy meets the balance sheet:
Ouch, IMF. When you put it like that, it’s hard to see the Euro as anything but a raw deal for the Club Med nations. Their real GDP growth was on average, double during the period from 1980-1998. Needless to say, being able to direct monetary policy to reflect one’s own best interests tends to work to one’s own best interests.
Which raises an interesting question: What if, during the past 15 years, Greece, Italy, Spain and Portugal had been able to grow their export industries by maintaining export-friendly currency values?
But that’s crazy talk. The Euro is in everyone’s best interest, of course. It’s just a coincidence that it hasn’t worked out for the poorer half of Europe.