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If Germany and Greece were a married couple, they would be headed for divorce. Like many faltering relationships, it comes down to money. Germany, Europe’s largest economy, has plenty of it and Greece, facing a potential default, needs it badly.
The relationship is complicated. Back in the 19th Century, Germans became enamored of all things Greek. King Ludwig I transformed Munich into his idealized vision of Ancient Athens. Heinrich Schliemann, a wealthy German businessman and archaeologist, began excavations at the ancient city of Troy, Schliemann liked Greece so much that he advertised for a wife there in a newspaper and eventually married a Greek woman 30 years his junior. The archaeologist wanted desperately to prove the historical validity of ancient texts such as the Iliad. His work was later proven wrong but laid the groundwork for a close relationship between the two countries. Vast collections of ancient Greek artifacts reside in German museums including Berlin’s Museum of Greek and Roman Antiquities. There are also a slew of cultural institutions linking the two nations. Earlier this year, Sophocles’ Electra was presented by director Costas Papacostopoulos in Cologne.
By the 20th century, Germans turned their attention to another ancient culture, Rome. Hitler invaded Greece in 1941 to bailout his allies, the Italians who had botched. Understandably, World War II remains a touchy subject today. After the War, West Germany was rebuilt and became an economic powerhouse. Greece, however, was beset by political chaos and was ruled by a military junta from 1967 to 1974. Many Greeks fled their country, creating a diaspora that stretches around the world, including Germany.
The hatred between the two countries seems like it may boil over at any point. Last month, a group of masked hoodlums ransacked the offices of the Greek Tourism Offices in Berlin. Greeks are also portrayed as “lazy” in the German media, and throughout the rest of Europe as well. Greeks counter that they are being unfairly maligned and at least one economist has offered what he says is proof that refutes this stereotype.
German banks are on the hook for tens of billions of euro in Greek sovereign debt that would become basically worthless in the event of a default. German Chancellor Angela Merkel knows that this would damage the German economy and may lead to the downfall of the European Union. Many Germans would say that German should solve its own problems and not keep pouring money into a black hole in Greece.
Germany and Greece are like an unhappily married couple that is staying together for the sake of the kids, which in this case means the other countries in an increasingly interdependent global economy. 24/7 Wall St. decided to examine if these nations can “work it out” and is not terribly optimistic. Below are the reasons why. They are in no particular order.
Jealousy: Greece can lay claim to the title of “the Birthplace of Western Civilization” which Germany almost wrecked single-handedly in two World Wars. Over the last few years, Greece has been pressing museums around the world to return its prized ancient relics that it believes were stolen. German museums are no exception. The pilfering continued in modern times. In 2007, Germany returned a collection of neolithic artifacts stolen from a private collection in Greece in 1985. A year later, some of the loot was uncovered by police in Munich who somehow forgot they had the items. As tensions between the two nations heat up, expect more cases like this to emerge.
History: Adolf Hitler would sour any relationship. The Nazi leader’s forces invaded Greece in 1941. When they reached the Acropolis, some Germans ordered a Greek soldier to take down his country’s flag and replace it with the swastika. He refused and leapt to his death from the ancient building. The story galvanized Greek resistance to the Nazis though there is no proof that the soldier even existed. Last year, Greek politicians said that they were owed reparations from World War II. Germans rejected these claims, arguing that they paid Greece all the money it was owed. The fight is not over, however.
As the Guardian newspaper noted in ‘Greek prime minister, George Papandreou, pledged his government would support the compensation claims of survivors and relatives of the massacre in the village of Distomo in June 1944, which left 218 people dead.”
Economy: No country is an island in the world economy. Germany and Greece are no exceptions. German banks own billions of euros which would become worthless if Greece defaults. The situation is so bad that Fitch Ratings sees “high potential “contagion risks for German banks if there were any restructuring of Greek sovereign debt.” German bank ratings are not at risk, at least for now.
Immigration: Many Greeks, frustrated by their country’s stagnant economy, have moved to Germany to find better jobs. Native-born Germans, like others feel under increasing assault by cheap, immigrant labor. Last year, Merkel made the stunning statement that “multiculturalism has failed.” That must have come a surprise to the nearly 300,000 Greek citizens who call Germany home, including several professional soccer players. Some Germans of Greek ancestry hold public office. Historians say Greeks first came to Germany during the tine of the Holy Roman Empire.
Tourism: Tourism is a big deal for Greece because it’s one of its few vibrant industries. Economic crisis or prosperity, Germans are a familiar sight on Greece’s sun-drenched beaches. That must annoy some Greeks, particularly as they continue to flounder financially. Last year, the German government launched an advertising campaign to promote Greek tourism. Greece, however, was forced to shutter several tourist offices in Germany for budgetary reasons.
Source: –Jonathan Berr http://247wallst.com/