Europe on Monday appeared to save the euro zone from shattering by agreeing to a last-minute rescue of Greece. But on a continent where economic strife has exposed long-buried grievances, there are rising fears that the price tag of the bailout is European unity itself.
Euro-zone leaders unanimously signed off on the deal, which — if accepted by the Greek Parliament — would plunge Greece back into deep austerity just days after voters there pleaded that they could not take any more. But a fissure was rapidly opening across Europe between those who demanded even more punishment for Greece over its broken promises and those who said the bailout terms were as harsh as those after a wartime defeat.
Now Europe must attempt to rebuild unity after the most divisive weeks in recent memory. This splintering of trust comes amid other crises and developments that have shaken a post-Cold War stability taken for granted just a few years ago: the rise of far-right nationalist political movements, the war in Ukraine, the growing threat of Islamist terrorism, and record-high flows of refugees to European shores.
Europe’s two camps are led by the core nations of France and Germany, World War II enemies that came together to build a soaring project of European unity but have increasingly found themselves on opposite sides of the Greece crisis. Many in France said Germany had shaken off its postwar reluctance to flex its muscles, forcing its neighbors to bend to its will. German leaders, meanwhile, said that without their hard bargaining, the euro zone would have unraveled further.
“Greece has repeatedly made clear that it wishes to remain inside the euro zone,” German Chancellor Angela Merkel said Monday, bleary-eyed after more than 15 hours of negotiations that officials said nearly broke up without yielding a deal. “There have been tough negotiations with quite tough conditions.”
“There has always been tension” in European negotiations, French President François Hollande said Monday, trying to bat away the idea of a deeper rift. “There were different views, but never in the form of fractures.”
Despite Hollande’s attempts to minimize European divisions, however, the two emerging sides were obvious Monday. The anger swiftly shot across the continent, with Twitter users sending the hashtag #ThisIsACoup into trending territory amid fury over what Greek leaders had been forced to concede.
Many in the camp that espoused a softer line tried to reassure their voters that European unity remained a desirable ideal, not a dangerous autonomous force that pushed privation on its subjects.
“Europe is our creation, not our stepmother,” Italian Prime Minister Matteo Renzi said.
But the high-stakes talks in recent weeks laid bare fundamental conflicts that may be difficult to put aside in the future. Because the deal reached Monday did not finalize Greece’s bailout, those problems could quickly reemerge as the negotiations continue. There is a long track record of failed rescues for Greece — this will be the Mediterranean nation’s third bailout in five years.
Germany floated a plan amid the negotiations that would have forced Greece out of the euro zone, the first time such a prospect had been put in writing at such a high level. It drew swift support from allies that insist on tough rules on the grounds that Greece can no longer be trusted to implement any new bailout bargain.
“There are a lot of things out in the open now that can’t be put back in,” said Raoul Ruparel, co-director of Open Europe, a London-based European policy research center. “There is a huge amount of tension inside the single currency, most of all between France and Germany.”
“Whenever there’s another crisis in the euro zone, this will flare again,” he said.
That assessment was shared by many in Europe’s tougher-
minded nations, some of whom said they were sorry they had lost an opportunity to make clear that money once borrowed must be repaid.
“We need to teach the Greeks a lesson,” one senior euro-zone diplomat said Monday, speaking on the condition of anonymity to discuss internal deliberations. The diplomat said the Greeks should blame their politicians, not the European Union, for the years of joblessness and mounting debts that have blasted away a generation’s worth of economic growth.
But in other corners of Europe, there was shock that Germany pushed so hard against Greece after years of reluctance to be seen as Europe’s predominant power for fear of reawakening World War II-era demons. Merkel has long done a two-step shuffle with France, hammering out compromises that lay somewhere between German demands for strict adherence to rules and French willingness to go easy on struggling neighbors.
“There is the feeling that the Germans overplayed their game,” said Elie Cohen, an economist who is research director at France’s National Center for Scientific Research and has advised Hollande. “The idea that Germany is the reluctant hegemon in the future won’t be that popular,” he said.
The one positive outcome of the weeks of bargaining, some analysts said, was that a deal was reached at all. For years, European leaders have made last-
minute agreements just before their whole project of unity imploded. That model appeared to remain intact as the dust settled Monday.
No matter how painful the demands might be for Greece, the fact that its leaders accepted Europe’s requirements showed that they believed getting kicked out of the euro zone would have been worse.
“Even when the crises are self-created, the E.U. tends to find a way out of them without the wheels coming off,” said Mark Leonard, director of the European Council on Foreign Relations.
Birnbaum reported from Riga, Latvia. Karla Adam in London and Chico Harlan in Washington contributed to this report.