June 22, 2018
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Debt can overwhelm democracy, sovereignty

By The Tampa Tribune, Fla.

Voters in Greece, Italy and other countries deeply in debt are learning that they have unwittingly given up power to unelected bankers and bureaucrats who are now calling the shots. The welfare of individual taxpayers and workers is not the top concern of the new bosses.

It no longer matters that austerity measures are unpopular. When the prime minister of Greece called for a vote on a bailout deal that would raise taxes and surely add to an unemployment rate twice as high as in the United States, he discovered that voting was not an option. He was forced to resign, as was the prime minister of Italy.

While the European financial crisis has the unique aspect of being linked to a central currency, the euro, there is a moral lesson for U.S. taxpayers: Politicians who say that constantly adding big sums to the national debt is the best strategy to grow the economy are taking big risks with the nation’s future.

The larger the sovereign debt, the less sovereignty a country really has. Former Greek Prime Minister George Papandreou said it would be “a supreme act of democracy and of patriotism for the people to make their own decision” by voting the bailout plan up or down.

The possibility of a no vote so startled world markets that the proposed referendum was quickly dropped. So much for democracy.

If a national government can’t decide how much to tax and spend, what real power does it have? The time to think about that question is before debts get out of hand, not after. Clearly, a country has the power to borrow too much, but that decision also threatens to limit its future financial options, which is to say its sovereignty.

The Tampa (Fla.) Tribune


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