Crashed: How a Decade of Financial Crises Changed the World

by Adam Tooze

At this fateful moment Tusk intervened. The two parties could abandon the talks, but if they did, he would not hesitate to tell the world that they had allowed “Europe to fail” over what was in the final analysis a trivial amount of money. It wasn’t the prospect of economic disaster that brought Merkel to her senses, but the likely political fallout from letting Greece go. When it came to the moment of decision she did not feel bound by financial logic. She did not want to be the chancellor who “broke Europe.” That was more important than finally resolving the question of Greek debt. She split the difference. Germany would agree to yet another bailout. Greece would receive new loans from Europe totaling 86 billion euros. In exchange, Athens accepted severe intrusions on its sovereignty. It was required to whip through yet more cuts within forty-eight hours. Parliamentary sovereignty was reduced to a rubber stamp.