Because Greece is part of the European Union, its debt crisis may seem like it is only Europe’s problem.
That is not the case.
How the crisis in Greece pans out may in fact shape how the U.S. economy and geopolitics plays out in the next 10 or 20 years. If the United States does not step in to aid Greece, the United States will lose a large percentage of its trade profits from Europe. In addition, a lack of aid from Washington may assist the Sino-Russian alliance in influencing poorer European and Asian countries.
In 2004, U.S. trade exports to Greece reached $52.6 billion. With the economic decline in Greece, the country will be unable to continue to trade with the United States to the same degree. But this is not the only trade that the United States will lose as a result of the debt crisis in Greece.
The dollar is rising against the euro, which is partially a result of the crisis in Greece. While the word “rise” may imply that this is a positive sign, it is in actuality bad news for the U.S. economy. A dollar that is worth too much more against the euro will make U.S. goods more expensive for countries in the European Union. If the goods are too expensive, then many states will either purchase the goods in much lower quantities or will not be able to buy them at all.
Basically, if someone does not help Greece, the United States will lose a lot of money.
The other problem is Sino-Russian in nature. China has been spreading its sphere of influence. One of the ways in which China’s influence is growing is through the use of economic aid, and one of their most significant economic and political allies is Russia. Greece has been becoming increasingly friendly with Russia as a result of its economic difficulties.
According to an article by Yibada, “China has expressed interest in transforming Greece as a European base” for the “Belt and Road” initiative. This could lead China to aid the country.
China is offering Russia, Greece and other countries an alternative to Western aid institutions. As is well known, with money comes influence. If the United States wants to keep its influence over the world and continue to spread democracy, then it needs to continue to aid countries and perhaps even increase this aid.
Politically, China is undermining the sanctions against Russia and could continue to undermine U.S. foreign policy in the future.
If the United States does decide to be a major player in aiding Greece though, our economy will benefit majorly.
Stabilizing Greece will aid in stabilizing the euro, which in turn will at least assist the United States in maintaining its current trade with countries in the European Union. But, in addition, improvement in Greece’s economy will make it possible for Greece to become a more important trading partner for the United States.
It is up to the United States: this matter of aid could either help the United States, or it could damage its economy.
– Clare Holtzman
Sources: The Borgen Project, Council on Foreign Relations, Harvard International Review, Mother Jones, U.S. Department of State, Yibada