In 2015, as Greek pensioners lined up outside shuttered banks and German tabloids mocked the nation’s supposed profligacy, Europe congratulated itself for enforcing fiscal discipline on the continent’s most unruly member. A decade later, the images are gone, the headlines have faded, and Greece is now hailed as a “recovery story.” But what if the story we told ourselves was wrong?
Far from being a moral fable about Southern irresponsibility and Northern prudence, the Greek debt crisis was a stress test of the eurozone’s political economy. Today, as the EU faces new challenges—rising sovereign debt post-COVID, economic fragmentation, populism—the structural flaws revealed in the Greek debacle are more relevant than ever.
Greece wasn’t the exception. It was the warning.
What triggered the crisis was no mystery. After the 2009 global financial collapse, markets discovered what EU officials had long ignored: Greece had entered the eurozone with creative accounting and fragile fundamentals. Debt had soared, competitiveness had collapsed, and fiscal rules were ignored. But this was no uniquely Greek pathology — it was a predictable consequence of a euro designed without a central treasury or coordinated fiscal policy.
Between 2009 and 2015, Greece lost over a quarter of its GDP — a contraction worse than the Great Depression in the United States. Unemployment peaked at 27%, youth unemployment at over 50%. Hospitals closed. Suicide rates spiked. A generation of educated Greeks emigrated. The word “austerity” became synonymous with economic amputation.
If this sounds like an old story, it shouldn’t. The EU’s approach to the crisis revealed fundamental flaws that remain unresolved. Fiscal rules were applied rigidly during a depression, and then casually suspended during COVID-19. Monetary union still lacks a central fiscal authority. There is still no genuine transfer mechanism between stronger and weaker economies — only conditional lending. In the United States, Mississippi doesn’t receive loans from Washington when a hurricane hits. It receives aid. Europe remains incapable of such solidarity.
And now, the Greek “exception” is becoming more common. Italy’s public debt has surpassed 140% of GDP. France’s fiscal deficit has breached EU limits. Germany — once the stern disciplinarian — is now contorting its own rules to maintain spending. Post-COVID borrowing, rising defence costs, and energy instability have brought many EU members to precisely the same position Greece occupied a decade ago.
Yet the illusion persists. That Greece has “recovered” — its bonds now investment-grade, its budget in primary surplus — is taken as proof that austerity worked. But the truth is more complex. What brought Greece back from the brink was not just Troika’s discipline but a global decade of zero interest rates, quantitative easing, and a pause in market pressure. The recovery was more the result of external liquidity than internal reform. Now, with interest rates rising and geopolitical fragmentation accelerating, the cushion is gone.
Historically, empires and unions fail not when crises hit, but when they fail to learn from them. The Roman Empire survived plagues, invasions, and inflation — until it could no longer reform its institutions. The interwar gold standard collapsed not simply because of economic mismanagement, but because it imposed austerity without adjustment mechanisms, punishing debtor nations while protecting creditors. Sounds familiar?
Greece did not break the euro. The euro broke Greece. And in doing so, it exposed the fragile foundations of a union that wants to be a currency without being a country. As the ECB confronts fresh inflation pressures, and fiscal hawks return to Brussels, the ghosts of 2010 are stirring. If Europe’s leaders still believe Greece was an aberration, rather than a harbinger, they are gambling not just with economies—but with the political future of the continent itself.
Ten years ago, Athens burned while Brussels preached. Today, Rome and Paris wobble. We ignored the warning once. Europe may not survive ignoring it again.
*Grigoris Patsakis is a project manager at ELIAMEP’s Turkey program
This opinion piece has been selected as part of To Vima International Edition’s NextGen Corner, an opinion platform spotlighting original voices from the emerging generation on the issues shaping our time.
