Nothing New under the Balkan Sun, Part II: Exchange Rates

This post was supposed to be about taxes – specifically, about the recurring role of international actors in Greek tax collection. Continuing with the previous post’s theme of “unnerving century-plus continuity in Balkan politics,” I had planned to observe that, if you squint, the current possibility of an independent tax collection commission combined with the extant influence of foreign creditors on Greek fiscal policy looks an awful lot like the International Financial Control Commission, implemented in 1898 to deal with the country’s persistent inability to pay its debts. But it turns out that while the seemingly-cyclical macro-historical character of Greece’s fiscal problems doesn’t get loads of play in coverage of the crisis, it’s hardly un-remarked upon. See here, here, here, here & most recently, here. So something more interesting was in order.

Luckily, the Lampe & Jackson tome I cited in the last post, Balkan Economic History, 1550-1950: From Imperial Borderlands to Developing Nations, is a veritable treasure trove of observations (a small book’s worth, at least) about Balkan economies at the turn of the 19th Century which are weirdly (distressingly? I suppose that depends on how teleological you like your history) applicable in the present. Concluding a chapter titled “Industrial Stirrings and the Sources of Growth”, the authors observe (on page 277) about the Balkan states (Greece included) circa 1900 that, “The restricted money supply and overvalued currency, enforced by the state’s desire to ensure access to European loans, also worked against the possibility of [industry] doing better, especially in international markets.”

That is a near-perfect description of the calamitous predicament in which Greece currently finds itself, and I really don’t know quite what to make of the fact that it seems like important things haven’t changed in more than 100 years. Two anecdotes (if you count this and the prior post) don’t really even make anecdata, let alone a trend, but if you’re willing to ignore that then perhaps both of them together can be taken as some kind of argument for a sort of (have I hedged this enough?) longue duree view of Balkan history that emphasizes the continuity of Europe’s dominant structuring role relative to its South Eastern periphery. Policy pessimists might take this as evidence that, insofar as the European Union has expanded and continues to expand away from its Western founding core, it is a fatally flawed project; I prefer to take it as evidence of the institution’s necessity instead.