The Big Event

How It All Came To Fruition 

Lednichenko, Olga. "European Union Flags". 11/28/2011 via flickr

The Greek financial crisis can be traced back in history to 2001 when Greece switched from the Drachma to the European Euro. The European Union is a politico-economic union of 28 member states founded on January 1^st 1958 in the Cold War Era. In 1991, the union united under one single currency to end trade issues and economic strains. This currency is the Euro. The EU contains every large country in Europe and many smaller European countries united together under one large European government that overlooks the governments of each country. Unlike many of the large European countries, Greece is small, poor, and geographically isolated from the rest of European in the Mediterranean. The euro was seen as the future of Europe. The euro however, was not a perfect system due to the fact that every country in Europe has different economies. The euro ties together all the countries within the European Union, which in turn pulls other countries down with it when the Euro fails. When brought under the Euro, Greece began borrowing money from large European economies with strong economies while Greece continued to have a weak economy with no future plan as how to payback these large banks in Germany and France. With high unemployment, massive amounts of people in poverty, and a large deficit, Greece was not financially prepared to adopt the Euro as their currency. In order to be accepted for the Euro program, Greece lied about their deficit and their current economic situation to the European union.  Before the European Union, Greece’s economy already had poor monetary policies and was plagued with corruption, leading to a strong economy across the country. Unable to sustain the Euro, Greece spiraled into an economic slump on the same scale as the American Great Depression.