As Spaniards were relieved by the news, the outcome shows once again the weakness of the European Union. Spain is the fourth and largest country to request for a bailout so far but it might not be the last. What’s worse for everyone is that Spain is the fourth largest economy in the EU after Germany, France and Italy and now it is in trouble. Frankly, the EU cannot keep on bailing out countries. They must take steps to prevent the financial crisis gripping the EU from getting worse.
That means kicking Greece out of the EU.
Yes, there is a case on how unpredictable things could get if Greece is kicked out of the EU but kicking the Greek out can help solve the crisis. Like I said earlier, the EU cannot keep on bailing out countries. Not only will there be a limit in credit and political willpower, there’s also the problem that bailing countries out is just kicking the can down the road. If bailing out countries could solve the crisis, the problem would never reach Spain.
If you look at the numbers, Spain's debt to GDP ratio is at 78%. This is even more favorable than Germany's, which stands at 82%. Right now the problem is one of confidence, not finance. Kicking Greece out of the EU will be unpredictable but there is a chance things would get better if Greece is kicked out. Keeping them in will not. The problems of Greece are real, and investor confidence in the EU is shot due to the problems there. It will take years before things get solved and in the meantime, countries like Spain will be affected by Greece’s problems
Also, Greece’s contribution to the EU is a mere 2%. It is frankly stupid to risk the whole of the EU for a mere 2%. It might be painful, but getting Greece out of the EU might help solve the crisis. Right now, that’s all you can ask for. Keep them in, and other countries in the EU will just follow Spain in asking for a handout. And that is something no one needs.