Euro 2012 filled with soccer, economic irony

The Euro 2012 Soccer Championship is finishing up the first round of matches. As I am currently teaching in Croatia, I am naturally following the home team as it negotiates its path to the finals.

Croatia is in Group C which also includes Ireland, Italy, and Spain, three-fifths of the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain). Italy and Spain are two soccer powerhouses, Spain won the last edition of the Euro Cup in 2008, and could possibly repeat.

Oh how things, have changed since that last tournament, which I also had the pleasure of witnessing from here. In June 2008, the average unemployment rate of Group C was about 9.25 percent, with Spain’s rate rising 2.3 percent in the three months ending in June 2008.

The grip of the housing bubble bursting in Ireland was beginning to accelerate unemployment there. Italy and Croatia were both experiencing reasonable, for them, unemployment rates.

Over the next four years, Spain, Ireland, and Croatia would see their unemployment rates more than double, with Spain’s currently about 24.5 percent.

Germany, in the meantime, has done remarkably well. So well, in fact OK maybe not that well, but the European bar for success has become increasingly low they are unwilling to loosen the purse strings for fear of raising inflation. So rather than lose themselves to fiscal imprudence they are willing to let other economies fail. Germany is through to the next round.

As is their next competitor – Greece, the “G” in PIIGS. The symbolic implications of this match are too numerous to count. The fiscally responsible Teutonic powerhouse versus the profligate and enfeebled unemployment is roughly 23 percent Balkan economy. This is “a no miss” game. Imagine the headlines.

And what of Portugal, the “P”? The Portuguese made it through to the next round, and they play non-eurozone member the Czech Republic. Their unemployment rates: 15.5 percent in Portugal and less than half of that for the Czechs.

So the PI-GS (drop Ireland) have made it through. Meanwhile the well-to-do northern countries Denmark and the Netherlands are out. As are the transition economies of Poland and Russia. Ukraine and Sweden play in separate games Tuesday, but neither are likely to advance.

So Germany faces, with the exception of the Czechs, teams from countries where economic resentments are high. And Greece might even be thawing with the recent election of the center-right, pro-European New Democracy party, perhaps paving the way for more bailout money from its rival on the field Friday, Germany.

So the Croatian team heads home, and the certainty of the soccer pitch is replaced by the uncertainty of the European crisis, a dark cloud looming over the global economy.

And yet through all these dire economic warnings and predictions, Europeans turn their attention to TVs to watch their respective teams. For a few hours, bank failures, bailouts, unemployment rates, and political hubris are put aside to cheer or bemoan their fates on the pitch.

sonora_t@fortlewis.edu Robert “Tino” Sonora is an associate professor of economics at Fort Lewis College and the director of the Office of Business and Economic Research.