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Business

Greek Exit from Euro Would Hurt US Recovery

American markets were closed Monday for the Memorial Day holiday, but European markets remained open. The biggest question weighing on the region is whether Greece can remain in the euro zone.

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There’s no legal process for a member of the euro zone to exit the 17-nation currency union. But with Greece threatening to balk on austerity measures it agreed to in exchange for a fiscal rescue package, European officials are preparing for what was once unthinkable.

Stuart Eizenstat served as ambassador to the European Union and deputy treasury secretary under President Clinton. He says a Greek departure from the euro would drive up interest rates on Italy and Spain, economies far too large to bail out.

“So now we have a situation in which a country which is only 2% of the total GDP of the euro zone, a really tiny economy, threatens to unravel the entire euro and create a crisis with ripples that come onto our shores as well.”

A collapse of the euro would cause the region’s economies to crater, threatening the US economy’s fragile recovery. Collectively, the euro zone is Houston’s second-largest foreign trading partner after Mexico.

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Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew heads Houston Public Media's coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments across Greater Houston. Before taking up his current post, Andrew spent five years as Houston Public Media's business reporter, covering the oil...

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