Can Ancient Chinese Yin Yang Philosophy Help Save the Euro?

English: Yin yang picture Español: Yin yang

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As the Euro crisis has unfolded, I have continued to be optimistic that the politicians will be able to broker a solution. I have debated the subject at length, often with colleagues who had passionate views but I am still reminded that every argument has a counter argument. According to political commentators consensus and unity are seemingly out of favour. Polarities abound: between North Europe and South Europe, Europeans and Americans, keynesians and monetarists,  bulls and bears etc.

It is easy if you are a retired Greek Civil Servant, facing a cut in pension and the threat of hyper inflation to want to blame somebody else. In debates in the German parliament, it is also appealing to sympathize with the prevailing Germanic outlook, rather than the Latin European view. On the other hand, surely the youth of Southern Europe have some rights too? It is not unreasonable for South European youth to want the same basics as their parents, including food, shelter, jobs? Critics challenge the Greeks and their South European neighbours to work harder and fend for themselves. Unfortunately, jobs are not available for much of the youth of Southern Europe  and matters are only a little better in Northern European countries (youth unemployment in Spain has reached 46%). Countries within the Eurozone have forfeited management of exchange rates, central bank interest rates, plus a degree of national political independence – in return, the European Union demanded greater European centralization and related bureaucratization, plus the promise of a sunnier economic outlook for all. The prevailing political classes in France and Germany cobbled together the wider European Union, without taking convergence sufficiently seriously. Leading Nobel Prize winning economists, like Joe Stiglitz and Paul Krugman argue that Greece was destined to fail economically within the Euro, as much because of inherent weaknesses in the Euro, as Greece’s own macro-economic management.

I cannot believe, after all the painful European lessons of the Twentieth Century that there is not a better way. As policy makers struggle to get ahead of financial markets, there are some interesting lessons to be learned from Yin Yang and ancient Chinese philosophy, often called “Yin and Yang” in the West.

The concept of Yin Yang is used to describe how:

Polar opposites or seemingly contrary forces are interconnected and interdependent in the natural world, and how they give rise to each other in turn. Opposites thus only exist in relation to each other. Yin yang are not opposing forces (dualities), but complementary opposites that interact within a greater whole, as part of a dynamic system. Everything has both yin and yang aspects as light cannot exist without darkness and vice-versa, but either of these aspects may manifest more strongly in particular objects, and may ebb or flow over time.

The challenge for European policy-makers and the troika is to get the Yin Yang of the Euro back in harmony. The alternative is for individual countries or groups of countries to break away, risking draconian cuts in living standards, social crisis and political conflict.