On Thursday, Lithuania became the 19th country to join the euro zone. The move made it the last Baltic nation to adopt the currency, and the timing was inauspicious—the euro looks more and more like an economic death sentence as depressions spread across the continent.
Proving skeptics right, less than 24 hours later, the currency's value dropped to a four-year low after European Central Bank President Mario Draghi seemed to suggest that the bank might start printing money to combat what he called "excessively low" inflation. The Financial Times noted that with the latest dip, the euro's value "has fallen by 12 percent against the dollar in the past six months."
And just as Lithuania has joined the club, Greece appears to be considering getting out as it heads toward elections with the hard-left Syriza party, currently leading in the polls, threatening to leave the euro zone if it wins.
So what's driving Lithuania to join a flailing, unsteady economic partnership? A political link to the West seems to be one answer, and the threat of Russia would be another. As Matt O'Brien noted at Wonkblog, "it's no coincidence that Lithuania's support for joining the euro has gone from 41 percent in 2013 to 63 percent today in the wake of Russia's incursion into Ukraine."
Driving home the point, at a ceremony on Thursday, Lithuanian Prime Minister Algirdas Butkevicius offered that the euro would “become a guarantor of both economic and political security.”
In a telling response, the Kremlin-funded news outlet Russia Today chronicled Lithuania's transition to the euro in a story with the headline, "Lithuania joins euro zone despite 40 percent of population being against." Let's just say there were plenty of nods to the euro's struggles.
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