NEW YORK (TheStreet) -- There is basically one purpose for the existence of the European currency union and that is to create an economic region that can be competitive economically and politically in the greater world.
In order to be successful in its current negotiations, the Greek government must distract us from this fact. Consequently, the Greek prime minister, Alexis Tsipras, and his government, cite the fact that the Greek people elected his party to end the austerity that has been forced on the country and to moderate the reforms needed to bring the nation up to the standards of other members of the community.
Tsipras argues that he cannot violate this trust in trying to resolve the differences that exist between him and the members of the Eurozone. His cry is the cry of national sovereignty.
Yet, the leadership of the European Union appears to be sticking to its vision. These leaders seem to realize that the only way that Europe can be competitive in world markets and be able to bargain politically with world powers is to create an economic community that is as efficient and productive as its main competitors, the United States and China.
Since the Second World War the United States, more or less, has ruled the world as its major economic, political, and military power. China is on the rise and wants to be competitive with the United States and its leaders are relentless in pursuing this goal.
If Europe wants to play at this level -- economically and politically -- then it is going to have to create an economic juggernaut to face these powers on an equal basis.
Europe cannot be composed of several very competitive countries and a few others that are fundamentally welfare states of the community constantly receiving bailouts and other subsidies to keep them at some minimal level of existence.
A lot is being asked of the members of the currency union as the community moves toward greater political union. Nations, and the people of these nations, don't like to give up their national sovereignty.
However, the world is moving into a new economic era. This new economic era is going to require nations to incorporate new goals and objectives in order to remain relevant.
The United States is struggling with this and still doesn't seem to get it, yet. The United Kingdom is also dealing with this. An election taking place on May 7 may push the UK in the direction of Greece, out of the European Union.
The drift of this election appears to be, regardless of who wins, that the UK will lessen its ties with the European Union or even leave it.
Wolfgang Münchau writes in the Financial Times that the British exit actually "happened a long time ago, during the negotiations on the Maastricht treaty in 1991, when Britain obtained an opt-out from the single currency. It was the euro that has been driving Britain away from the mainstream, but the isolation now extends beyond the single currency."
This would make England and what is left of the United Kingdom even smaller and less powerful. The United Kingdom has already suffered for not being a part of the currency union and, as more are commenting these days, seems to be less important in world affairs.
It, therefore, seems very clear that the leaders of the European Union need to stand their ground in dealing with Greece. They need to keep their eye on the end goal. It certainly will not be easy for Greece to leave the EU and it will suffer for it. The EU will suffer for it as well.
However, if the leaders of the Eurozone capitulate to Greece in any manner, then it would signal the end of the effort to create a competitive economic community that can compete on the scale of the United States and China.
It has been hard enough for the Economic union to get where it is now. It is not easy to ask countries to give up their national sovereignty and be a part of a bigger community. Yet, over the longer run, one can imagine a better world for every member as well as the community as a whole.