Over the last few weeks, Greece has once again dominated the headlines with yet another of their periodic crisis and potential threats to leave the Eurozone. Economic pundits breathlessly comment on what an exit of Greece from the Eurozone would do to the E.U., and by extension, the world economy.

Part of this is designed to sell newspapers. After all, Greece is the 51^st largest economy in the world according to Wikipedia, behind such economic powerhouses as Nigeria, Bangladesh, and Vietnam. If the health of the world economy is dependent upon the actions of a country this size, then we might as well throw in the towel now. Of course, one will correctly argue that it is not the fact that Greece leaves the Eurozone that is by itself the problem, but rather than by leaving it will show that one can leave the euro , a taboo that has not yet been broken, which will prompt other more consequential states such as Spain (16^th largest economy) or Italy (12^th largest economy) to exit thereby possibly unraveling the Eurozone or even the E.U., with ensuing bad economic consequences.

This seems like it could be a systemic problem with large economic blocs. This is a relatively new problem, as free trade zones such as NAFTA or the E.U. have never really been tried before in human history. Unfortunately, policymakers and economists who draw up economic models showing the benefits of free trade (and there are a lot of benefits) have failed to capture the fact that these economies are made up of nation states and national cultures. The economic structures in those nation states, for better or worse, are products of those same national cultures. The idea that 19 countries with 19 national cultures could be happy with a single currency and a single monetary policy will likely strike future generations as the height of insanity. Telling Greeks that they have to act like Germans, and telling Germans that they have to act like Italians, and telling Italians that they have to act like Estonians is not an undertaking that is likely to have success over the long term. The economies simply aren’t as integrated as they must appear to the gatherings of foreign ministers and academics who come up with these policies, in whose circles there is largely a single culture. As someone who obtained a masters degree from a business school in which 80% of the students were foreign born, I can tell you from personal experience that in those circles, one doesn’t really notice national cultures much.

However, national cultures do exist on the street, and the economic structures and expectations shaped by those cultures will make it difficult for economies to integrate to the extent that would be necessary to have a smoothly functioning single currency area. By trying to force cultures together as the E.U. has done with the euro, it has ended up discrediting the idea of free trade in certain circles and has ultimately led to more economic instability than would likely have occurred in its absence. Economic blocs like what the E.U. has tried to be might still work, but they would have to be done on a smaller scale with cultures that are somewhat similar like Germany, Austria, and the Netherlands or like the U.S. and Canada. The problem with economic blocs may be that their architects try and grow them too big too fast (they would like to have their names in the history books after all). But when they do this, they may end up creating more problems than they solve.