Suppose Greece had defaulted on its government bonds. That might have caused a flight from the bonds of Spain, Portugal and other European countries with high budget deficits or debt. European bank cross-border holdings of Greek, Portuguese, Irish and Spanish bonds total about $250 billion, estimates the Institute of International Finance, an industry research group. With mounting losses, banks would have trouble raising funds for routine business. Their stocks would drop.

Once bond and stock markets began to sell off, who knows what would happen? Panics thrive on fear and ignorance. After Lehman’s failure, investors rushed to the safety of cash and U.S. Treasury securities. Markets plunged; lending fell; optimism collapsed and the economy sank.

America’s interest lies in preventing a repetition. We ought to support Europe’s rescue package. Europe’s problems aren’t its alone; markets are global. In 2009, U.S. bank lending to Europe was $1.5 trillion. This larger lesson seems lost on the U.S. Senate. Just the other day, it voted 94-0, in a largely symbolic gesture, to limit American participation, through the International Monetary Fund (IMF), in the European rescue. That may be good politics, pandering to populist hostility to “bailouts.” But the overt nationalism could shake confidence and backfire on everyone.