Comments on: The euro is on life support, and the on-off switch is in Frankfurt Wed, 16 Nov 2016 01:37:11 +0000 hourly 1 By: dingodoggie Sat, 03 Dec 2011 14:49:10 +0000 Thank you for this good summary of the current situation of the Euro zone. I agree with you that the Transfer Union is already operating, and that, while this may work for some time, the planned construction of a fiscal union will not be stable in the long run.

In the past, I believed an “United States of Europe” would be a reachable goal, and that the Euro (and especially the exptectable Euro crisis) would be the major tool to reach this goal. In a way, both seem to become true now – the Euro crisis as anvil to forge the Union. But the internal tensions in countries ruled by a German-led Fiscal Union are bound to break into the open through radical political movements, like the Front National in France or the Lega Nord in Italy. The later the final divorce comes, the higher will be the costs.

One needs only to look at history to see that state unions of different peoples, and with an inequilibrium of power and size, never are stable on the long run. Unless the largest 4 EU countries break up voluntarily (which will not happen), the EU should better remain an alliance of independent countries, not trying to convert itself into an U.S.-style Union.

By: SleepyJohn Fri, 02 Dec 2011 01:01:51 +0000 Thanks for the tip about the ECB’s surreptitious manoeuvring. I have been wondering what safety valve the Germans had in place to avoid the risk of accidental global meltdown as they force the euro nations to the brink of collapse. A very neat little conspiracy – the Germans steer the ship while the ECB keeps it afloat and the politicians run round the deck whipping the passengers into a state of terror over the impending disaster.

When they reach the point of screaming to be saved at any price the EU steps in and says: “We can save you and this is the price: fiscal integration involving ‘some kind of democratic political control’.” I imagine it will utilise the simple Single Vote System – Germany votes for what it wants and the rest do as they are told.

I suspect this marriage will go for a long time yet, having been carefully planned since the EU was first set up with the deceitfully misleading title of Common Market, but there will be no more ‘equality of the sexes’. I think he who pays the piper is very happy with the way the tune is playing out.

By: scyth3 Thu, 01 Dec 2011 11:32:14 +0000 and which partner are you married to, laurence? the feckless spender? so a poor analogy

on the positive side, the dutch prime minister (wall street journal) has given a succinct statement why the dutch govt opposes euro bonds and supports the german govt’s position 052970203441704577068391832690410.html?m od=googlenews_wsj

and here is reuter’s own lawrence summers (ex-fed) giving good overview of the european banking system and why politicians are not good at fiscal discipline

the euro is worth saving: ummers-the-euro-is-worth-saving?videoId= 225991379&videoChannel=4301