The Great Debate UK

Geithner’s fudge won’t kill the euro zone debt Ouroboros

September 19, 2011
U.S. Secretary of the Treasury Timothy Geithner (R) leaves after talks with Polish Finance Minister Jacek Rostowski in Wroclaw, September 16, 2011. Geithner urged euro zone ministers to leverage their 440 billion euro bailout fund and free more resources to tackle the debt crisis during a meeting on Friday, a senior euro zone official said. REUTERS/Mieczyslaw Michalak/Agencja Gazeta

U.S. Secretary of the Treasury Timothy Geithner (R) leaves after talks with Polish Finance Minister Jacek Rostowski in Wroclaw, September 16, 2011. Geithner urged euro zone ministers to leverage their 440 billion euro bailout fund and free more resources to tackle the debt crisis. REUTERS/Mieczyslaw Michalak/Agencja Gazeta

from Lawrence Summers:

The perils of European incrementalism

By Lawrence Summers
September 19, 2011

By Lawrence H. Summers
The views expressed are his own.

In his celebrated essay “The Stalemate Myth and the Quagmire Machine,” Daniel Ellsberg drew out the lesson regarding the Vietnam War that came out of the 8000 pages of the Pentagon Papers.  It was simply this:  Policymakers acted without illusion.  At every juncture they made the minimum commitments necessary to avoid imminent disaster—offering optimistic rhetoric but never taking steps that even they believed offered the prospect of decisive victory.  They were tragically caught in a kind of no man’s land—unable to reverse a course to which they had committed so much but also unable to generate the political will to take forward steps that gave any realistic prospect of success.  Ultimately, after years of needless suffering, their policy collapsed around them.

from Breakingviews:

Euro zone crisis may be close to resolution

By Hugo Dixon
January 28, 2011

By Hugo Dixon
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.