Can the euro be saved?

A move afoot for EU control of eurozone-member budgets.

http://online.wSportsJournalists.com/article/SB10001424052970203802204577064573943069702.html

For the euro to work, the EU needs to have control of national budgets. I can't see the euro continuing without fiscal controls in place.

 

I would have a hard time being German and watching the Greeks continue to party down and be outraged by the mere mention of austerity. But if a bank is too big to fail, how is a continent not?

 

The argument for whether to save the euro or not comes down to whether you align yourself with liberalism or realism. Does the existence of the EU, which mandates democratic systems and free markets, promote peace in Europe?

Could peace in Europe be maintained if states reverted to pre-World War I policies where each state built up their militaries and competed for colonies to maintain the balance of power, which created a security dilemma?

 

There would be nothing wrong with a fiscal union of the EU as long as it was governed by a democratically elected legislature and/or executive on the one-man, one-vote principle. Germany would be the very first nation to reject that idea, but it'd be a photo finish with all the other countries.

 

If giving up control of national budgets is a part of the plan to save the Euro then the answer to the question is "No, the Euro can't be saved."

 

There IS a democratically elected EU legislature. Granted, no one pays the first bit of attention to either it or the elections for it, the latter of which are typically used to make "statements" by voting for third parties and the like. I couldn't tell you the name of my MEP if you put a gun to my head.

 

I know about the European Parliament, deskslave, but I meant a legislature with the power to set a unified EU budget for euro zone member countries. That's a far cry from whatever powers the current Parliament has, which I'm unclear on, and I'll bet many members are there with me on that.

 

Most Europeans are with you on that. As far as anyone here knows, all the European Parliament ever does is set ridiculous laws about the shapes of vegetables.

But yeah. You have to have a joint monetary policy to have a joint currency, and I'll be emperor of Europe before that happens. The only thing holding the euro together at this point is the dread fear of what happens if it falls apart.

 

This. I'm not sure why the average German would want the Euro to be saved. They've got to be SO sick and tired of bailing out the EU deadbeats.

 

But then what happens to German banks who have lots of Greek debt. And if the Euro goes and every country reverts to thier own currency countries like Italy probably devalue and will be unable to pay the Euro denominated debt. Can Germany afford to let the Euro fail?

 

Nope. And that's why the populist stuff doesn't work.

Germans may well be tired of bailing out the rest of Europe. But that's the consequence of lending so much money to the rest of Europe, the better to finance their "export-driven" economy. The rest of Europe was buying German exports using German money. So it's the old canard about me owing you $1,000 or $1 million. One's my problem, the other's yours. Same with Germany.