Roger Altman, in the Washington Post:
Permanent stability will come only from full union across the board. And markets will support the simple currency structure only if they see a true plan for promptly achieving this. The 17 member-states must jointly put one forward.
One possibility: Eurozone nations won’t do this, and will suffer a horrific economic crash, and political instability unprecedented since the Second World War, including the upheavals of 1968. In a panic, nations agree to relinquish fiscal and political sovereignty for the sake of economic peace and stability.
Jean Monnet believed crisis provided a great incentive for integration because it would force leaders to take unpopular steps that broke with tradition and historical precedent. Maybe so, but I think expereince shows that steps toward European cooperation tended to meet national objectives and benefited from prosperity rather than crisis. It’s hard to find a case where a European agenda took precedence over national interests, or at least the interests of those leading national governments.
The big question not addressed is how Europe relinquishing sovereignty, especially fiscal sovereignty,would bring in taxes and lower budgets. I suppose austerity can be imposed by not spending, but so many countries have a tax collection problem that has yet to be solved. Given that Greece and Italy have made tax avoidance into an art, how do you get around that without repressive measures? And would repressive measures actually work? My sense is that it’s a choice between economic and political crisis, with political crisis happening when people refuse to follow European rules.