Only One Bed for Two Dreams
Only One Bed for Two Dreams
The architects of the euro could see that an independent central bank and a mechanism to enforce budgetary discipline were not enough to ensure the new currency’s viability. They could see that a lasting monetary union was bound to require something more, but could not agree on what this “something” was. Jacques Delors, then president of the European Commission, saw the euro as a milestone on the road to an even more ambitious endeavor: a “federation of nation-states.” German chancellor Helmut Kohl largely spoke of “political union”, while Mitterrand’s France spoke of “economic government”. Both these expressions were borne of the same intuition, but superficial differences obscured deeper convergence and fuelled suspicion. In the end, the euro was created without significant political foundations and without any mechanisms for solidarity between countries, and Eurozone countries were left to deal with the challenges and risks associated with the common currency on their own.
Keywords: Europe, euro, monetary union, Jacques Delors, European Commission, Helmut Kohl, Germany, France, political union, economic government
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