Greek CrisisIs Midwife toCompletion of theEuropean Project
formerly the top aide to French President François Mitterrand and the founding president of the European Bank for Reconstruction and Development,is now president of PlaNet Finance.His most recent book is
A Brief History of the Future.
—When the euro was in the process of being created during the
s,itwas clear that it couldn’t ultimately survive without a European ministry of finance and the coordination of tax and fiscal policies for the whole of the euro-zone.This was to be the necessary next step after the establishment of theEuropean Central Bank.
Of course,because the Berlin Wall fell just as the long process of preparation tolaunch the euro was getting under way,“enlargement”overtook the agenda of the“deepening”of Europe.That is why today Europe is such a strange animal—a unionwith a central bank and single currency but without a ministry of ﬁnance to coordi-nate ﬁscal and tax policies across a series of independent sovereign states.Now Europe faces a moment of truth.We are now realizing that having a singlecurrency means there must be a great deal of solidarity across the eurozone or every-one will suffer.If Greece fails,so will Spain and Italy and even Germany and the rest.There are a lot of assets at stake because European economies have become so inter-twined through the transactions of the euro economy that,as with the securitizedmortgage crisis,no one really knows the full extent of risks that might emerge out of this black box if Greece defaults.Simply,integration has gone too far to allow the ﬁnancial collapse of Greece orany other state in the eurozone.Though ﬁrst appearances might suggest that this crisis is pulling Europe apart—for example,the great resistance of the German public to bailing out Greece if it
Though ﬁrst appearancesmight suggest that this crisisis pulling Europe apart, in factthe end result will be that itwill compel Europe to completeits “deepening” agenda.
AS THE WORLD TURNS