The euro is “a common currency of 19 countries and 340 million Europeans” and it indeed “reminds a bumblebee that shouldn’t be able to fly that it still flies.” Then there are proclamations like the one by Donald Tusk – “the euro has matured into a powerful political force in the world”. But no one went as far as Chief Commissioner Jean-Claude Juncker, who said “the euro has become a symbol of unity, sovereignty and stability … it has delivered prosperity and protection to our citizens and we must ensure that it continues to do so … this is why we are working hard to complete our Economic and Monetary Union and boost the euro’s international role further.” He would really make a great general secretary of the (communist) party!
Of course, none of that is true and it’s surprising that the euro has survived 20 years. For example, the Economist dedicated three rather pessimistic pages to the currency’s anniversary. Italy is back at the 1999 level of living standards. Europe has been tragically divided by the monetary union, which didn’t bring promised welfare and stability. Thousands of young people emigrated from the Southern countries after the budgetary discipline dictate brought by Germany and France. Yet, 25-30 percent of those who stayed remain unemployed.
And it was none the better in the Norther states, regardless of full employment. Some experts even call the last decade lost and it doesn’t look like it’s going to get any better. Sadly, Juncker is right about one thing. Unless the EU takes responsibility for budgetary planning from its members, the common currency won’t be crash-proof. The euro is simply strengthening the so-called ‘anti-cyclic’ economic development and the EU lacks a fiscal tool to compensate for the Southern deficit, neither has a coherent and unified European nation.
While the New Hanseatic League, a grouping of Ireland, Denmark, Sweden, Finland and Baltic states formed last February, calls for a necessary settlement of accounts between Northern and Southern Europe, Germany incorporated a monetary union stop sign into its constitution and it doesn’t want to share its astronomical international trade balance surplus. So, when a crisis strikes, there will be a lot of ‘patching up’ again.
It took nearly 100 years for the US to develop a monetary union and the integration wasn’t done without a civil war. There is no threat of a civil war in Europe, however. European nations are divided into international union elite and patriotic natives, which is why the euro may survive the next crisis.
By the way, Italy plans to introduce its own parallel currency.