(...)
The Greek crisis was never a serious threat to Europe. Greece accounts for less than two per cent of the EU’s economy. A default by Athens could be managed as a controlled explosion. A default by Rome, on the other hand, would blow the European economy to smithereens.
The calamity now overtaking Italy was ordained when the euro was launched. In order to qualify, governments were supposed to have brought their total debts below 60 per cent of GDP; Italy’s was 114 per cent.
Several economists pointed out at the time that admitting the Italians would be like inviting an elephant into a coracle but, as usual in the EU, political dreams trumped economic reality.
(...)
Because, for supporters of the single currency, this was never about economics. As the German Chancellor, Angela Merkel, told her MPs last week: ‘If the euro fails, Europe fails. We have an historical obligation to protect by all means Europe’s unification process begun by our forefathers after centuries of hatred and bloodshed.’
Put in those terms, of course, the issue is literally beyond argument. If you oppose the euro, according to Mrs Merkel, you’re in favour of war. Full story...
Don't miss:
The Greek crisis was never a serious threat to Europe. Greece accounts for less than two per cent of the EU’s economy. A default by Athens could be managed as a controlled explosion. A default by Rome, on the other hand, would blow the European economy to smithereens.
The calamity now overtaking Italy was ordained when the euro was launched. In order to qualify, governments were supposed to have brought their total debts below 60 per cent of GDP; Italy’s was 114 per cent.
Several economists pointed out at the time that admitting the Italians would be like inviting an elephant into a coracle but, as usual in the EU, political dreams trumped economic reality.
(...)
Because, for supporters of the single currency, this was never about economics. As the German Chancellor, Angela Merkel, told her MPs last week: ‘If the euro fails, Europe fails. We have an historical obligation to protect by all means Europe’s unification process begun by our forefathers after centuries of hatred and bloodshed.’
Put in those terms, of course, the issue is literally beyond argument. If you oppose the euro, according to Mrs Merkel, you’re in favour of war. Full story...
Don't miss:
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