Thursday, January 3, 2019

Why the Euro Was a Really, Really Bad Idea

I continue my work as unpaid publicist for economist Ashoka Mody. OK, you don't want to read his lengthy (but great!) book EuroTragedy? At least read this interview with the UK website spiked! It is absolutely lucid; the interviewer asks excellent questions and Mody's answers will give you a crash course in the :Euro and what's wrong with it (and where we are now).
Two key grafs:
"I spent two years tracing the history of the Euro, and asking the question: what brought the Euro into existence in its current form? You see, it is not just that there is a Euro. There is a Euro, which is a single currency in an incomplete monetary union, with a set of fiscal rules that are evidently economically illiterate – and nobody questions the fact that they are economically illiterate, that they lack a necessary fiscal backstop and the necessary fiscal union. So why does it exist?
That is when I started writing what is, in effect, a postwar European history, a companion, if you will, to Tony Judt’s Postwar: A History of Europe Since 1945. That is when I realised the Euro was not only a bad economic idea, it was also a bad political idea. Not only was it clear it would cause political divisions, there was also no plan on how to heal those divisions, to counteract them. So these mythologies grew around the Euro, transfiguring it as an instrument for peace, a means to bring Europeans together, a necessity for the Single Market. All these strands of mythology grew up and around the European project to sustain what is, effectively, a mindless idea."
Ashoka Mody on the arrogant delusion of the architects of the EU.

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