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There is, however the question that I would ask is why the decision to start dismantling things would end at the euro.

It won't. You'll see a rollback at least to Maastrict, if not to Rome. Possibly with the partial exception of Schengen, because people have gotten used to being able to travel hassle-free throughout Europe. But the Rome institutions have enough institutional depth and a long enough history that they will probably survive.

European integration is a project carried forward by momentum, e.g. Monnet's bicycle. Unless you keep moving forward, you fall off.

That was true a generation ago. It is not obvious that it remains true today.

Moreover, forcing Germany out of the euro does nothing to solve the underlying divergence between the core and periphery.

Nobody's billing it as a solution to the lack of industrial policy. It's a solution to the current account imbalances, not the industrial underdevelopment.

It simply provides a mechanism to close the gap which is not without cost.  Devaluation forces up the cost of imported goods.  This is equally true of inputs, fuel and other natural resources, as well as finished products.

Yes, they will have to pay full price for imports. That sucks, and you can argue that it's unfair. But getting a discount on your imports by maintaining an overvalued currency gives the countries who support your currency political leverage over you. And as it happens, in contemporary European politics, that's a bad trade.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Apr 9th, 2012 at 04:29:10 PM EST
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