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And yet they thought a shared currency would be no big deal.

• cloakandswagger 10y ago
  Don't get me started. Economists from around the world were adamant that the Euro was a terrible idea when it was founded. Binding dozens of wildly differing economies to one currency controlled by one central bank has always been a pipe dream, but it takes decades for it to start to unravel.
  • ZeroGravitas 10y ago
    The politicians knew a shared currency without sharing other aspects was a bad idea, but they gambled that as the problems became manifest, they would be solved by greater unity. Maybe that was stupid, but it's a different kind of stupid than not listening to the economists.
• mapt 10y ago
  No, this could totally have worked. Once the Euro was implemented, they had a choice: Either do what's necessary for real large-scale labor-market mobility (where migration becomes a typical part of life and a substantial part of every paycheck gets remitted back to one's family), and-or create a fiscal union where Spanish spending gets subsidized by German taxes for the sake of unity. They opened the door a bit to the former legally but didn't force the issue sufficiently to make the numbers work, nor did they let economies collapse in ways that cause large-scale migration (preferring to buoy them up with unsustainable debt). They did little towards the latter. This was inadequate, and caused a massive, entirely foreseeable debt crisis because the ability to print money for the use of a single national economy that desperately needs inflation, was lost. The thing that the Eurodollar politicians were trying to force the 2000's politicians to do, did not come to pass.