Re: Re: So… Are we all agreed that the Euro is here to stay?

Profile photo of zoro

The Euro, in it’s current form, will only hang around if the German population are willing to pay through the nose for it, and that means much, much more than they have already commited, to keep the periphery nations (pns) average standards of living on a par with their own.
To put it another way there needs to be a Eurozone federal income tax which will mostly go to the poorer states. That is how it is done in the US and UK and no-one knows how it could be done differently.
If the German population can’t accept this then it won’t just be the Euro that breaks up it will be Europe itself, with continual rioting and unrest in the disadvantaged countries destabilising Europe as a whole.
The Germans do very well out of the present situation, their exports are far cheaper than they ought to be for an economy as strong as theirs and it is the pns that are keeping the value of the Euro so comparitively low for Germany who in turn are keeping it far too high for the pns to thrive.
If such fiscal unity can really be made to happen then the Euro will survive, but there is precious little evidence that Germany is up for it.

This article has nothing new in it but encapsulates the problems pretty well.