The Greek euro Crisis ...?

The problem evoked by the Greek financial crisis is not due to differences in the structure of economies ... the same differences exist within the United States, and for example within the UK ,as any comparison between Vermont, New Mexico, and Manhattan; or betweenn the Highlands of Scotland, Cardif, and Central London will reveal, Contrasts in the structure of regional ecoomies is inevitable unless you are considering a national economy as small as that of Monacco or Luxembourg.

The crisis is not therefore caused by diversity alone, rather the difficultes result from the absence of a single monetary authority. In the construction of European Institutions to control the euro, european politicians, once again, sought compromise rather than coherence. They avoided the issures surrounding the creation and administration of a Eropean Monetary Authority with the centralized powers required to perfom its assigned tasks and objectives. Consequently, they failed to create the decision-making structures capable of compelling states to respect normal budget and banking rules ...i.e. you don't borrow or spend more than you can afford.

The difficulties faced by governments and nations that fail to respect this elementary rule will, as in before theexistence of the euro, face grave political and economic consequences. Even with an inadequate instiutional structure, the euro will reduce some of the risks that national currencies experienced in the long years of serial attacks on the exchange rates of relatvely isolated national currencies,

The real hope is tha the Greek euro crisis, and the menace of subsequent speculation or difficulties with the economies of larger countries, will force european politicians to create institutions with the required strength to insist that national govenments, and entire nations, repect the immutable fact that no slight of hand will permit nations or govenments to consume more, in the long run, than they produce.

Pessimists should note that in every crisis Europe is left with the choice between disaster and facing up to unpleasant facts. Increasingly there is the need to coordinate and enforce common policies in the intrests of all. The progress of european institutions over the last half century have illustrated this in extremis growth of institutions and the delegation of power by national actors to central authorities time and time again . Indeed, whenever the politicians have been confronted by their inability to influence threatening world, or even european events, they have fondit necessary to combine and act together.

The only real question is how far things have to deteriorate before stumbling, short-sighted, national politicians, and their electorates face up to the inevitable consequences of limited means. In the present crisis, however little some european decision-makers may like the european solutions available, the political and economic costs of failing to extend mutual assistance and the imperative need to make the irresponsible toe the monetary and fiscal line, are too great for the euro and its monetary institutions to be allowed to fail.

Finally, and long past the most appropriate time, Europe will be forced to make the necessary choices to save the euro. Speulators beware! The euro is condemned to survive, and to be strengthened.