We can save the euro, but let's get it right this time
The financial crisis will only get worse if some big steps are not taken, and taken soon, writes Colm McCarthy
THERE is an immediate crisis in the eurozone, as well as serious doubt over its long-term viability. There are two tasks, the prevention of a macroeconomic train-wreck over the next few months, and the re-engineering of a proper monetary union for Europe.
The measures needed to deal with the short-term crisis are straightforward and readers deserve to be spared yet another recitation from me. So here is an extended quote from former UK Chancellor of the Exchequer Alistair Darling, writing in the London Independent on Friday: "There are three things Europe's leaders need to do right now. First, even with a new Greek government there is no one who seriously believes that the present Greek fix will work. A plan that leaves Greece with debt at 120 per cent of its GDP in 2020 -- more than it had when it went into this crisis -- is doomed to fail. We know that. So why not fix it now?
"Second, bank recapitalisation cannot wait until next summer. If Greek, Italian or Spanish banks begin to falter, what happened in 2008 will seem like a squall compared to the hurricane that would be unleashed in Europe, and soon.