EU currency system is broken and needs fixing
THERE has been a remarkably weak policy response to the Eurozone crisis relative to non-euro countries equally affected by the financial crash. Others have responded more effectively, notably the United States where a sustainable recovery seems finally to have commenced. The manner in which the Eurozone was constructed in the 1990s is the main problem. It is just a common currency area without the necessary institutions that would make it into a proper monetary union. Add in the absence of the Franco-German political leadership that traditionally fixes problems in Europe and the nightmare for distressed Eurozone members could have several more years to run. "If it's not broken, don't fix it" may be a sensible motto for business and political leaders, but it has a corollary: if it really is broken, you had better quit pretending. After five years of sticking plaster non-solutions, it is now abundantly clear that the European common currency system is broken and needs to be fixed.