''Two years ago, economists were still taking bets on the probability of a
euro zone break-up. Today the threat of a currency collapse has
receded. The European Union
may have seen its legitimacy wither, as evidenced in the recent
elections, but somehow the euro currency has pulled through – just.
Unhappy Union: How the euro crisis – and Europe – can be fixed is a timely account of the financial crisis that shook Europe to its core.
Written by two Economist journalists, the book displays the
publication’s trademark punchy style, balancing narrative and analysis
to present an engaging account of the causes of the euro zone crisis,
and its impact on the European project as a whole.
After a useful recap on how the EU developed, Unhappy Union delves into
the history of the single currency to establish where things went
wrong. It traces the roots of monetary union, from the establishment of
the European Monetary System, in 1979, to the Maastricht Treaty, in
1992, showing how French fears of deutschmark domination following the
reunification of Germany helped drive the project.
But the flaws of the single currency quickly became apparent. The chief
culprit was the Stability and Growth Pact, the system of fiscal
monitoring that underpinned the euro.
An initial German requirement that sanctions should be applied to
countries that breached the rules was quietly abandoned, and by late
2003 even France and Germany had persuaded the European commission to loosen its targets..''
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