[Eric in the Ozarks]

The Euro is the first currency created out of whole cloth. Many economists, including Milton Friedman, predicted it would not last a decade. Maybe they were wrong about the timing...

[Olog-hai]

Even all the EU economists predicted the same thing. But after all, that was not the purpose of creating the euro; there was something else in mind, and all the calls for “fiscal union” today should have made it obvious . . .

The European Commission's top economists warned the politicians in the 1990s that the euro might not survive a crisis, at least in its current form. There is no EU treasury or debt union to back it up. The one-size-fits-all regime of interest rates caters badly to the different needs of Club Med and the German bloc.

The euro fathers did not dispute this. But they saw EMU as an instrument to force the pace of political union. They welcomed the idea of a "beneficial crisis". As ex-Commission chief Romano Prodi remarked, it would allow Brussels to break taboos and accelerate the move to a full-fledged EU economic government. …

We all saw what raising interest rates did to Club Med, and for the German bloc. Now watch someone create a treasury out of thin air—and don’t be surprised who it turns out to be . . .