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.That is pretty much realized about 95 percent (my guess), and now Greece can be discarded if need be. What a way to do business, yes? never mind foreign relations.
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. …
There were three groups who wanted the Euro spread across Europe...at least in the beginning.
First, the bankers. Trying to run a daily exchange program, and having to calculate how many French Francs to buy today against Italian Lira....drew a lot of speculation. Bringing this to one single currency...stopped the speculation end. It made things less complicated.
Second, the industrial side of Europe thought that the various companies in Spain and Italy would come out ahead...manufacturing items at a cheaper cost of living, and bringing better deals to discount shops around central Europe. It didn’t happen though. Germans don’t buy Spanish-made washers, or Italian-made sofas.
Third, the vacation industry felt it’d simplify their game in life. To some degree....it did make it easier to sell trips to Greece, Spain and Italy....at least to other European Euro players.
The issue here....is that you need to maintain some economic stability, and with half the EU membership...that’s not easily accomplished. Even with France....other than increasing taxation...you can’t solve the current crisis.