It may well be a “nightmare” (albeit more horrifying for some than for others), but it’s certainly not the end of the Monet dream. The primary objective of the integrative enterprise – to end Franco-German wars and their offshoots among other European states – has been achieved. Exogenous factors, like technological change and the threat for a time of cataclysmic nuclear war, have buttressed the process.
But the process itself has advanced too far to make a complete breakdown a likely, or even a feasible, prospect. Structural adjustments and tactical “retreats” may be required, but a total collapse of the European experiment is not on.
The current crisis has multiple causes, but underlying the various misbehaviours of both creditors (public and private alike) and debtors (also public and private alike) is the fact that the best-intentioned of Brussels Eurocrats, along with the political leaders who have most enthusiastically backed the Monet mission, pressed the Eurozone initiative too hard, too soon. Monetary policy is the bluntest of the macro-economic policy instruments, and not well suited to uniform application over a single community afflicted by wide disparities in levels of economic development. Canadians should know this very well. For example, a tight monetary policy crafted to offset an over-heated economy in Ontario has not always been helpful – say – to Atlantic Canada. Fiscal policy is more flexible and can help to compensate. Hence the Canadian political peace is sustained in part by fiscal measures designed to ensure a reasonably homogenous delivery of public services across the country.
Europeanists now appear to confront the need to choose between losing members from the Eurozone, or pouring enormous sums of hard cash into both their own banks and the public coffers of the most beleaguered powers. In practice they are doing some of the latter, but are likely to get a little of the former anyway. The process will hurt. The pain will afflict some far more than others. In varying degrees, civil disorders will ensue. But they won’t last forever. And Germany and France won’t go to war over the problem.