The Eurozone’s problems are not solvable. That will not prevent the political class from pretending they are and going through the motions. There are two possible outcomes:
- Break up the zone and return to separate nations with separate currencies.
- Make the Eurozone a single nation state with a powerful central government that makes the various countries subservient to this new layer of government.
Bob Chapman reports that there is strong pressure for the second alternative:
German Chancellor Merkel keeps moving the field of play away from the European Central Bank, and to the people of the euro zone. That is so she can get legislation to remove the sovereignty of EU members. The pitch is, if the new EU is to work all fiscal decisions that will have to be determined in unison by bureaucratic technocrats, all of whom want world government. This way Germany can lead European countries in locked goose step to one-world nirvanas. Incidentally, Britain’s PM David Cameron is going in the exact opposite direction. He sees an opportunity to allow powers to ebb back to national status from Brussels. What Mrs. Merkel is saying is that existing treaties and the ECB does not have a possibility of solving the euro problem.
Neither alternative solves the problem of too much debt and too much spending. Either alternative requires massive debt defaults and massive reductions in social welfare spending.
The first alternative is preferable to the second for at least two important reasons:
- Freedom is better served with more rather than fewer countries. Anything that strengthens government does so at the expense of freedom.
- The US will be asked to financially support the second alternative. Because there are many in this country who support one-world government and this provides an opportunity to move toward that end, no amount of money will be considered too much assistance.
We should feel sorry for the European people but we should not aid the source of their problems.
