I lost interest in what he was saying in his long winded article after the first few paragraphs.
How do we make things work here in the US?
>> So I think it's obviously wrong to say "the Euro is bad". It's a great thing for France and Germany and Belgium and the Netherlands and several other countries in the Eurozone. But expanding the Euro to Greece maybe was a bit too far.
I don't know how Greece would have been better off with Drachma. I mean Drachma is still convertible currency, no? Greece isn't Zimbabwe. They can't just print money, can they?
Maybe this is naive but I don't understand how currency matters unless you have some weird third world level conversion control.
By being one country as well as one currency region.
That's not just a glib answer. The US can use federal financial transfers to help, say, Mississippi. But the EU can't use direct financial transfers to help Greece, because EU rules (IIUC) don't allow it, and Germany (for example) wouldn't put up with being taxed to pay for it even if the rules allowed it.
> Germany (for example) wouldn't put up with it even if the rules allowed it.
It makes sense. I have a lot of respect for Germany but there's probably some limit to how much they can make miracles happen. The nineties wasn't that long ago and my understanding is Germany has invested a lot in Eastern part of Germany over the last two or three decades. I'd be apprehensive about pouring money into Greece if there's no common identity between Greece and Germany that instinctively reassured me that if there was some tragedy in Germany, there wouldn't be "foreign aid" from Greece but rather the same disaster relief as Greece would offer itself.
My understanding though is that the common identity is still rather weak. I'm not just poking at the French. Seems like all Europeans think of themselves as Brits, Spaniards, Italian, or bla bla bla before they think of themselves as European. I think I listened to someone argue that the EU is not a country and never will be based on how the Constitution behind less preamble:
>> HIS MAJESTY THE KING OF THE BELGIANS, THE PRESIDENT OF THE CZECH REPUBLIC, HER MAJESTY THE QUEEN OF DENMARK, ...
I think they tried to argue that the EU is somehow superior and more modern compared to these United States of America. I don't know much about the Eurozone but I'm very optimistic because I don't see any other way Europe doing any better than barely surviving if it did not unite.
More importantly, I think the stupid and nostalgic old people will die at some point.
> Just over 70% of 18 to 24-year-olds who voted in the referendum backed Remain, four major academic and commercial polls conducted shortly after the ballot agree, with just under 30% backing Leave.
> In contrast, only 40% of those aged 65 and over supported Remain, while 60% placed their cross against Leave.
https://www.bbc.com/news/uk-politics-45098550
I am optimistic, for what it is worth.
The point is that there are definitely economic benefits to the simplicity and low-overhead of currency union among equal and near-equal partners, but when economic conditions vary greatly between regions (or more correctly, when economic conditions change differently over time in various regions), there can be a greater benefit to having different currencies that can trade at different levels against each other to assist in the proper valuation of resources in either region.
There's no 100% right answer, and national boundaries are not necessarily the "optimal" borders for currency areas, but obviously there are practical issues to weigh as well.
So I think it's obviously wrong to say "the Euro is bad". It's a great thing for France and Germany and Belgium and the Netherlands and several other countries in the Eurozone. But expanding the Euro to Greece maybe was a bit too far.
That said, the EU could do a lot via policy to make up for the problems caused by the imbalance of economic conditions between Greece and Germany, but ... they aren't doing nearly enough.