Italy’s austerity-fueled crisis is a warning to the Eurozone

Re:Italy’s austerity-fueled crisis is a warning to the Eurozone by tempestn on Friday April 12, 2019 @07:00PM (#19649798)

So... is there some way to have both the benefits of multiple currencies and a single one? The convenience of a single currency in terms of cash is becoming less relevant as cash itself is used less, but my understanding is that the main theoretical benefit is that it strengthens the single market. Basically allows EU companies to have suppliers and customers in any EU state, without having to incur currency risks. How great is that benefit? Could some of it be achieved while allowing individual EU members to control their own monetary policy? Or on the other side, could the Euro be kept, but the negative effects somehow mitigated, perhaps via changes to transfer payments, maybe based on the difference between what would be the domestic currency value and the Euro?

[ Parent | on HN ]

Re:Italy’s austerity-fueled crisis is a warning to the Eurozone by pmontra on Saturday April 13, 2019 @07:36AM (#19652378)

> So... is there some way to have both the benefits of multiple currencies and a single one?

Look at the USA as an example. The difference with the EU is that the USA are vastly more homogeneous and I believe there is very little opposition to redistribute wealth from richer to poorer states. The EU is fragmented, almost nobody wants a tight political and fiscal integration. What would be of the USA if state governors were much more powerful than the federal president, to the point that few people would know who the president is and what he can do? This is the state of the EU.

[ Parent | on HN ]

Re:Italy’s austerity-fueled crisis is a warning to the Eurozone by behindmyscreen on Saturday April 13, 2019 @07:59AM (#19652468)

Welcome to the debacle that was the United States Articles of Confederation.

[ Parent | on HN ]

Re:Italy’s austerity-fueled crisis is a warning to the Eurozone by galaktb on Saturday April 13, 2019 @04:43AM (#19651822)

I’d say that has more to do with the regulations in place that ease the movement of goods and people. In that framework having the same currency and wildly different economies actually goes against the interests of your workers too, because it allows companies to outsource labour to other EU countries where the cost of living is radically less, with basically no drawbacks. The solution to this should be a consistent effort to strengthen the weaker economies, but more than anything impose similar taxation policies throughout the EU.

[ Parent | on HN ]

Re:Italy’s austerity-fueled crisis is a warning to the Eurozone by Mirioron on Saturday April 13, 2019 @05:40AM (#19651982)

>but more than anything impose similar taxation policies throughout the EU.

But this would massively hurt the weaker and smaller economies though. Businesses congregate where other businesses are. Workers follow. Brain drain has been a big problem in the EU. If EU countries all have to adopt similar taxation schemes then why would you start a business in Romania if you could just start it in Germany instead?

[ Parent | on HN ]