Word: eu
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...Greece and the European Union rush to stop the Greek problem from spilling over into the rest of the EU, we urge them to take heed of popular sentiment and not shore up Greek debt with taxpayer money from Germany and France—the only two eurozone economies in a position to help. Doing so would constitute forcing a stronger political union on eurozone and, more broadly, EU member-countries where such a union does not exist and is not wanted by their citizens...
What may seem like a rather isolated problem is really much more. Ever since the EU, with Germany at the helm, ushered in the Euro in 1999 (some say hastily), the fiscal collapse of any one eurozone country has had the potential to erase confidence in the common currency that underpins the economic structure of them all. A catastrophic loss of faith in the Euro, a currency second only to the United States Dollar in importance, would have grievous ramifications worldwide...
...European Union was initially hailed throughout the world as “the European miracle,” a triumph for supranational organizations and international unity. Banded together in a monetary and trade-based union, the EU experienced rapidly rising living conditions and surprisingly harmonious relations. The last few months have shown, however, that the EU’s economic foundations were fundamentally flawed. Monetary and fiscal policy are deeply related, so a monetary union in which each subunit pursues its own fiscal policy is destined to fail. The best and most practical solution for the European Union...
...EU, monetary policy is controlled by the European Central Bank, and most of the member countries have joined the “Eurozone,” the term for the monetary area in which the Euro is used. Thus, one central bank controls the supply of money for the EU, and individual countries do not have control over inflation targeting, interest rates, and other monetary issues. Yet at the same time, each country is in control of how much its central government spends and the solvency of its financial system, so Germany independently controls its expenditures and tax receipts...
...major step the EU must take is to develop more political and fiscal integration. The optimal economic solution would be a fully integrated fiscal system in which a central European government made decisions in a structure similar to the U.S. Thus, monetary and fiscal policy would be coordinated on the same scope, and Europeans would not have to worry about a single member state bringing down the entire economy, just as no one worries about California’s fiscal problems hurting the stability of the dollar. European countries, accustomed to full sovereignty, are used to full independence, and therefore...