"Coming together is the beginning. Keeping together is progress. Working together is success" Henry Ford's words could be an appropriate mission statement for the E.M.U given the grandeur and scale of European monetary expansion and integration achieved in a relatively short period of time. Yet given the worrying news of the latest IMF global stability report the communal achievements of the past maybe washed away by the old reliables of individual member state differences.
The re-emergence of such nationalist monetary tendencies is natural, cemented by the fact European banks carry the majority of the 'bad assets' burden ($1,400bn) compared to the U.S. Why would Germany, whose economy will approximately shrink by 6% this year, seek to aid fellow member states? Short term interests while completely rational may however serve to undermine the decades of E.U achievement. Synchronizing policies even to a minimal degree should remain an important part of any member’s recovery plan for both philosophical and financial reasons; allowing member states keep faith in the benefits of cooperation and facilitating continual strength of the euro for the medium to long term.
Minister Lenihan's 'sort out your our own house' approach which appeared domestically important in our emergency budget amounts to a survival strategy that we would be naive to think wouldn't happen in other member states if the crisis escalates. Strong guidance by the E.U is essential in forming common strategies and ensuring national barriers do not re-emerge.
IMF global financial stability report:
http://www.imf.org/External/Pubs/FT/GFSR/2009/01/pdf/text.pdf
The re-emergence of such nationalist monetary tendencies is natural, cemented by the fact European banks carry the majority of the 'bad assets' burden ($1,400bn) compared to the U.S. Why would Germany, whose economy will approximately shrink by 6% this year, seek to aid fellow member states? Short term interests while completely rational may however serve to undermine the decades of E.U achievement. Synchronizing policies even to a minimal degree should remain an important part of any member’s recovery plan for both philosophical and financial reasons; allowing member states keep faith in the benefits of cooperation and facilitating continual strength of the euro for the medium to long term.
Minister Lenihan's 'sort out your our own house' approach which appeared domestically important in our emergency budget amounts to a survival strategy that we would be naive to think wouldn't happen in other member states if the crisis escalates. Strong guidance by the E.U is essential in forming common strategies and ensuring national barriers do not re-emerge.
IMF global financial stability report:
http://www.imf.org/External/Pubs/FT/GFSR/2009/01/pdf/text.pdf
