French President Nicolas Sarkozy helpfully summed up the results of this month's [December's] summit. He told Le Monde that there are now two Europes, one that "wants more solidarity between its members and regulation, the other attached solely to the logic of the single market." The Europe of regulation wants to press forward with deeper integration, stringent budget rules and a transition away from nation-state democracy.Agreed--twice.
The problem is that no one asked the peoples of Europe whether they wanted this. Nationalism is on the rise. Budget rules have been flagrantly ignored in the past, and the Franco-German plan does nothing to deal with the euro's structural problems, which make southern European countries grossly uncompetitive.
It is obvious to most outsiders that the euro zone's problems remain. The rating agencies have been unimpressed, and downgrades of most euro-zone members and their banks are now more likely than ever.
Wednesday, January 04, 2012
Iain Murray and James Bennett in the Wall Street Journal (alternative link here):