Eurozone Watch

In our new contribution for Project Syndicate, we argue that the European Monetary Union needs a new stability pact which limits not government budgets, but imbalances in the current accounts of the member states. In such a pact, both deficit and surplus countries would be required to use their fiscal and general economic policies to strive for a rebalancing. If countries are uncooperative, they would be fined. In this way, dangerous trends of external indebtness for single countries can be limited as well as excessive beggar-thy-neighbor policies through revaluation limited.

Read the full column at the Project Syndicate Website here.

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2nd part of our series on the EU after the Irish No to the Lisbon Treaty  

The European Council on June 19/20, 2008 did not indicate a way out of the EU crisis which resurfaced with the Irish „No“ to the Lisbon Treaty on June 12, 2008. Nevertheless, one or two likely options are being sketched on the horizon.

Option one is to provide Ireland with a protocol to the Lisbon Treaty, which takes into account Ireland’s most important problems with the Treaty and possibly grants certain opt-outs of community policies. We discussed this scenario, which seems to have the largest support among EU member states at the moment here, explaining why the double-Nice-referendum of 2001/2002 cannot simply be repeated.

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1st part of our series on the EU after the Irish No to the Lisbon Treaty  

The European Council on June 19/20, 2008 did not indicate a way out of the EU crisis which resurfaced with the Irish „No“ to the Lisbon Treaty on June 12, 2008. But before and during the European summit, one “most likely” scenario emerged. The majority of member governments seemed to agree that the ratification process should be completed as far as possible – in order to get a clearer picture which governments or countries actually back or do not back the Treaty, and foremost, to put pressure on Ireland to negotiate some add-on to the Treaty and ratify it soon afterwards.

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