Making the European Monetary UnioneBook - 2012
Europe’s financial crisis cannot be blamed on the Euro, Harold James contends in this probing exploration of the whys, whens, whos, and what-ifs of European monetary union. The current crisis goes deeper, to a series of problems that were debated but not resolved at the time of the Euro’s invention.
Since the 1960s, Europeans had been looking for a way to address two conundrums simultaneously: the dollar’s privileged position in the international monetary system, and Germany’s persistent current account surpluses in Europe. The Euro was created under a politically independent central bank to meet the primary goal of price stability. But while the monetary side of union was clearly conceived, other prerequisites of stability were beyond the reach of technocratic central bankers. Issues such as fiscal rules and Europe-wide banking supervision and regulation were thoroughly discussed during planning in the late 1980s and 1990s, but remained in the hands of member states. That omission proved to be a cause of crisis decades later.
Here is an account that helps readers understand the European monetary crisis in depth, by tracing behind-the-scenes negotiations using an array of sources unavailable until now, notably from the European Community’s Committee of Central Bank Governors and the Delors Committee of 1988–89, which set out the plan for how Europe could reach its goal of monetary union. As this foundational study makes clear, it was the constant friction between politicians and technocrats that shaped the Euro. And, Euro or no Euro, this clash will continue into the future.
Europe’s financial crisis cannot be blamed on the Euro, James contends in this probing exploration of the whys, whens, whos, and what-ifs of European monetary union. The current crisis goes deeper, to conundrums that were debated but not resolved at the time of the Euro’s invention. And, Euro or no Euro, these clashes will continue into the future.
Baker & Taylor
A probing exploration of the reasons behind the Euro crisis illuminates the dual challenges of the dollar's privileged international position and Germany's persistent account surpluses in Europe, identifying factors that have compromised the Euro's stability including conflicts between politicians and technocrats and questionable member-state regulations.
James (European studies, Princeton U.) presents an account of the origins and development of the European Monetary Union. He argues that it was not a fundamentally political project, as some have asserted, but instead was a response to genuine problems of currency instability and misalignment at the international level that gained greater momentum in those moments when global imbalances threatened the international economic system in the late 1960s, the late 1970s, and the late 1980s. He also describes how the failed initiatives of the 1970s, led by politicians, gave way to the more successful initiatives of the late 1980s and early 1990s, led by central bankers. Finally, he addresses how political issues concerning national sovereignty and the redistributional consequences of integrating monetary policy led to imperfect agreements on such crucial aspects of the monetary union as fiscal rules and banking supervision and regulation. Belknap is an imprint of Harvard U. Press. Annotation ©2013 Book News, Inc., Portland, OR (booknews.com)