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Unsustainability of EU imbalances,
Financial Times April 20th, 2018.

In your leader today (‘Macron’s call for reform and plea for democracy’) you are right to point out the threats to liberal values and democracy in the EU. As regards the ‘periphery’ nations, the concern is justified. Yet the reforms of the EU and Eurozone which you, and most others, support – essentially banking union and fiscal union – will do nothing to solve the fundamental and crucial problem which lies at the heart of these threats for the countries at the heart of the EU: the severe economic imbalance between the so-called southern group of Eurozone members (Italy, Greece, Spain and Portugal) and the northern group, with Germany as their dominant member. Since they joined the Eurozone and adopted the euro, the economic record of these countries has remained lamentably weak.

Furthermore, it shows no signs of durable improvement, with persistent low growth, high unemployment and increasing and overwhelming debt. The reforms proposed may create a theoretically coherent financial structure for the Eurozone but they will at best simply prolong the present official policy of successive financial bailouts for the uncompetitive economies. This is not a durable (or, it should be said, humane and responsible) solution.

Meanwhile the populations of these economies face continued suffering, with the effective dismantling of their countries, economically, politically and socially. It should be no surprise that they are listening to more extreme political voices.