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Here We Go Again

The eurozone crisis is alive and well and living in Spain.

Apr 30, 2012, Vol. 17, No. 31 • By ANDREW STUTTAFORD
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Then there’s France, facing a presidential election in which the increasingly clear favorite (as I write), Socialist François Hollande, is clearly no great fan of the fiscal pact. And finally there’s the awful, undeniable fact that lies at the core of this tragedy: One size does not fit all. Laurel cannot wear the same suit as Hardy. Portugal is not Finland. Greece is not Germany. A shared currency designed to bring nations together is tearing them apart. Confining them in a monetary union that, as constituted today, cannot realistically cope with the profound differences that define their economies is an insult to common sense, an affront to democracy, and a rejection of elementary decency. Those countries it does not loot, it will sentence to stagnation and worse.

No matter: Whether due to the (not unreasonable) fear of what a breakup could mean, or to fanaticism, careerism, or simple, dumb inertia, the eurozone’s political class is sticking with its funny money. As it does so, other Europeans are quietly passing their own judgment. Stories of capital flight from Greece are not new, but a recent analysis of eurozone central bank data by Bloomberg News appears to show that euros are flowing out of Italy and Spain and into Germany, the Netherlands, and Luxembourg at an accelerating and unprecedented pace.

Just a few weeks ago, Mario Monti declared that the eurozone crisis was “almost over.”

Not yet, I reckon.

Andrew Stuttaford works in the international financial markets and writes frequently about cultural and political issues.

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