The Crisis Europe Needs

Europe s Perpetual Crisis

Europe s Trial by Crisis

Europe s Scientific Meltdown

From Constitutional Crisis to European Crisis

A Eurasian Solution for Europe s Crises

Europe s Crisis of Values

Europe s Crisis of Leadership

European Universities Identity Crisis

Europe and the Global Food Crisis

Is Europe s Financial Crisis Over?

A couple of years ago, the eurozone was in the latter situation. That is why European Central Bank President Mario Draghi s pledge to do whatever it takes to save the euro immediately brought the eurozone s debt crisis to a halt.

GENEVA Europe s slow motion sovereign debt crisis may appear unique, but it is not. Just a few decades ago, Europe had the Exchange Rate Mechanism, which collapsed during a crisis very much akin to the one afflicting Europe today.

Europe s Last Best Chance

Europe s Time to Learn

The Seven Year Ditch

The 1992 exchange rate crisis then tipped the balance. Once Europe s exchange rate system blew up, the southerners argument that Europe could not afford to postpone creating the euro carried the day.

Before the advent of the euro, there were many fiscal crises in individual nation states in southern Europe, which produced waves of high inflation. But, with the single currency in place, the road to solving a fiscal crisis through inflation has been closed, as the European Central Bank (ECB) now stands watch over monetary policy.

While markets remained calm, the Cyprus crisis revealed the full extent of the political disaster that the eurozone crisis has wrought the European Union is disintegrating at its core. Europeans current crisis of confidence concerning Europe is far more dangerous than renewed market anxiety, because it cannot be overcome with another liquidity injection by the ECB.

In other words, the financial crisis now reflects a political crisis of the eurozone one that calls into question the very existence of the European project as a whole. If Europe s monetary union fails, not much of the common market, or of European institutions and treaties, will be left.

KYIV Since World War II s end, France has consistently risen to the challenge of restructuring Europe in times of crisis. In doing so, France became the catalyst not only for building European unity, but also for creating the prosperity that marked Europe s post war decades a prosperity now under threat because of the global financial and economic crisis.

The euro crisis had its origin in German Chancellor Angela Merkel s decision, taken in the aftermath of Lehman Brothers default in September 2008, that the guarantee against further defaults should come not from the European Union, but from each country separately. And it was German procrastination that aggravated the Greek crisis and caused the contagion that turned it into an existential crisis for Europe.

While 2011 was supposed to be the year when European leaders finally got a grip on events, the eurozone s problems went from bad to worse. What had been a Greek crisis became a southern European crisis and then a pan European crisis.

Last Chance for Ukraine and Europe

For the second time in less than four years, Asia is being hit with a major external demand shock. This time it is from Europe, where a raging sovereign debt crisis threatens to turn a mild recession into something far worse a possible Greek exit from the euro, which could trigger contagion across the eurozone.

Unfortunately, the fire brigade is being led by Germany, and its chief is Chancellor Angela Merkel. As a result, Europe continues to try to quench the fire with gasoline German enforced austerity with the consequence that, in a mere three years, the eurozone s financial crisis has become a European existential crisis.

The financial sector has since made every effort to design instruments that protect against price fluctuations, to transform private debt into tradable financial securities, and to gain access to speculative markets. But these efforts were conducive to fraud and delinquency, and thus spurred a wave of new financial crises in Europe in 1992, in Asia in 1997, and in Russia in 1998 as well as a recession in Europe and the United States in the early 2000 s.

During the euro crisis, power in the European Union seems to have shifted towards national capitals in general, and towards one national capital in particular Berlin. But, with Germany introverted, France downgraded, and Britain semi detached, the big story in European foreign policy is that the time has come for the little guy who thinks big.

Europe has now reached the point at which most of its laggards are prepared to accept the social welfare society. This humane European capitalism is now hastening toward crisis ridden southern Europe.

In 2010, Chinese direct investment in the EU totaled only 1.3 billion. Today, when governments and companies in Europe are opening their arms to foreign investors, Chinese companies eager for markets, technologies, and diversification should find rich pickings.

BEIJING Despite repeated assurances by European Union leaders, after more than two years, there is still no light at the end of Europe s debt crisis tunnel. Recently, the president of the European Commission, José Manuel Barroso, referring to a possible Greek exit from the eurozone, told the European Parliament that there is no Plan B.

CLAREMONT, CALIFORNIA The debt crisis in Europe is no longer a European affair. Coupled with fears of a double dip recession in the United States, the European debt crisis is dragging the global economy into another cycle of financial panic and economic recession.

Fundamental economic reforms are usually implemented only after a severe crisis, as was the case in Britain in the late 1970s, in Sweden and Finland in the early 1990s, and in Eastern Europe after the collapse of communism in 1989. The EU has wasted the opportunities afforded by the 2008 global financial crisis and the subsequent euro crisis.

As long as the EU s life threatening political crisis continues, its financial crisis will continue to destabilize it. At the heart of resolving the crisis lies the certainty that the euro and with it the EU as a whole will not survive without greater European political unification.

The tide of crisis, it seemed, had begun to turn, particularly after the German Constitutional Court upheld the European Stability Mechanism, Europe s bailout fund. Despite the ECB s imposition of conditionality on beneficiaries of its potentially unlimited bond purchases, financial markets across Europe and the United States staged a major rally.

Europe s High Risk Gamble

CAMBRIDGE The crisis in the eurozone is the result of France s persistent pursuit of the European project, the goal of political unification that began after World War II when two leading French politicians, Jean Monnet and Robert Schuman, proposed the creation of a United States of Europe.

In the next few months, it will become clear whether European policymakers can compromise and implement reforms that dampen the threat of a eurozone breakup. Either the EU moves in the direction of a more stable equilibrium of closer integration, or the risk of an unstable and disorderly breakup scenario will rise significantly.

Though such a scenario was inconceivable five years ago, when the Greek crisis first erupted, the term Grexit entered the European lexicon soon after, when the crisis reached a new peak. But European leaders seemed to recognize the implications of allowing a country even small, crisis stricken Greece to exit the eurozone.

MUNICH The euro has brought a balance of payments crisis to Europe, just as the gold standard did in the 1920s. In fact, there is only one difference between the two episodes During today s crisis, huge international rescue packages have been available.

At the beginning of the crisis, in 2007 2008, the eurozone s fundamental flaws could have been corrected had Germany been willing to support a joint European crisis response. But German officials preferred to maintain national primacy and thus a confederational approach to Europe.

America s military presence in Europe will be gradually reduced, as will its willingness to take the lead in international crises even those affecting Europe s interests. As a result, while the US will continue to provide intelligence, air support, and ammunition on a case by case basis, as it did recently in Libya and Mali, Europe will increasingly have to act first and alone.

A mild recession is expected in Europe this year, and unemployment is on the rise. Beyond deficit reduction, we need to implement a 120 billion ( 155 billion) European investment plan, and deepen the European Single Market to unleash its growth potential.

Eurobonds plus fiscal rules this formula is the euro s best hope for salvation. Unfortunately, another crisis or two might be necessary before European leaders consider it seriously.

Acknowledging the efforts made by the United Nations, the African Union and the European Union to contribute to a peaceful settlement of the Burundi crisis,