Europe’s Next Great Mistake

PRINCETON – In constructing Europe’s monetary union, political leaders did not think through all of the implications, which led to major design flaws. Worse, they do not appear to have learned from that experience, for they are about to take the same approach to the monetary union’s political analogue.

The logic of the financial crisis is driving Europeans toward greater integration, which implies new mechanisms for political expression. Well before the crisis, the European Union was widely perceived to be suffering from a “democratic deficit.” Now, with many Europeans blaming the EU for painful austerity measures, that complaint has grown more powerful – and Europe’s political leaders believe that they must act now to address it.