Remember, too, that a decade ago, intellectuals on both sides of the Atlantic routinely described Europe – with a population of 500 million and a gross domestic product of $16 trillion – as "the future." American economic guru Jeremy Rifkin outlined a "European Dream" in which cherished values of justice would merge with social equity. Charles Kupchan of the Council on Foreign Relations predicted an inexorably integrating Europe as a global counterweight to the US. With America mired in a global war on terrorism, British author Mark Leonard wrote convincingly about the "Ascent of Europe."
(In an interview in London, Mr. Leonard, cofounder and director of the European Council on Foreign Relations, now argues that Europe's unwillingness to face the crisis head-on means "the best-case scenario is a lost decade.")
That is precisely what the best and the brightest have said in interviews in Germany, France, and Britain in recent months. Because this is a political crisis more than an economic crisis, Europe only has to take the next step in its historic process of integration. The problem is that integration, at bottom, means a sharing of debt – and this is where everything turns nationalistic.
What the current crisis exposes is the incompleteness of the 1999 creation of a common currency, the euro, without a common fiscal policy. A fiscal policy would require mutual obligations. Europe has, in effect, a "dollar" without a Federal Reserve.