But there are also good reasons for separate currencies and defended borders but the best reason comes from the world of engineering. The reason a ship is divided into sections with bulkheads that can be tightly closed is that when things go wrong, it is highly advantageous to be able to seal off the problem area.
The Euro would have probably not gotten into so much trouble except that its introduction coincided with a bunch of other whacky neoliberal ideas that practically ensured that catastrophic hole-in-the-hull-style problems would arise.
ECB President Trichet Praised Ireland as the Model for the EU to Follow
By William K. Black
Ireland is not like Greece. It ran a budgetary surplus during its boom. It privatized and reduced work restrictions. Its budgetary crisis would be serious because it suffered from one of the worst bubbles (relative to GDP) in history and it lacks a sovereign currency. Ireland’s budgetary crisis is crushing because its political leadership, gratuitously, decided that a nation of four million people should bail out the creditors of Irish banks even though it had no legal or moral obligation to do so and was incapable of doing so. The Irish banks’ creditors were primarily foreign, particularly foreign banks. Absent the Ireland’s failed and quixotic attempt to bail out the German banks Ireland would not be in a sovereign debt crisis.
Ireland, along with Iceland, became the Cato Institute’s Exhibits A & B for the purported success of deregulation and desupervision. European Central Bank President Trichet shared the Cato Institute’s praise for Ireland’s policies, but he came to Ireland on May 31, 2004 to make another claim – the “Celtic Tiger” proved the triumph of Ricardo over the errors of Keynes. Trichet made clear that he was an anti-regulatory supply-sider.
Trichet began his address in the traditional fashion of any polite guest – he sought to find something in common with the audience and he praised them.
“Speaking about Ireland’s EU Presidency, and noting that the outgoing President of the European Parliament, Pat Cox, is also Irish, I cannot resist mentioning with pride my own Celtic roots as a native “Breton”!”
“[T]the process of transformation that [Ireland] began over four decades ago has become a model for the millions of new citizens of the European Union. The new Member States of the EU have had to confront economic challenges whose magnitude and long-term importance are similar to those that faced Ireland when you began your work. Thanks to Ireland’s economic success, to which you devoted your life, we can be confident that economic reform works.” more