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Unfinished business

Europe on the Brink, a Policy Brief published by the Petersen Institute for International Economics, makes for grim reading. My favourite quote from it is this subheading:

This potential break-up of the euro area is exactly what happened in the ruble zone when the Soviet Union broke apart.

“Potential”? Also, I think, for “euro area” read state-backed but not gold-backed currencies everywhere.

But the USSR comparison is spot on. When the USSR disintegrated, this was rightly hailed as a triumph for capitalism, but not rightly hailed as the triumph of capitalism. There were other walls yet to fall, other statist follies yet to be destroyed. The commanding heights of the economy used to be thought of as big companies that did physical stuff to physical stuff. 1991 was the date when the idea that governments should micro-manage such enterprises got its comeuppance, and the torrent of high quality stuff that has gushed forth ever since continues, as yet, unabated. But the real commanding heights, the loftiest and most commanding of all, the politically (mis-)managed currencies of the world, are only now collapsing.

Think of our current travails as the unfinished business of the twentieth century.

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5 comments to Unfinished business

  • John B

    I think there are too many agendas at stake for the powers-that-be to allow the EU to break up.

    Whatever is needed to be sacrificed in order to maintain the incoming empire will be sacrificed.

    It may mean trashing an awful lot of ordinary people’s wealth to do it.

    And, of course, in the end it will go the way of all delusions.

  • Jan

    most of the “ordinary people” don’t have any wealth left!

  • pete

    ‘Think of our current travails as the unfinished business of the twentieth century.’

    Better still to think of them as unfinished business.

  • RRS

    The New Commanding Heights by
    Arnold Kling and Nick Schulz

    In: National Affairs V.8 Summer 2011

    This quarterly is getting to be pretty good. They have a website and hold the old Public Interst archives.

  • Paul Marks

    One of the central mistakes of the Yeltsin government was to (under Western advice) underwrite the governments of the other members of the “Commonwealth of Independent States” (the thing that replaced the Soviet Union).

    They should have said “you are not part of the Russsian Federation – our government has nothing to do with you”.

    But, instead, they createrd money to back the governments and banking systems of all the CIS members.

    One would hope that the politicians (and so on) of the leading members of the European Union (especially Germany) would have learned not to repeat this folly.

    All logic and reason suggests that they must have learned something.