Fiscal Union

09.05.12

The Euro Misses A Victim

Bulgaria recently announced they will forgo adopting the single Euro currency. This decision was certainly influenced by observing the struggles of other small economies, such as Spain and Greece, when tied to the same currency as Germany. Over at the Worden Report, however, you'll find dismay that Bulgaria dare say "thanks, but no thanks" to this one-way ticket on the Hindenburg.

A union is more than the sum of the parts, and definitely more than the strategic interests of the stronger states, such as Germany. In opting out of the euro, Bulgaria unwittingly was placing itself on the periphery, yet again, as well as on the side of the states outside the euro that oppose additional shifts of sovereignty in the federal system (those states, such as Britain, even deny the federal system itself, supposing the E.U. to be some kind of network). It makes sense in a narrow fiscal sense for a responsible state such as Bulgaria to beg off having to rescue states that had been much less responsible fiscally. However, the state’s interest belies a lack of responsibility in the larger sense—in what one might call statesmanship. The hypertrophy of state power in the E.U. makes this kind of responsibly rare indeed (which is why the U.S. went early to shift relatively more sovereignty to the federal level—albeit not to consolidate).