3 Musketeers

I am not quite sure what advice Bummer Obama can give to Merkel and Sarkozy that he shouldn't give to himself. What is he going to tell them? Put the eurozone house in order? Throw out Greece? Get the ECB to issue eurobonds? Recapitalise your banks? Don't throw out Greece but support it with more loans instead? That the euro was a disaster waiting to happen when conceived has always been evident to those who knew something about currency unions including people in the Treasury. I do not imagine that they sat on their thoughts and did not communicate them to their counterparts in other Treasuries around the EU. It would be surprising that those other Treasuries did not have some misgivings about how the project would work out and thus it is astonishing that no contingency plan has been worked out for the Greek tragedy now playing out before our eyes. When Greece defaults, as it will, will other countries also default? If other countries default what will the effect be on the EU itself? Some maintain that as the EU did not have a eurozone to begin with that it could revert to its pre euro state but others maintain that if the eurozone splits into a hard currency zone and a soft currency zone that it will bring about the total collapse of the EU. Andrew Lilico is one of those who believes in the latter and in an article in the Telegraph today paints this horrifying scenario. Will it happen and if it does will it be as bad as Lilico predicts or better or worse? I do not want to find out and so the eurozone must survive even without Greece and Portugal (but what about Spain and Italy?). If Bummer makes this point to Merkel and Sarkozy he will have done something useful for once.