{"id":200913,"date":"2015-11-17T22:22:18","date_gmt":"2015-11-17T22:22:18","guid":{"rendered":"http:\/\/rinf.com\/alt-news\/?p=200913"},"modified":"2015-11-17T22:22:18","modified_gmt":"2015-11-17T22:22:18","slug":"decades-later-euro-problems","status":"publish","type":"post","link":"http:\/\/rinf.com\/alt-news\/breaking-news\/decades-later-euro-problems\/","title":{"rendered":"Decades Later, Same Euro, Same Problems"},"content":{"rendered":"<p>Wolfgang M\u00c3\u00bcnchau <a href=\"http:\/\/www.ft.com\/cms\/s\/fbaae6e0-7f35-11e5-98fb-5a6d4728f74e,Authorised=false.html?siteedition=uk&amp;_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Ffbaae6e0-7f35-11e5-98fb-5a6d4728f74e.html%3Fsiteedition%3Duk&amp;_i_referer=&amp;classification=conditional_standard&amp;iab=barrier-app\" target=\"_blank\">declared recently in his Financial Times column<\/a> that the euro was a mistake, and pinpointed a key illusion. Advocates &#8220;knew that, to withstand the rigors of a fixed-exchange system that resembles nothing so much as the gold standard, countries would have to adjust to economic shocks through shifts in wages and prices &#8211; a course, they believed, that the euro&#8217;s members would be forced to take.&#8221;<\/p>\n<p>That is, the euro&#8217;s advocates believed that reforms could create enough flexibility to mainly neutralize Milton Friedman&#8217;s warning that in the face of negative shocks, countries with fixed exchange rates would suffer large costs: &#8220;If the external changes are deep-seated and persistent, the unemployment produces steady downward pressure on prices and wages, and the adjustment will not have been completed until the deflation has run its sorry course,&#8221; Mr. Friedman wrote in &#8220;The Case for Flexible Exchange Rates.&#8221;<\/p>\n<p>But I never believed that this would work, and I based this skepticism on real evidence. During the run-up to the Maastricht Treaty, which set the whole euro project in motion in 1992, a number of studies focused on the United States &#8211; a currency union that functions reasonably well. Was that because America, with its weak unions and competitive labor markets, had more wage and price flexibility than other nations?<\/p>\n<p><a href=\"http:\/\/www.truth-out.org\/opinion\/item\/33690-decades-later-same-euro-same-problems\">Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Wolfgang M\u00c3\u00bcnchau declared recently in his Financial Times column that the euro was a mistake, and pinpointed a key illusion. Advocates &#8220;knew that, to withstand the rigors of a fixed-exchange system that resembles nothing so much as the gold standard, countries would have to adjust to economic shocks through shifts in wages and prices &#8211; [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":200914,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[487],"tags":[],"class_list":{"0":"post-200913","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-breaking-news"},"_links":{"self":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts\/200913","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/comments?post=200913"}],"version-history":[{"count":0,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts\/200913\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/media\/200914"}],"wp:attachment":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/media?parent=200913"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/categories?post=200913"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/tags?post=200913"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}