The Euro came into circulation 1999, as a common currency for 20 European countries. One of the main concerns or criticism was whether the member countries would lose sovereignty, or their rights to control its own affairs. The Euro is on the road to crashing, and many options are being debated about how to save it, including giving up some sovereignty. The Wall Street Journal reported June 4th, that one of the plans may include the “transfer of sovereignty on fiscal matters.”
Common currencies often look good on paper, but they are an untested experiment. How they weather difficult financial times, is a true test of their long-term viability. When country’s economics get close to the brink of disaster, will fierce individual country nationalism resist giving up some sovereignty to save their bacon?
There has been some consideration given to the idea of a North American currency for Canada, the United States and Mexico, but given the problems the Euro has faced, the likelihood of an “Amero” is dim at this point.
We are seeing history in the making in Europe and the ripple effects will hit the global marketplace, making interesting economic theater.