The 17 finance ministers of the countries that make up the euro zone and use the single currency known as the euro, are meeting in Brussels, Belgium at the European Union headquarters today.
The ministers were discussing ideas that would have been taboo until recently. The ideas being shopped around include countries ceding fiscal sovereignty to a central authority; some kind of elite group of euro nations that would guarantee one another’s loans, but require strong fiscal discipline from anyone wanting membership.
There is worldwide fear that the crisis,which has already forced bailouts of Greece, Ireland and Portugal, could infect larger economies such as Italy, the euro zone’s third-largest economy. If Italy were to default on its debt of €1.9 trillion ($2.5 trillion), the fallout could spell ruin for the euro and send shock-waves throughout the global economy.
The goal of the ministers today is to find a commonality among nations both financially and politically. There is no time to waste, it must be addressed immediately before the contagion continues a crippling spread.
France’s finance minister, Francois Baroin, said Tuesday on France-Info radio that countries should integrate their budgets more closely and monitor one another’s spending. “We have to modify eurozone governance,” Baroin said. “We definitely have to move toward more integrated budgetary consolidation, fiscal convergence with our neighbors.”
Baroin said France and Germany, which have largely been calling the shots on efforts to overcome the crisis, will make proposals on how euro-zone countries can monitor one another under such a new system.
The world is watching developments. It’s not just a currency used by 332 million people that is at stake. As German Chancellor Angela Merkel and others have said, if the euro fails, so too does the 27-nation European Union, a rousing diplomatic success that united a continent ripped apart by two world wars.