Streeck – On the Euro

“Yet since 2013, an astonishing number of voices have been heard in favour of a flexible currency regime, one that could enable democratic politics to even out imbalances through less destructive means than internal devaluations. The suggestions made range from a return to national currencies, via the temporary or permanent introduction of parallel currencies, together with capital controls, right through to a Keynesian two-tier currency system.37 No nostalgia for the Deutschmark’ is required to see the urgent need for joint reflection on the reconstruction of the European single currency, in a way that might be beneficial for Europe, democracy and society. In principle, this theme might also emerge from the no less urgent search for a better global monetary system than exists at present – one that has become increasingly dysfunctional since
the definitive dismantling of the Bretton Woods regime in the early 19705, and almost brought the world economy to the point of collapse in 2008.  The failure of the euro is just one development among many to dispel the illusion that arose from the anomalously peaceful conditions of the post-war
period – the conviction that what money is and how it should be managed is a question that has been settled once and for all. Debates about a new global monetary and financial regime are now well overdue. Their task will be to devise a system flexible enough to do justice to the conditions and constraints governing the development of all societies participating in the world economy without encouraging rival devaluations, or the competitive production of moneu or debt, together with the geostrategic contests they foster. Agenda items would include the successor to the dollar as a reserve currency, the empowerment of states and international organizations to set limits to the
free movement of capital, regulation of the havoc caused by the shadow banks and the global creation of money and credit, as well as the introduction affixed but adjustable exchange rates. Such debates could take their cue from the astonishing wealth of ideas about alternative national and supranational monetary regimes produced in the interwar years by such writers as Fisher or Keynes. They would teach us at the very least that money is a constantly developing historical institution that requires continual reshaping, and must be judged as efficient not just in theory but also in its political
function. The future of the European single currency could in that way become a subordinate theme of a worldwide debate about a monetary and credit system for capitalism – perhaps even for a post-capitalist order of the twenty-first century. 
Or not, as the case may be. Now more than ever there is a grotesque gap between capitalisms intensifying reproduction problems and the collective energy needed to resolve them – affecting not just the necessary repairs to the monetary system, but also regulation of the exploitation oflabour-power and the environment. This may mean that there is no guarantee that the people who have been so kind as to present us with the euro will be able to protect us
from its consequences, or will even make a serious attempt to do so. The sorcerer s apprentices will be unable to let go of the broom with which they aimed to cleanse Europe of its pre-modern social and anti-capitalist foibles, for the sake of a neoliberal transformation of its capitalism. The most plausible scenario for the Europe of the near and not-so-near future is one of growing economic disparities – and of increasing political and cultural hostility between its peoples, as they find themselves flanked by technocratic attempts to undermine democracy on the one side, and the rise of new nationalist parties on the other. These will seize the opportunity to declare themselves the authentic champions of the growing number of so-called losers of modernization, who feel they have been abandoned by a social democracy that has embraced the market and globalization. Furthermore, this world, which lives under the constant threat of possible repetitions of 2oo8, will be especially uncomfortable for the Germans, who for the sake of the euro will find themselves having to survive without the ‘Europe to which they had once looked to provide them with a safe dwelling place, surrounded by well-disposed neighbours.”
Wolfgang Streeck, How Will Capitalism End? Verso, 2016

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