The Euro: its operational succes

With the introduction of the Euro national governments have, for the first time in the history of mankind, transferred their monetary sovereignty to a supranational institution, keeping their budgetary policy within their own competence. However, from an economic and a political point of view the Stability and Growth pact may be not sustainable in the long run, which entails the risk of weakening the convergence criteria. The best way to guarantee ongoing fiscal discipline is to have an overall budget for the Euro-area as a whole. That implies the acceptance of a political union, already foreseen in the Werner Report of 1970, as its logical consequence.