Europe\u2019s currency union is built on two key principles. The first is that the central bank must be independent of political control and its policies squarely focused on maintaining price stability. The second is that fiscal policy must be disciplined and never threaten price stability. Price stability, in turn, is the foundation for economic stability and prosperity. These principles and ideas are of German origin. And they distill the gist of Germany\u2019s post WW2 economic history, an economic success story featuring both stability and growth.<\/p>\n
The German success story was meant to be replicated at the European level. The European Central Bank copycatted the Bundesbank. As Germany\u2019s constitution featured a \u201cgolden rule\u201d limiting public budget deficits to public investment, a fiscal pact was to safeguard the ECB by decreeing budget deficits in excess of three percent of GDP as excessive and prescribing their speedy reduction. That pact was named the \u201cStability and Growth Pact\u201d reflecting the German belief \u2013 based on historical experience \u2013 that fiscal and monetary discipline go along with both stability and growth.<\/p>\n
Things have not played out according to script for Europe. …<\/p>\n
Continue reading at http:\/\/www.social-europe.eu\/2013\/02\/europes-perilous-quest-for-stability\/<\/a> Europe\u2019s currency union is built on two key principles. The first is that the central bank must be independent of political control and its policies squarely focused on maintaining price stability. The second is that fiscal policy must be disciplined and never threaten price stability. Price stability, in turn, is the foundation for economic stability […]<\/p>\n","protected":false},"author":187,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[31,532,94,531,530],"class_list":["post-7115","post","type-post","status-publish","format-standard","hentry","category-eurozone-crisis","tag-eurozone","tag-fiscal-pact","tag-germany","tag-price-stability","tag-stability-and-growth-pact"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/7115","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/users\/187"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/comments?post=7115"}],"version-history":[{"count":5,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/7115\/revisions"}],"predecessor-version":[{"id":7120,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/7115\/revisions\/7120"}],"wp:attachment":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/media?parent=7115"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/categories?post=7115"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/tags?post=7115"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nIn Spanish: http:\/\/elpais.com\/elpais\/2013\/02\/07\/opinion\/1360258562_755195.html<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"