The current crisis over the euro has deep roots in the imbalances between north and south, rich and poor, export-led and service-driven economies, tied together by a currency but few rules, and those rarely enforced.<\/p>\n
A fix will require fundamental changes in the functioning of the bloc, with more interference in the workings of sovereign states. There would need to be a fiscal union, with a treasury and a finance minister capable of intervening in national budgets, and more unified tax and pension policies. But it is far from clear that the European Union can gather itself to take these fateful steps away from nationalist identities to a truly European model.<\/p>\n
\u201cWe are today confronted by the greatest challenge our union has known in its entire history,\u201d\u009d said Jos\u00c3\u00a9 Manuel Barroso, the head of the European Commission. \u201cIt is a financial, economic and social crisis. But also a crisis of confidence \u201d\u201d in our leadership, in Europe itself, in our capacity to find solutions.\u201d\u009d<\/p>\n