Euro desintegration absurd and inconceivable? Really?

Working together is in our genes. It was by working together that our ancestors have survived on the African savannah hundreds of thousands of years ago, ensuring the survival of our species. Economic cooperation with other countries is therefore quite logical. But that does not mean it should be done at all costs. The euro is a good example I believe.

Probably the most frequently mentioned benefit of the euro is that the Europeans do not need to exchange money when travelling to many other European countries. Indeed, one can travel from Finland to Cyprus without the need to pay a visit to a bureau de exchange. I frequently travel through Europe and I can appreciate having that advantage. It saves the traveler time and money: we do not have to pay the exchange fee, gone are the highly disadvantageous exchange rates and we do not end up with all kinds of small change in our pockets when we return home (small change that you cannot exchange anywhere for your home currency by the way). But ...

That argument is much less relevant in 2014 than in 1992. For example, the number of ATMs and POS terminals is much greater. If we still had the guilder, franc, lira or peseta in Europe, we would hardly need to change money anywhere.

By now, the Dutch government has spent billions to save the euro. Billions of euros Netherlands did not have by the way, so it had to borrow that money. As we all know borrowing money costs money: the Dutch will be paying interest rate on those loans for years to come. The Dutch government has also provided guarantees for a total sum  of 201 billion euros for the operation 'save the euro'. So in the worst case scenario, every one of us living in the Netherlands will pay nearly 12,000 euros, which is 201 billion divided over all residents of the Netherlands (including newborns) for the privilege of not having to change money when in Paris, Rome or Madrid. Even if the worst case scenario does not unfold itself: let us say that the final bill will be a quarter of that amount, it still would be  quite a high price for that privilege.

The euro, in my view, is not viable in the long term but every time I say that in a discussion about the future of the euro, two things happen. First, the cost of saving the euro either gets ignored or trivialized. Second, thé counter-argument becomes that the disappearance of the euro is absurd and inconceivable. As if the world did not exist in the pre-euro era! Whenever that ‘argument’ is mentioned, I always ask the question ‘do you know what was in, say, 1991, also absurd and unbelievable’? For me that I could lose everything, including my life, in a war. It happened. And for all of us that we, the Germans, the French, the Greeks and others would use the same banknotes out of our free will. It happened as well so apparently what was absurd and inconceivable once, actually turned out not to be absurd and inconceivable at all. 

(this is the English version of my column written for the Dutch newspaper Metro)