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. Last Updated: 07/27/2016

EUROFILE: People Show Little Interest In New Euro




Less than 11 months from now, most of the European Union's 15 member-states are expected to fix their exchange rates against each other and thereby take the final, irreversible step toward adopting a single currency.


Yet in France and Germany, the two countries at the heart of this hugely ambitious project, the public is demonstrating a lack enthusiasm, understanding and even interest, which should be sobering to thoughtful politicians.


Monetary union is far closer than most of the EU's 370 million citizens appreciate. An EU summit in early May will specify the countries participating in the euro's launch next January.


Some economists say that world financial markets may run amok between May and next January, destroying the EU's best-laid plans. Yet if the markets were going to torpedo monetary union, they would surely have already done so.


The problem does not lie in the markets. It lies in the failure of governments, business communities and electorates to achieve a broad consensus about how, in the age of the euro, to address vital issues such as job creation, working hours, tax reform and redesigning the post-1945 European welfare state.


Europe's political classes and business elites want the euro, by and large, but there are serious disagreements about economic policy in the future euro zone. Likewise a gulf of misunderstanding separates government ministers and directors of big companies from voters and workers.


It is not becoming any narrower. In Germany, for example, Chancellor Helmut Kohl is absolutely determined to push through monetary union on schedule, despite survey after survey showing the majority is reluctant to give up the Deutsche mark.


They are still more reluctant when they learn that they are likely to share the euro with Italy. In heavily subsidized eastern Germany, where almost one in five people is out of work, few prospects are less appealing than a pan-European currency designed for a market which (in theory, at least) has no place for uncompetitive businesses.


Kohl's center-right government could nevertheless insist that the single currency is a necessary prelude to Europe's political unification. But the government has long stopped singing from that song sheet, judging that Europe is not ready or willing to learn the tune. If so, then what is the euro for? France's left-wing government thinks it knows the answer. The euro's purpose is to establish the EU as the global equal of the United States and Japan.


Moreover, that is too important a goal for the euro to be managed exclusively by the future European Central Bank, by law an independent but unelected institution. Politicians at the EU-wide level -- led, no doubt, by French Socialists -- must therefore have the right to influence policies.


Such opinions, alarming to the Germans, are of little interest to French people. They want to know what steps can be taken right now to cut the national unemployment rate of more than 12 percent.


Prime Minister Lionel Jospin points to the reduction of the maximum working week from 39 to 35 hours as one answer, but French employers bitterly oppose this measure. They will resist it just as strongly in the age of the euro.


To be successful, a currency needs to be trusted, even yearned for, by those who use it. The risk today is that the euro could be dangerously infected with politics from the moment of its birth.