Euro Tragedy

Description

Blending economic analysis with political drama, EuroTragedy -chosen by both Foreign Affairs and The Financial Times as one of the best books of 2018-is a groundbreaking account of the euro's history and tragic consequences. In this vivid and compelling chronicle, Ashoka Mody describes how the euro improbably emerged through a narrow historical window as a flawed compromise wrapped in a false pro-European rhetoric of peace and unity. Drawing on his frontline experience as an official with the IMF, Mody situates the tragedy in a fast-paced global context and guides the reader through the forced-and unforced-errors Eurozone authorities committed during their long financial crisis. The decision to switch from national currencies to the euro unfolded as both economic and political tragedy. It weakened the growth potential of member states, which made financially vulnerable Europeans more anxious. It deepened perceptions of unfairness and widened the division between nations. Now, the burden falls on younger Europeans, a generation with a discouragingly bleak future. A compassionate view of European possibilities, EuroTragedy makes clear that the euro's structural flaws will continue to haunt the continent. Instead of centralizing authority to prop up an ossified pro-Europeanist model, it is time to loosen ties that bind too tightly so that a liberal order can once more flourish. Now updated to cover the most momentous events since original publication, this will remain the authoritative book on the crisis.

About the Author

Ashoka Mody is Charles and Marie Robertson Visiting Professor in International Economic Policy at the Woodrow Wilson School, Princeton University. Previously, he was Deputy Director in the International Monetary Fund's Research and European Departments. He has also worked at the World Bank, University of Pennsylvania, and AT&T's Bell Laboratories. Mody has advised governments worldwide on developmental and financial projects and policies, while writing extensively for policy and scholarly audiences.

Reviews

"Mody (Woodrow Wilson School, Princeton Univ.) has written a page-turning work that combines deep political and economic analysis with fluent prose...This book provides an excellent historical thread for understanding the current crisis in the EU, and specifically in the eurozone....Summing Up: Highly Recommended." -- CHOICE

"EuroTragedy tells one of the greatest, and most consequential, stories of our time: Europe's attempt to build a political union around a currency. Written with deep scholarship and the wisdom of an experienced policymaker, this landmark book is also a gripping read. Shakespeare would have loved it."-George Akerlof, Nobel Laureate in Economics, 2001

"Ashoka Mody has written a magnificent book on the euro, a story that he rightly describes as a tragedy. As he documents, from the very start there were Cassandras predicting a disaster to come, and at every step of the way, they were dismissed by European leaders, hiding behind political slogans and indulging in shoddy economic thinking. As I read this powerful book, I was reminded of Winston Churchill's famous remark as he reflected on the string of disastrous military decisions that led to the First World War: 'The terrible ifs accumulate.'" -Liaquat Ahamed, Pulitzer Prize-winning author of Lords of Finance

"A magisterial overview of Europe's remarkable single currency experiment. Written in a style accessible to a wide readership, it is a must-read for researchers and policymakers. This brilliant new book would also be perfect as a main text for a university course on the euro and European integration." -Kenneth Rogoff, Harvard University; co-author of This Time is Different

"One does not have to share Ashoka Mody's view that the German government should admit guilt for the Euro crisis to recognize that this book is fascinating reading, full of insight into the history of the euro and its ultimate failure. Written by a leading scholar and former senior IMF official, there is much to be learnt from this extremely well-written and important work. We need books like this to enter a frank and open debate." -Hans-Werner Sinn, author of The Euro Trap

"Mody develops a dramatic historical narrative of how European leaders brushed aside the warnings of many economists and went ahead with the euro, not knowing where this would lead them. Instead of creating unity, the euro has contributed to Euroscepticism and intensified division in Europe. Mody identifies the reason: the Eurozone is an incomplete monetary union that leads to divergence and instability. This 'contrarian' book will not be popular in Brussels, but all the more so elsewhere." -Paul De Grauwe, John Paulson Chair in European Political Economy, London School of Economics

"Written by the former chief representative of the International Monetary Fund to Ireland who was also the deputy director of the Fund's European Department, EuroTragedy provides a detailed yet highly readable first-hand account of the Eurozone crisis."- EuropeNow

Table of contents

List of Figures
Acknowledgments 
List of Abbreviations
Introduction: Europe Ends Up Someplace Else
Chapter 1: Three Leaps in the Dark, 1950-1982
Chapter 2: Kohl's Euro, 1982-1998
Chapter 3: Schröder Asserts the German National Interest, 1999-2003
Chapter 4: Irrational Exuberance, 2004-2007
Chapter 5: After the Bust, the Denial, 2007-2009
Chapter 6: Delays and Half-Measures: Greece and Ireland, 2010
Chapter 7: Policy Wounds Leave Behind Scar Tissue, 2011-2013
Chapter 8: The ECB Hesitates, the Italian Fault Line Deepens, 2014-2017
Chapter 9: The Final Act: A Declining and Divided Europe
Scenarios: The Future Ain't What It Used to Be
Epilogue
Main Characters in the Euro Drama
Timeline of Key Events: How it Unfolded
Notes 
References 
Index