Eurozone Dystopia

Eurozone Dystopia

Groupthink and Denial on a Grand Scale

William Mitchell

Eurozone Dystopia traces the origin of the Eurozone and shows how the historical Franco-German rivalry combined with the growing dominance of neo-liberal economic thinking to create a monetary system that was deeply flawed and destined to fail. It argues that the political class in Europe is trapped in a destructive groupthink which prevents it from seeing their own policy failures. Millions are unemployed as a result and the member states are caught in a cycle of persistent stagnation and rising social instability.

Chapter 18: Framing the debate: two alternative visions of the economy

William Mitchell

Subjects: economics and finance, political economy, post-keynesian economics, politics and public policy, european politics and policy, political economy


. . . there really is no alternative. (Margaret Thatcher, British Prime Minister, Press Conference for American correspondents in London, 25 June 1980) There is no alternative to the monetary union. (Wolfgang Schäuble, German Finance Minister, Deutschland Financial Times, 12 March 2010). When considering the options that Europe faces, it is important to frame the debate in an acceptable economic framework. While poor political motivation cannot be ignored, a major part of the problem that currently besets the EMU nations arises from the application of a flawed macroeconomic framework that has been used by officials and their political masters since the 1980s. The gap between the 1970 Werner Report and the 1977 MacDougall Report, on the one hand, and the Delors Report (1989) on the other, reflected a fundamental shift in economic thinking towards Monetarism and its current neo-liberal manifestation. This shift reflects the re-emergence of the free market ideology rather than any superior appeal to evidential authority.

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