So Long, and Thanks for all the Drachmae
Greece has been bailed out to the tune of $146 billion -- the priciest ever. But instead of a bailout, Europe ought to consider it a lovely parting gift. Greece, thanks for coming over, but the hour is late, and tomorrow's hangover promises to be a nasty one.
Oh -- and Portugal, Ireland, Italy, and Spain? Won't you please grab your coats and hats and follow Greece outside?
The party was a fun one -- at least for certain guests -- but the time has come for the euro to go. Greece should be the first out, as a condition of the bailout -- er, of the lovely parting gift. Then the rest of the PIIGS need to follow suit. And after that? Germany and France can turn out the lights on the eurozone.
The eurozone, as I've said from the start, was ill-conceived, and for a very simple reason. With few exceptions, a currency should only be as widespread as a labor force is mobile.
I can see this is going to take some explaining, but I'll keep it short and simple.
The United States is a big country, in terms of area and population. But a single currency works just fine for 300-plus million people, spread out from sea to shining sea -- and all the way out to Hawaii and to Alaska, too. And it works for us because anybody can be a Californian or a Texan or a North Carolinian or a South Dakotan. We're all Americans, and there's very little, apart from personal taste, to keep us from living anywhere we choose.
So if jobs disappear in California, for example, people can and will go to Texas.
And that means that a single monetary policy can and will work for the entire nation. Each state's economy and employment don't need to rise and fall together, because millions of people maintain the balance themselves -- by moving around. And Americans move around a lot, more than any other people in the world.