IT'S NOT Spain, Greece, or the euro; it's Europe itself marching towards irrelevancy:
The opening last week in northeastern Spain of a 37-million-euro stretch of motorway to nowhere is an irresistible metaphor for the euro, an ambitious project conceived in better times that is now seemingly running out of road.Read the rest.
With Spain heavily in debt, the authorities could not afford to finish the highway but opened the completed 6 km section near Lleida in any case to deter illegal joy racing.
If only the euro were bringing joy. Maybe the road in Spain will be completed one day, but for now it is one more reminder that much of Europe has been living beyond its means.
On this score, the euro's woes are largely irrelevant. Europe would have to pull up its socks with or without the single currency. The really big challenges to Europe's standard of living come from globalisation, technological change and ageing populations.
Put differently, if Europe wants first-class infrastructure and a comprehensive welfare state without piling up ever more debt, governments need to shake up working habits to generate the growth that spins off tax revenues.
Yet Europe's response, with policymakers preoccupied by the festering currency crisis, has been tardy. All the while, the rest of the world, especially Asia, has been marching on.
Douglas Roberts, chief international economist at Standard Life Investments in Edinburgh, said it was no wonder that the United States exports more than twice as much to emerging markets as it does to sclerotic Europe.
"Even if Europe were firing on all cylinders, it would be one of the slowest growing regions in the world," he said.