At last the discussions faced up to the facts of this crisis; A currency without a finance ministry, Greece bust, shaky banks, Spain, Portugal and Ireland in difficulty and Italy tottering. This spectacular combination has spooked not only the Euro economy, but most of the Western world, where growth is stalled or stalling.
So the umpteenth meeting is called, dinner is served and yet another agreement is reached in the middle of the night. Everybody, including the market, seems pleased with themselves. Why? The bail out fund is set at E1trillion when it should be at least E2trillion. The banks have been told to find E100billion. They need more. Greece is to have 50% of its debt written off, down from the 60% trailed, when reality demands 75%. As for the new arrangements for fiscal governance, these are barely coherent. Another President, making five in total, in a confection of institutions none of which is democratically elected, save one, the European parliament and that is fiscally powerless. The others have some power of the wrong sort which has little effect when the crunch comes.
The reason at this moment that markets are happier is that for the first time Euroland has an agenda of the issues which have to be resolved. That it at least something, because it means a disorderly meltdown is less likely. Nevertheless the scale of government debt will act as a brake on growth for years to come because some governments, many corporations, lots of individuals and far too many banks have borrowed so much money that servicing it will take ever increasing proportions of income and reducing it will become increasingly impossible. This is why there must be more debt write downs right across the piece. For the moment such thoughts are too much to contemplate.
As for the extension of monetary union to fiscal union, so essential for the survival of the single currency, when the quagmire of Presidents, Working Groups, Councils and Committees are elbowed aside to make way for the simple structure of a Finance Minister, Treasury, Common Economic Policy, Central Budget and beefed up Central Bank and European Monetary Fund, all of it will be built to a German specification, because without Germany the whole thing crashes to ruins.
There is a very long way to go before all this is sorted out.