If the Eurozone follows the precedent of the 1930s, it will not survive. The attractions of escaping
from the gold standard then were massive and they point to a strategy of devalue and default for
today’s crisis countries. A fully-federal Europe with a banking union and a fiscal union is the best
solution to this problem but is politically infeasible. However, it may be possible to underpin the
Euro by a ‘Bretton-Woods compromise’ that accepts a retreat from some aspects of deep economic
integration since exit entails new risks of financial crisis that were not present eighty years ago
