On March 8, GMF hosted Gabriel Glöckler, Deputy Head of the EU Institutions Division at the European Central Bank, for a roundtable discussion on “The Future of the Eurozone: Right and Wrong Turns ahead,” as part of its Strengthening the Transatlantic Economy event series.
As the European sovereign debt crisis continues to pose a serious challenge to the European monetary union and the continent’s economic viability, questions about the future of the Eurozone are at the top of policymaker’s agendas, and continue to draw attention on the other side of the Atlantic. In his presentation, Mr. Glöckler addressed questions regarding the perspective and priorities for the future development of the Eurozone and outlined what needs to be done and what should be avoided to get out of the crisis. The following debate with participants focused on the role of the European Central Bank and on prospects for Greece and Ireland as they go through the programs of the European Union and the International Monetary Fund.
This roundtable followed a similar discussion hosted by GMF on February 22, that featured Jakob von Weizsäcker, Director General for economic policy at the Thuringian Economics Ministry & Fellow at Bruegel, Brussels and Jacob Kirkegaard of the Peterson Institute for International Economics. At this event, Mr. von Weizsäcker presented his plan for euro area countries to divide their existing sovereign debt into blue bonds and red bonds. The blue bonds, up to 60 percent of a nation's GDP, would be guaranteed by all participating countries. The red bonds, consisting of the remainder of the sovereign debt, would be purely a national responsibility. The subsequent discussion revolved mainly around the question of whether Eurobonds could help to resolve the current debt crisis in the euro area or would lead to a massive redistribution of wealth from stability-oriented countries to profligate euro area nations.