Europe at a Crossroads: Failed Ideas, Fictional Facts, and Fatal Consequences

The crisis of the European Monetary Union has revealed the weakness and the fragility of the European integration process. The paper examines the institutional changes which are at the root of the instability. What are the driving forces behind the introduction of the euro? What role do theoretical considerations play in this process? What influence on European integration has been exerted by neoliberal beliefs and convictions? Relying on an approach that combines basic insights of Gunnar Myrdal with Karl Polanyi's idea of a "double movement," it concentrates on the institutional transformation that is at the basis of the European integration process. The relationship between (misleading) ideas and facts is at the center of the study. It examines the influence of ideas and theoretical models on European integration, the Single Market Program, the Maastricht process, the increasing imbalances since the introduction of the euro, and the strategies applied during the recent crisis.