Future-Proofing the Euro

May 23, 2025--Europe's policymakers must not rely on the next crisis to force reform to the single currency
The euro is at the core of the European project, but its future is far from assured. Introduced more than 25 years ago, it has survived one crisis after another, and its rules and institutions have changed along the way. Yet these changes to the functioning of European monetary union form a poor long-term basis for institutions.

They have spawned ever larger and less constrained monetary and fiscal interventions and sown the seeds for even worse future crises.

This is the sobering diagnosis of Crisis Cycle, a new book on the euro's evolution by a unique trio: Stanford University's John Cochrane, a leading scholar of monetary and fiscal matters; Luis Garicano, once a member of the European Parliament, now at the London School of Economics; and Klaus Masuch, whose lifetime career in the European Central Bank’s engine rooms of monetary policy and crisis management included work with the "troika" that negotiated the Greek adjustment program after the 2010 debt crisis.