Mody’s ‘Euro tragedy’: the counter story

This is a long and dissenting review, in nine acts, of Ashoka Mody’s book EuroTragedy: A Drama in Nine Acts. It is based on a political economy approach, generally absent in the book. Mody’s work can be added to ‘The euro: it can’t happen, it’s a bad idea, it won’t last’ literature. It presents some fair criticism of the single currency and how the Eurozone authorities have (mis)handled the past crisis, but overall it is too one-sided in its dramatisation of the euro’s history, overlooking key events and the developments that first prompted the introduction of the euro and then made the euro stronger over the years. While Mody thinks the euro is economically illogical and therefore should be discarded, with Germany being the first country to leave, there is a strong consensus among political and business elites –and economists and political scientists on the continent– to retain it. Furthermore, after 20 years public support for the single currency is at its highest ever. There is no attempt by Mody to explain this, which is a pity because overall Mody makes the valid point that for the euro to survive it needs a legitimate political authority to sustain it. The problem is that he thinks that Europe cannot move forward, so he wants it to go backward.

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