Why a monetary union cannot work without also being a political union
Foreseeing the future is difficult. But sometimes it seems as though some people get it terribly right
…Some day the nations of Europe may be ready to merge their national identities and create a new European Union – the United States of Europe. If and when they do, a European Government will take over all the functions which the Federal government now provides in the U.S., or in Canada or Australia. This will involve the creation of a “full economic and monetary union”. But it is a dangerous error to believe that monetary and economic union can precede a political union or that it will act (in the words of the Werner report) “as a leaven for the evolvement of a political union which in the long run it will in any case be unable to do without”. For if the creation of a monetary union and Community control over national budgets generates pressures which lead to a breakdown of the whole system it will prevent the development of a political union, not promote it.
There would, of course, be huge problems of turning the European Union into a kind of United States of Europe. And when the peoples of Europe are asked about the prospect, a clear majority says no....MORENicholas Kaldor (1971)
Importantly for folks who muck about with commodities, Kaldor also coined the term convenience yield and developed Working's thoughts into The Theory of Storage.