Lack of democratic accountability risks an eventual, and possibly extreme, populist backlash. Far from unifying Europe, the euro threatens eventual Balkanisation.
The single currency is exacting a heavy toll among Europe’s political leaders. The virtual suspension of the democratic process that euro membership seems increasingly to demand should be viewed with alarm. Legitimacy, it appears, is expendable; the single currency is not. From the start, the march to European unification has always implied an erosion of sovereignty. But we seem to be reaching the point where the diktats of a small policy elite vastly outweigh the decisions of national parliaments.
A particularly unhealthy development is the emergence of the “Frankfurt Group”, a shadowy collection of senior policymakers, to drive through the measures thought necessary to save the euro. Its reported make-up – Angela Merkel, Christine Lagarde, Nicolas Sarkozy, Mario Draghi, José Manuel Barroso, Jean-Claude Juncker, Herman van Rompuy and Olli Rehn, Nothing any of them has done to date has succeeded in stemming the crisis. On the contrary, their actions have often made matters worse
European leaders will redraft key treaties to ensure that beleaguered economies cannot borrow or spend too much in future as a condition of receiving billions of euros in rescue packages.
However, the treaty changes will involve a transfer of sovereignty, triggering an Irish referendum. The Irish vote, to be proposed at a European Union summit next month, will increase demands in Britain for a popular vote on Europe, setting off calls for referendums across Europe in countries such as Holland, Finland and France.
The UK Government fears the pace of developments in Europe, including the imposition of "technocrat governments" in Greece and Italy, combined with a German demand for treaty change, will make a campaign for an EU referendum unstoppable.