Bank of England Governor Launches Attack on Eurozone Austerity

The Governor of the Bank of England has warned that the failure of leaders from wealthy European states to help their poorer counterparts could cost the eurozone a “second lost decade.” Mark Carney’s comments in Dublin came only days after Greece’s anti-austerity leftist party Syriza topped the polls in the country’s general election.

“The answer is to build the risk-sharing institutions that are present in any successful currency union,” he said, adding that a monetary union will not be complete until mechanisms are built to share fiscal sovereignty.

“It is difficult to avoid the conclusion that, if the eurozone were a country, fiscal policy would be substantially more supportive. However, it is tighter than in the UK, even though Europe still lacks other effective risk-sharing mechanisms and is relatively inflexible,” he said. Credit: Bank of England