On Tuesday, finance ministers from the Eurozone will meet virtually to discuss how to best address the region’s economic crisis. Top of the agenda is the issue of “coronabonds”, a debt instrument that will allow countries who share the same Euro currency to also jointly issue debt to meet healthcare and other economic needs.
Nicholas Mulder, a postdoctoral associate in the department of history at Cornell University, studies modern European history with a focus on war and internationalism. He says that while the tools at hand to ease the economic crisis in Europe are not new, the shock the entire continent currently faces is unprecedented.
“Europe is facing probably the most severe socio-economic crisis since World War II. There are plenty of proposals for common action circulating, but many lack the scale appropriate for the size of the crisis.
“The most prominent idea is to create a common European debt instrument. This is not new; in the 1970s the oil crisis prompted the European Economic Community to issue its own bonds, which has happened a dozen times since then. But the shock to GDP currently being forecast for the second quarter is in the double digits. It is difficult to convey just how damaging that is.
“Only Eastern Europe has experienced anything like that in living memory, when it transitioned out of state socialism in the 1990s. Now the entire continent faces such a shock and needs to cushion it together. Any fecklessness courts not just economic disaster but very dire political consequences.”