So it’s crucial for further solidarity to be linked to a strong conditionality and for agreements to be adhered to. This holds true not only because the root causes of the Greek problems will otherwise never be fixed, but also for the stability of monetary union itself.
By the same token, a European deposit insurance system seems feasible only if the policy areas that influence the health of banks are European responsibilities. Otherwise, it will open the door to a situation in which the burden of bad national policy choices can be shifted to all Europeans creating severe moral hazard problems. 4.