Thus historical analyses have shown that the monetary unions of the 19th century failed largely as a result of mismatching fiscal policies.13 Consequently, Article 104 of the Maastricht Treaty, as well as the Stability Pact adopted by the ECOFIN Council in Dublin in December 1996 largely at the urging of the then German minister of finance, Dr Waigel, attempt to combine the advantages of a fiscal policy which, in operational terms, remains a national responsibility with the necessity of a set of common rules.
There are four main reasons for this. First: to avoid a conflict between fiscal and monetary policy.