That is, Basel II, at least in its more advanced form, is as much a proposal for strengthening risk management as it is a proposal for improving capital standards; these considerations are, as they should be, inseparable. That inseparability, in turn, as I will discuss later, is an important factor leading to the bifurcated application of Basel II proposed in the United States.
National governments are accountable to their voters. Strong and independent national fiscal councils should clearly explain to the public the potential consequences of imprudent fiscal behaviour for the stability of the country and the euro area as a whole. Unfortunately, we no longer have a lack of examples.