Rather like “neighbourhood watch” programmes in local communities, this would also spread policing responsibilities and involve national parliaments and fiscal institutions in enforcing the rules. Debt ceilings, however, contain an inherent “good times” bias – there is nothing to prevent national governments infringing them when difficult decisions about adjustment and  BIS central bankers’ speeches  5  consolidation have to be taken.
One way to prevent this – and to ensure that decisions are in the collective interest – would be to make public debt issuance a union competence for euro area countries. Member States could transfer to a supra-national agency the right to issue their debt, up to levels agreed by the Council in the context of the yearly approval of the stability programmes.