Eurosceptics are right about one thing, and that is that maintaining a currency union without a central treasury is leaving a crucial control open to abuse. It’s like putting an extra accelerator on the outside of the car, where the driver can’t reach it. If the Euro is worth saving, and I believe it is, then we need to ensure its credibility, and that means stopping member states from being reckless. The easiest way to do that is to bar member states, by law, from borrowing, and instead only having borrowing done at EU level. This will remove a key ability of a reckless member state to thrash the currency.
Now, don’t get me wrong: This is a massive ceding of national sovereignty, and the effective beginning of a United States of Europe. Some countries will not want to do this, and indeed, I suspect that some countries, like Ireland, would be politically unable to do this, and so would have to consider the unthinkable, leaving the Euro. That’s why such a decision would have to be ratified by national referendums. But either way, the Euro’s stability needs stable, well-run countries, and this is the tough love way of getting those countries.