The Economist “speculated” last week about the kinds of contingency plans Angela Merkel might have on her desk for the breakup of the Euro. Obviously, if such plans existed, they ought to be kept secret so as to not panic the markets. Right?The Finnish foreign minister disagrees:
“We have to face openly the possibility of a euro-break up,” said Erkki Tuomioja, the country’s veteran foreign minister and a member of the Social Democratic Party, one of six that make up the country’s coalition government.“It is not something that anybody — even the True Finns [eurosceptic party] — are advocating in Finland, let alone the government. But we have to be prepared,” he told The Daily Telegraph.“Our officials, like everybody else and like every general staff, have some sort of operational plan for any eventuality.”
This little slip was quickly rowed back by the Finnish minister for European affairs, as well as by other European leaders. Angela Merkel even came out in support of Mario Draghi’s now weeks-old statement that the ECB would do “whatever it takes” to preserve the Euro. Nothing to see here, move right along.But the cat is edging out of the bag. That most European countries have contingency plans is not surprising—it would be irresponsible if leaders didn’t think through worst case scenarios and have plans at the ready. The real news is that leaders are increasingly talking about these plans openly. Could a full-blown currency crisis be closer than anyone thinks?