Do it now, not next month

To judge by the plunge of the stock market on Thursday and the new upturn in the public debt differentials, the financial markets share the fear of recession manifested by the US Federal Reserve (Fed) with the launching of new stimulus measures, which reveal the deep concern among those who know most about the American economy and the financial stresses that weigh upon the world economic system. But, in spite of the continuing slump in the markets and the reluctance to lower risk premiums, which to any observer reveals an ill-concealed panic about the chances of escaping worldwide stagnation, the EU's economic ministers have yet to face decisively the ever- more inevitable bankruptcy of Greece and, should this happen, the risk of the disappearance of the single currency in the short term.

An example of such irresponsibility is the fact that, with the Spanish risk premium at 370 points and prospects of an unemployment rate of 20 percent throughout next year, the only concern of the opposition Popular Party leader in the last session of Congress was the Faisan ETA tipoff case. Or the fact that the new plans to save Greece are being put off until October, and are conditional upon further adjustments of questionable nature, which will collapse the incomes of much of the Greek population.

The United States, at least, has done what it had to do. Obama, Geithner and Bernanke believe it is possible to reactivate the economy by stimulus measures. The so-called Operation Twist aims to bring down interest rates in the long term, to favor those market segments that seem most sensitive, such as the mortgage market and corporate financing in general; channeling $400 billion into the purchase of Treasury bonds with terms of from six to 30 years, financed by selling an equivalent quantity of bonds with terms of under three years.

An operation of this magnitude shows that the US believes recovery is possible, and is implementing the policies needed to achieve it. But here in the EU the overseers of the euro seem to be asleep, while the stability of the single currency crumbles. Christine Lagarde, director of the IMF, has rightly remarked that their decisions are correct; that national plans are boldly facing the deficit adjustments; that the July summit proposed a courageous reform of the EU's financial architecture; but that there is "a time lag between these commitments and their implementation."

To maintain this time lag in a situation of uncontrollable fear amounts to culpable negligence on the part of those responsible for the euro. We all know what has to be done to put an end to the market panic and the debt, and to offer hope for recovery: lower the interest rates, approve the Greek bailout, authorize the creation of eurobonds, and implement at last the "new financial architecture" discussed in July. But not next month, or in function of the interests of France and Germany: do it now. With the same urgency as if Europe's survival as a place of economic well-being were at stake.