Abstract

The continuing crisis in the Eurozone invites reflection on the reasons for the apparent inability to resolve the crisis in the short term, if at all. There are several explanations. These range from lack of political will, stalemate and failures of institutional design to Machiavellian readings that EMU was expected to fail. Thus, its failure would enable a further, crisis-driven round of integration. The explanation offered in this lecture accepts elements of these arguments but also considers the possibility that different varieties of capitalism might effectively co-exist within the framework of the European Union. This concept derives from the principle that 'not everything that is possible is compossible'. I interpret this principle in terms of an increasing heterogeneity of the European Union, the dominance of Modell Deutschland within the EU, the pathological co-dependence of the German model with Southern Europe (cf. US-China interdependencies), and the problems of global financialization.