What the Euro Zone Can Learn From the U.S.

European Commission President Jean-Claude Juncker and Boris Johnson traded barbs this week over how far the EU intends to push its integration agenda. In a speech on Wednesday, the U.K. foreign secretary accused the EU of seeking to create an "overarching European state." Not true, Juncker responded: "I am strictly against a European superstate. We are not the United States of America."

This exchange of views looks baffling to an economist. The question is not what level of integration Europe intends to reach, but how much cohesion is needed to support the existing institutional framework, including monetary union. The risk is that the euro zone remains a halfway house, vulnerable to a repeat of the sovereign debt crisis which took place at the start of this decade.