Can the European Union learn from its fiscal mistakes?

“AMERICANS CANEUGDP always be counted on to do the right thing,” Winston Churchill is supposed to have quipped, “after they have exhausted all other possibilities.” There are two problems with the quotation. First, there is no evidence Churchill ever said it. Second, today the phrase applies better to Europe’s leadership than to their friends across the Atlantic.Take the European Union’s recovery from the pandemic. For the first time since last spring, economic optimism is in the air. Across Europe, vaccines are going into arms, summer holidays are being booked and bars are opening up. The European Commission has just jacked up its growth forecasts for 2021 and 2022, citing the bloc’s €750bn ($910bn) recovery fund as one of the reasons why. This cash should start appearing in European treasuries later this year. As a whole, the ’s will be back at its pre-pandemic level by the end of 2021. This is slightly faster than expected and is due to happen only a few months behind America, which has had the benefit of Donald Trump and Joe Biden’s blockbuster stimulus packages. In the ten-year gap between their initially bungling response to the euro-zone crisis and the pandemic, European leaders seem to have learned some lessons, even if they still have not learned them thoroughly enough.