HANNES ANDROSCH: Former Finance Minister and Vice-Chancellor of Austria.

In Europe, nothing happens in a moment. Fundamental changes occur minimally and slowly, at best. Thus, great significance is being attached to the fact that the European Commission is authorized--for the first time--to borrow on international capital markets with the full fiscal backing of the European Union. This is novel, and in the views of many experts reaching back to Milton Friedman, long overdue.

As a gesture of solidarity with the countries most affected by Covid-19, it is to be warmly welcomed. It may even be the thin end of the wedge which will lead to further, similar responses in the future. But for now, it is strictly a once-off program and light years removed from the fiscal and transfer union required to support the European monetary union and its currency, the euro.

For one, it is structured as just another program. It fits into what passes for an EU budget but which, in reality, is a rigid framework for (some) collective national expenditures, without scope or need for deficit financing.

Second, it is a tool of the twenty-seven member countries of the European Union, and not of the nineteen members of the eurozone. As such, its responsiveness to the requirements of the euro is likely to be limited. And, more important, it does not confer any degree of fiscal autonomy on an unelected European institution with responsibility for safeguarding the euro. This remains with the heads of government of the EU member countries, whose primary allegiance is to their national electorates. Worse, any such decision by this body would have to be taken unanimously, giving the heel-draggers the final say.

A monetary union requires an adjunct fiscal arm, with fiscal autonomy, to provide support for regions in recession when business cycles are not largely synchronized. Second, a fiscal authority is also important on a union-wide basis when "liquidity trap" conditions prevail. And, in the absence of European treasury-type securities, the development of the euro as a global rival to the dollar is inhibited.

But arguably the main reason why such an institution is...