The Economist: Europe on the rack - Why the euro is breaking the European dream

Economic logic dictates that the euro zone must become more federal, sharing banking risks and issuing debt jointly. Political reality, however, works against this. European treasuries are still national, as is politics. For creditor nations, “more Europe” could come to mean paying the debts of unworthy foreigners; for debtors, it could mean having foreigners intruding ever deeper into their affairs.