This chapter describes the evolution of Europe's monetary union as a French initiative motivated by goal of achieving monetary and economic parity with Germany. The Schuman Declaration in 1950 brought European nations together in a spirit of reconciliation and laid the preparatory basis for post-War Europe. In 1957, the Treaty of Rome enabled the flowering of the European community—which, by the mid-1960s, had completed its primary task of establishing an institutional framework for cooperative coexistence and, by opening trade borders, had enhanced the material capabilities of the nation state. However, the European monetary union project in 1969 resulted in severe economic problems. Forcing one monetary policy on divergent nations made no logical or practical sense. Thus, repeated efforts to fix exchange rates predictably failed. Ultimately, the pursuit of monetary union created great risks and did little for Europe's real economic problem of generating long-term growth and reducing unemployment.
