The pact’s last stand

The ECB and national central banks have been quick to issue warnings against the latest reforms to the stability and growth pact, which they see as a further undermining of fiscal discipline within the union. The latest changes agreed in Brussels towards the end of March were yet another attempt to resolve a simple conundrum: how to reconcile the problem faced by EU governments in pursuing individual political programmes, when the economic levers of changes in external exchange rates and interna