As problems mount in the euro zone, it's increasingly evident that we've been witnessing an institutional failure of monumental proportions.

What is to be done about Greece? Simply keeping it in the euro zone won't help much, even if it's possible. The continuing crisis has sapped confidence in banks not only in Greece, but also in Spain, Italy, Portugal and Ireland, though to varying degrees. Unless there are explicit guarantees to these banks soon, the market will likely take a further turn for the worse.
An absence of guarantees could prompt a broader chain reaction of capital flight and bank collapses across several countries.

The basic problem is that many people won't keep their euros in a Greek bank, and perhaps not in a Spanish bank, either, when those euros can be moved to Germany or some other haven.

Yet German citizens do not appear ready to guarantee Spanish banks or, by extension, the whole credit system of Spain and the other periphery nations. Guarantees of that scope are probably impossible and may also require constitutional changes in some nations.

And the concluding paragraph:

What is most disturbing is that the euro-zone nations are democratic, protective of basic liberties, and have advanced intellectual and research communities. The final lesson of this debacle is that smart nations with noble motives can make very big mistakes. And that should concern us all.

David Fuller's view The Eurozone nations may be democratic but the progression to a single currency was often undemocratic, not least for Germany's citizens who were never asked to ratify any of the really important decisions.

If the entire process had been truly democratic the euro's founders would have outlined a clear path towards fiscal in addition to monetary union from the beginning. That they did not testifies to a belief at the time of the euro's creation that the European-wide electorate would not be willing to ratify fiscal union. The rest you know. Meanwhile, high and rising unemployment in Southern European countries is likely to result in social tensions during the next few months.

Can Europeans be frightened into fiscal union today? And if so, is this desirable? These questions are for Europeans to decide.

Meanwhile, there is probably enough fear within the Eurozone and creative monetary policy leeway to keep Greece in the single currency beyond the June 17th election, at least until the next crisis a few months down the road.