How to solve the so-called “Euro-crisis” (and also save Western Civilisation as we know it)

Here is how to solve the so-called “euro-crisis”: Allow the European Financial Stability Facility (EFSF) to borrow from the European Central Bank. The loans made to eurozone states by the EFSF, and the conditions attached to them, would then have to be unanimously agreed by all the eurozone governments. By doing this, the EFSF would be a vehicle for creating "eurobonds", but Germany would have effective control over the process.

This would solve the “euro-crisis” in a stroke, and could even save the Western world from continued decline. The plan would have the following characteristics:

1 - The plan would remove the “markets” from the equation. What are the "markets"? The "market" consists of a handful of individuals in a handful of private financial institutions who decide where to put the money they have at their disposal. This handful of individuals has no democratic accountability to anyone. They lend money to governments. Where do they get the money that they lend to governments? Some of it comes from deposits, but most of it is borrowed from Central Banks, at a lower interest rate than that at which they then lend it on to governments. This is how they make their profits. They are useless intermediaries who don't do anything except cause trouble when they start demanding extortionate interest rates from the governments to which they are lending. So they need to be removed from the equation. If the ECB could lend to the EFSF and then the EFSF lent to governments, it would simply remove the useless parasitic "markets" from the equation.

(Btw, if you are wondering where the Central Banks get the money they lend to the private banks – the answer is: they create it out of thin air, by pushing a couple of buttons on a computer somewhere).

2 - The plan would give Germany effective control over the fiscal policies of feckless eurozone states. How much is lent by the EFSF and at what rate, would need to be unanimously agreed by all the eurozone governments – thus giving Germany the required veto. What the loans are to be spent on, and the plan for how they are to be paid back, would also require unanimity. This would ensure that the fund is not abused by feckless states. In effect, any member state that wanted to use the fund would have to hand over a substantial part of their fiscal policy decisions to the other member states. If they don't want to do that, then they don't need to use the EFSF - they can just go to the "markets" (which will still exist) and borrow off them instead. But if they are frozen out from the markets, they would need to have the agreement of the other eurozone member states as to their fiscal policy - this would create a de facto fiscal union in the EU.

3 - At the moment the ECB cannot lend directly to governments, because of the danger that it would print loads of money and cause hyperinflation. Under the above plan, the ECB would not be lending to governments but to the transnational institution of the EFSF, which could only act if there is unanimous agreement between the 17 eurozone governments. Again, the responsible member states could just block anything they didn't like.

4 - The ECB would retain complete control over eurozone interest rates - it would decide at what rate it would loan to the EFSF. Thus, the independence of the ECB would not be at all compromised.

5 - Using the EFSF would probably not require a treaty change - the plan could be implemented quickly. It would not require creating any new European institutions since the two institutions involved (the ECB and the EFSF) already exist.