The problems of the euro area brought to light some failures of the system. Nevertheless, the resulting drop in confidence in the system has gone further than one could expect. Questions have even arisen about the system's survival. Yet monetary systems do not tend to dissolve simply because of faulty performance. On the contrary, as a rule they endure even when they function very badly. It takes a political force majeure to bring about the break-up of a single currency area, typically without connection to its monetary performance. Why, then, has the possible default of a country engaged in irresponsible fiscal policy and accounting for only 3 per cent of the euro area's GDP raised questions about ‘saving the euro’ and the survival of the Eurozone? The issue has not received the attention it deserves. It is often simply taken for granted that the departures from the Stability and Growth Pact (SGP) provide a sufficient reason for the earthquake that has shaken the whole currency area. Yet if we look around the world past and present, the mismanagement of finances by regional governments has no particular tendency to bring down entire monetary systems, far from it. In line with the usual – I think superficial – diagnosis of the ailment, proposed remedies for the euro area centre on strengthening the SPG, increasing joint political control over fiscal policy and providing joint insurance against government default, or some mixture of the three. But what if a vital element of the problem is really the official doctrine that sovereign default is incompatible with the euro? What if the scale of the crisis that took place has resulted from financial markets’ conviction, based on that doctrine, that the future of the euro was at stake? What if assuring the long-run sustainability of the euro means convincing those markets, quite differently, that nothing as manageable as a Greek default can upset the euro area? That is precisely what the US example would suggest and what I will defend. In that case, the right road ahead looks quite different. It means shifting the emphasis away from avoiding government defaults toward assuring the stability and the solvency of the banking system at all times, regardless of the financial difficulties of some member governments.