THESE are certainly troubled times for the euro. But while the crisis is making everyone jittery – not least the financial markets – there are some silver linings for Ireland from the cloud currently hanging over the great European project.

In the short term, there is the fall in the euro's value against the dollar. You won't get Brian Lenihan saying this, but the depreciation of the euro is great news for the Irish economy, which is so heavily dependent on exports to the US. It has given a further boost to our competitiveness and without any of the pain involved when companies were forced to cut wages, personnel and other costs.

The problems in various eurozone countries also mean that the European Central Bank is unlikely to move to raise interest rates from their current record lows until the middle of next year. (There is even an outside possibility that it could follow the US Federal Reserve and bring interest rates down to zero.) All of that is good news for mortgage holders here, many of whom have tracker mortgages, and for the Irish economy generally.

Although there is no shortage of eminent economists predicting the end of the euro, that still seems an unlikely enough scenario. It is understandable why the global financial markets see Europe as dysfunctional. In the US, the federal government and/or the Federal Reserve see what the issue is and act accordingly. In contrast, in Europe, the Germans and French are disagreeing about strategy, there is violence on the streets of Greece and it takes numerous day- (and sometimes night-) long chaotic meetings of all the EU partners before anything can be sorted.

But notwithstanding all the tensions that exist within the EU, the collapse of the monetary union is the appalling vista that cannot be allowed to happen. Failure would threaten the integration of Europe that Germany and France have been so steadily working towards for the past half a century. Flawed as the EU is, the various members do have a track record of muddling through crisis situations and eventually getting the outcome they desire, albeit after much messing about and nonsense.

There is no doubt that the current crisis had been waiting to happen for a number of years. In fact a European Commission report on the euro a few years ago pointed to the problems in the system. The rules covering participating euro countries were simply not strict enough and there was a complete lack of co-ordination between members.

It was madness, for example, that Greece was allowed get away with manipulating its books and that nobody called Ireland to task for allowing budgetary policy to be so dependent on bubble economy tax receipts. Nobody shouted stop.

Of course, the primary responsibility lies with the individual country but, failing that, Europe has to be ready to step in. There's been a bit of nonsense recently – from Fine Gael of all parties – about the impact this might have on sovereignty. But worrying about diluting sovereignty after joining a single monetary zone is closing the door long after the horse has bolted.

In fact, it's a pity these very safeguards were not in place five years ago. If they had been, the Irish economy might not have got into the mess that it did. Clearly the new rules covering member states will have to be a lot more complex than the old limits on the amount of a budget deficit a country can run. Ireland was running massive surpluses for years, but that masked the huge structural problems that existed in the public finances.

The reality is politically the government here could not have gone for bigger surpluses to reflect the dependency on income from the property bubble. There would have been uproar if social welfare rises or public sector pay increases had been curtailed by a government arguing, despite a massive budget surplus, they were not sustainable in the medium term.

It's a poor reflection on politics and, let's be honest about it, the electorate, the media and the quality of political debate in this country, but what is required is a means of handcuffing governments to keep them on the fiscal straight and narrow. Governments need to have the political cover or the excuse of saying: 'We have to rein in spending because of the rules of the euro'.

Some of that handcuffing will have to come from Brussels but if we want to be masters of our own destiny, our own domestic procedures and safeguards will also have to be addressed.

Sweden set up an independent fiscal council of experts to examine, comment on, and have an input into, budgetary and fiscal policy. And it may be time to establish a similar body here in Ireland. Imagine if six years ago, a fiscal council comprising of the likes of Patrick Honohan, Alan Ahearne, Karl Whelan, Philip Lane and Morgan Kelly had been in existence. Things might have turned out a lot differently.

In an ideal world, these kind of reforms in Ireland and the EU would have taken place years ago. But it probably required a crisis situation before the necessary difficult decisions could be taken.

The hope is that what emerges is a more viable, sustainable eurozone – but knowing the EU that won't happen without an almighty struggle.

scoleman@tribune.ie