And what of those who dreamt up the single currency wheeze in the first place? Shouldn’t they now be feeling at the very least a trifle sheepish? Not at all, Ferguson reckons. If things play out the way he predicts, they will have achieved their ambition — albeit by somewhat devious means.

“I think it’s worth considering that the architects of the monetary union knew all along that it would lead to a crisis and the crisis would lead to a federal solution. I’m not quite sure how far that was articulated, but I think it was implicit. In fact, you could say it was actually designed to create a crisis,” he says.

In the late 1990s, an internal paper circulated in the Bank of England about a hypothetical break­up of the single currency. It floated the idea that “country I” — and the supposed identity of country I could be speculated upon but was never made explicit — would run an unsustainable deficit. Because there was no legal exit from the single currency, the costs of any exit would be sky high. “And,” Ferguson says, “it was designedly so. That point has held good.

“They [the euro enthusiasts] have achieved what they wanted in that the level of financial integration has gone so far, it’s almost impossible to undo. And it was always meant to be undoable, which is why there never was an exit clause. You were never going to get federalism by any other means.”

Niall Ferguson yesterday (19.6) began the first of this year’s BBC flagship Reith Lecturestitled “The Rule of Law and Its Enemies”.  Investigating whether the West’s institutions, which according to him, are what made the West great, are not now actually undermining its world position through their failure to be overhauled  to meet modern needs. Pretty obvious what Ferguson is really concerned about here – what he sees as the Chinese challenge to the West.

CFR Council of Councils – something special being brewed?