rapid technological advances and population ageing. ensuring that these values are truly reflected in european social models will require many painful decisions, and we must be mindful of the dangers of populism. this calls for a frank and honest political discourse that recognizes the benefits and downsides of globalization and other forces that shape the future. this, combined with a welleducated electorate, and a culture of transparency provide a powerful antidote against populist policies. to survive and thrive in the global competition, europe must not be focused on preserving structures ; it needs to embrace change in order to preserve its core values. this requires innovation not only in business but also in social models.

##ctual analysis is inherently impossible, and i will not pretend to know the answer. but let me just say that we have been happy to sit out the storm within the euro area rather than outside it. the exchange rate is not a straightforward policy instrument. although in principle, it may support faster adjustment of real imbalances, experience has shown that it becomes difficult to control precisely when the challenges are greatest. in times of crisis, the exchange rate tends to respond to financial disturbances rather than to real imbalances and, more often than not, it becomes a constraint on policies rather than a useful adjustment channel. membership in the euro area eliminates one potential adjustment channel, but above all, it eliminates a major source of uncertainty at times when uncertainty is already high. we are glad to accept that trade - off. the final viewpoint to euro membership relates to the role of a small national central bank in the decision making process of a large currency union. decision making in the eurosystem : getting your voice heard this is one aspect of the single currency that is often misunderstood ; what actually is the role of national central banks in the ecb and in the eurosystem? over the past ten years we at the bank of finland have been asked often why the bank of finland still matters. isn ’ t everything decided in frankfurt? what is the role of national central banks? how do the ecb and eurosystem operate? as a result of the maastricht treaty and practices established over these ten years, the institutional structure of the eurosystem is carefully balanced. the hub remains relatively small in comparison to the spokes. in important ways, the eurosystem remains highly decentralised. all important decisions are taken by the governing council, which usually meets in frankfurt. a large majority of the council ( all but six members of the executive board ) are governors from national central banks. they sit around the table making decisions in their personal capacity as members of the governing council, not as representatives of their countries. they are fully independent in this role as are the members of the european commission or the european court of justice. but when each of them is also a head of a national central bank, it is clear that their staff is deeply involved in preparing all issues on the agenda of the governing council meetings. so when the governor takes off to frankfurt, he is thoroughly prepared and carrying loads of papers and briefing notes in his briefcase. the single currency has delivered many important benefits