Europe’s Cyprus blunder raises important questions about the nature of EU decision-making and crisis management

One week ago, the EU, IMF and European Central Bank agreed to a bailout for Cyprus that would involve a levy on the country’s bank deposits. The terms of the bailout have been met with surprise and fury in Cyprus and across Europe, and were also rejected by Cyprus’s parliament. Nicholas Veron writes that no matter the outcome, the crisis is likely to cause lasting damage to the trust of Eurozone households in the banking system, and to the EU’s plans for banking union.