Europe's heads of state have done a lot of summiting and dealmaking of late. Greece has voted more austerity. But on balance theresults have disappointed again. The only genuine help for Europe'ssovereign debt troubles has come from the European Central Bank(ECB), which at last has begun to provide markets much neededliquidity. Otherwise, Europe's leaders, though they have managedsome action, seem incapable of thinking broadly enough even tobegin grappling with the continent's underlying problems.

For all the deep problems facing Europe—questions of default, ofmembership, of its basic political-economic model, even of thebiases built into the euro—the continent's summiteers have kept aremarkably narrow focus. They have considered just two things, infact: (1) how to enforce haircuts on the holders of Greek debt and(2) how to enforce fiscal austerity. Though such matters areimportant and help for Greece hinges on their resolution, they arenonetheless a relatively small part of Europe's problems. UntilAngela Merkel, Nicholas Sarkozy and other European leaders expandtheir focus to deal with the fundamentals, markets and investorswill show no confidence beyond that evoked by the ECB. Yet, ratherthan broadening the scope of their concerns, Europe's leaders havefailed even to reach agreement on the narrow goals with which theyseem so wonderfully preoccupied.