When historians look back at last week’s European Union summit, their most likely reaction will be: “Huh?”

Confronted with looming catastrophe in Greece, Italy and Spain, European leaders convened but accomplished nothing of relevance. They signed a pact that penalizes E.U. nations if their budget deficits exceed 3 percent of their gross domestic product. But the pact fails to address what these nations are supposed to do if interest rates skyrocket when they roll over billions of euros’ worth of bonds in the coming weeks. The European Central Bank has declared it won’t ride to the rescue by issuing euro-bonds that would federalize European public debt — the only plausible solution to Europe’s impending smash-up.

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