THE euro-zone crisis has transitioned from an acute phase to a chronic one. At just this moment the fear that market panic might force one or several economies out of the single currency is low. Yet few analysts believe the euro zone has solved its fundamental problems. In a piece published at Vox EU last week, a cadre of prominent economists made the very sensible point that unless euro-area leaders can agree on the fundamental causes of the crisis, they will struggle to craft long-run fixes. The authors set out their view of the crisis, in hopes that it will prove a foundation for consensus building. Their explanation, which strikes me as the right one, is that the euro-area crisis was not a sovereign-debt crisis. If it had been, one would have expected Belgium and Italy, which entered the crisis with extraordinarily high debts, to have landed in serious trouble. As it turned out, they made it through without troika programmes, while Ireland and Spain, which entered the crisis with low levels of sovereign debt, needed bail-outs. The problem, instead, was one of massive capital flows across borders, which encouraged high levels of private borrowing in the economies that eventually got into trouble. When the global financial crisis generated a reversal in those flows, private borrowers and banks got into big trouble. That trouble translated into serious economic downturns and bank failures, both of which led to explosive growth in sovereign debt burdens.

Exploding sovereign debt was the symptom rather than the cause of the crisis. It is worth pointing out that Europe's current financial calm is not a result of the fact that European economies have brought down their sovereign-debt burdens. Public debt loads are bigger now than they were in 2010, not smaller. (Germany is a notable exception). And while euro-area economies have engaged in austerity, several continue to miss their budget targets. Bond yields have plummeted not because of the return of fiscal sobriety, but because the European Central Bank is buying loads of public debt and has promised to do what it takes to keep the euro-area together.

Why, then, has the crisis response been so focused on sovereign borrowing? It probably mattered that the first country to get into trouble was Greece, which did have a big public-debt problem in addition to its other woes. At 129% of GDP in 2009, Greek public debt was (and remains) the highest in the euro area. The crisis narrative therefore centred on public debt as a crisis indicator—outside the euro area as well as inside it. Britain's austerity push was predicated in part on the notion that it could run into Greece-like trouble. America's pivot to austerity was similarly influenced by the Greek mess.

This fundamentally missed the point. Italy's debt is now larger, as a share of GDP, than Greece's was when it got into trouble. But the yield on Italian debt is now below the yield on American Treasuries.

The misdiagnosis had significant consequences for the trajectory of the crisis. Austerity around the periphery might have been a political-economy necessity—a prerequisite for German acquiescence to ECB debt-buying. It was not an economic necessity. The euro-area downturn was much deeper than it needed to be, and the prospects for a euro-area exit from the zero-interest-rate world are perhaps the worst in the world now—worse, potentially, than the outlook for Japan.

Yet the really disconcerting thing is that while the crisis response (and in particular the steps taken by the ECB to backstop euro-area banks and sovereigns) reduced the threat of scenario in which a market panic causes the ejection of a member country, it reinforced the macroeconomic rigidity of the single-currency area. It was already the case that member states could not set their own monetary policy or devalue to help manage a recession. Now, Europe has moved toward much more stringent budget rules, as well, in the form of the 2012 Fiscal Compact, which tightens the fiscal rules initially agreed in the Stability and Growth Pact and gives the euro area oversight of individual country budgets.

The euro area has stripped away the shock absorbers most economies rely on to reduce the negative effects of demand shocks, and saddled the monetary union with a central bank that is politically unable to respond in dramatic fashion to an economic downturn in the absence of obvious deflationary pressures. That's not a good place for an economy to be. If the euro-area is now safer from markets than it was pre-crisis, it is more vulnerable to the political backlash that will inevitably result, in one country or another, at some time or another, when the strictures of Europe's monetary union become too painful to put up with any longer.