Is the real threat of the European debt crisis being underreported in the US?

When news articles appear in the United States about the serious problems currently plaguing the European debt markets, the articles tend to focus on the fiscal worries—and consequent default risks—of individual nations. (Regular consumers of business news in the US are certainly familiar enough with the recent stories of Ireland's credit woes).

But are we missing the bigger picture?

Earlier today, I wrote briefly about that bigger picture, in reference to an article from today's Financial Times that suggested Portugal may consider withdrawing from the European Union.

In the US media, suggestions about the dissolution of the EU have been less frequent. And it isn't because the European financial crisis isn't getting coverage in the United States.

Articles discussing the immediate risks to investors in Eurozone sovereign debt appear in American news outlets with a fair degree of regularity. There seems to be no shortage of articles that report on the yield and price movements of the affected bonds. This example, from a Bloomberg News / BusinessWeek story published earlier today is fairly typical. The article focuses on the current yield trends of sovereign debt within the Eurozone, and on the late breaking political developments that drive those yield movements.

A longer form article from today's New York Times focuses principally on the current political considerations and financial mechanics involved in a future Irish financial bailout.

Detailed attention is given to policy options for addressing the Irish crisis within the existing EU political framework; current financial data relevant to Ireland's debt problems are analyzed with considerable granularity. Yet no mention is made of the potential for a broad structural unraveling of the European Union—while the European press today was suggesting exactly that.

Another longer form article, this one appearing in today's Wall Street Journal, makes short reference to the specter of a breakdown in the European Union itself. Brief mention is made, in the third paragraph, of the possibility that Portugal may face "a scenario of exit from the euro-zone"—but the topic is not raised again for the remainder of the article.

In the Journal article discussed in the paragraph above, one gets the impression that the potential breakup of the European Union merits only a kind of worst-case scenario footnote—that of the catastrophic last domino to fall at the end of some long chain of grim but unlikely events.

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