The European response to the sovereign debt crisis has exposed a tension between the national and the supranational in a multilevel polity while opening up new political cleavages between the north and south of the Economic and Monetary Union (EMU). This dilemma has become particularly acute for programme countries that were either directly or indirectly in receipt of non-market financial fundingfrom the troika. Drawing upon a new international political economy approach to comparative political economy, this article argues that joining together two distinct macroeconomic growth regimes is the real source of the euro crisis: domestic demand-led models, which predominate in southern Europe, and export-led models, which dominate the landscape of northern Europe. European policymakers assume that all member states can converge on an export-led model of growth. This vision of convergence is exacerbating rather than resolving the imbalance of capitalisms at the heart of the Eurozone.