Are we witnessing the collapse of the European Union, or its potential strengthening? Both? Neither?
The crisis that is gripping the markets at the moment is the future of the Euro, which after reaching such high’s against the dollar, now is at an all time low.
Much of the problem comes from Dr Angela Merkel ‘s desire to save the fragments of the political union that she and the French so desperately crave. In bailing out Greece, she stated that “if the euro fails, then Europe fails”.
Part of the problem is that “The euro has many flaws, but its weakest link is Greece, whose fundamental problem is that for years it spent too much, earned too little and plugged the gap by borrowing in order to enjoy a rich man’s lifestyle.” However, why were they not stricter criteria for Euro entry, and if there were why weren’t enforced? Because, firstly when it was concieved, times were good economically and no one in high enough places had the foresight to realise that times might not always be as good as they were. Secondly, and perhaps more importantly, the French and the Germans felt they could gain a political upper hand easily by admitting as many countries as they possibly could to the Euro and thus bring the EU one step closer to the nation-state that they hope it will be, with all the top jobs held by either a Frenchman or a German, with bones thrown to the others who are willing to kowtow to the diminution of their respective nation-states, ie, Benelux, Austria and a few others. Even the Americans have chimed in.
As the journalist states plainly, “By any legitimate measure, Greece was unworthy of eurozone membership.” He says that the “game is up for a monetary union that was meant to bolt together work-and-save citizens in northern Europe with the party animals of Club Med.” The concept is bringing Germans, Swedes and Italians and others into the one currency makes no sense. The cultures, irrespective of how much globalisation happens or how fast we can communicate to each other does not seperate fundamental cultural differences.
What’ll happen to the EU? The Germans and the French have invested too much time and money in the project to let it all fall asunder now. So the correspondent predicts what should have always happened, “Greece and Portugal are favourites to be forced out through weakness. At the top end, proposals are already being floated in the Frankfurt press for a new ‘hard currency’ zone, led by Germany, Austria and the Benelux countries.”
So we’ll get a two speed EU, which we have already in places due to all those opt-outs. This means that those “countries” that have most “dissolved in a lukewarm bath of multilateral, transnational, secular, and postmodern fudge” will stumble forward on a path to integration, leading possibly to political union, while the rest of the world and possibly the rest of Europe will see sense and take a more cautious attitude to integrating with each other.
Stephen Walt assess’s the result of the crisis in foreign policy terms correctly when he says “whether Europe grows closer together or begins to spin apart, it’s going to carry a lot less weight in world affairs in the next few decades. Its population is shrinking and aging, its military power is increasingly hollow, and it’s going to be short on money for years to come. If U.S. officials think they are going to get a lot more help from NATO in the decades ahead, they are living in a dream world.”
As David Cameron said when he met Dr Merkel last week, “It goes without saying that any treaty, even one that just applied to the euro area, needs unanimous agreement of all 27 EU states including the UK, which of course has a veto”.
Two speed EU, here we come!