Saturday, 22 October 2011

The Eurozone

So, I confess to being something of a 'Euro-sceptic', even (or perhaps especially) after having studied how it came about last year while I was looking at modern Europe.  But what I would like to point out before I throw my own two penneth into the ring of the debate, is that really, I'm not an economist or an economic historian.  I'm just offering some musings.

The Eurozone is a bit of a weird thing, really.  It's basically a band of countries saying 'we'll become one in currency, but not one in policy'.  Now, that's bound to cause problems.  Let's face it, we're having enough trouble in Britain dealing with the economic crisis (don't get me started on the Conservatives...), but while we're sort of four countries the countries have been largely united.  In Europe, it's different.  Whilst all the members of the Eurozone have to take the same knocks to the same currency, they don't have to respond to the crisis in the same way.  I dare say doing something utterly wrong but at least all the same would be better than everyone pulling in different directions.  The trouble is, through monetary union, the countries of the Eurozone have become one in practice, if not in fact.  It's a little like England and Scotland when James I came to the throne.  He couldn't get people to agree to a union, but he could drop trade barriers and deal with cross-border raiding.  So that's what he did.  And just over a hundred years  later, you end up with the Act of Union, incorporating Scotland and England together.

Whenever you look into how the EU has progressed (ie, from all the bazillion acronyms with E and usually one or two Cs, and perhaps one or two other letters, to a slightly different set of a bazillion acronyms), perhaps the most striking thing is how the EU has grown and developed.  From something which the Brits initially saw as a good way of making France and Germany never fight each other again, it's progressed to a sprawling empire of 'Eurocrats' and little real democracy.  But the roots remain.  Common Agricultural Policy, and the skewed balance of contributions from Germany (which was understandably keen to get involved in the first instance so that it was no longer a 'leper' country) still underlie the EU, together with disproportionate influence for France and Germany.  And what of poor Italy?  A founding member, arguably throwing a last desparate grasp at world power status, and now relegated somewhat to the sidelines, save for occaisional worried glances at the Italian economy and fearful noises being made.

The EU needs shaking up and refounding on a firmer, more democratic footing if it's going to make real progress into the future, and if people aren't going to remain sceptical.  Sure, there were elections to the EU Parliament, but when does that ever make the news?  The only thing that headlined for so far as I could see was that a couple of BNP members made it in.  And let's face it, that's gotta be a measure of how unseriously people take the thing.  If people had confidence in the institutions of the EU, we would be more willing to contribute to it, to allow for the fact that all member states are in this together.

That said, it will be pretty hard to dismember now that countries have switched to single currency.  What they going to do, dig up their old currencies?  Or have the same ones, but just differentiate based on area of issue?  That'd cause chaos and no mistake...

1 comment:

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