The political and economic discord resonating across Europe makes regional integration, in the form of the EU or the eurozone, completely unworkable. Nevertheless these ill-thought out unions are carrying on regardless, threatening to do more harm than good.
The EU is ungovernable and reform is practically impossible. The fact that in May's European parliamentary elections, anti-EU or extremist parties took 25% of the vote will not translate into any deep and meaningful change. For a start it is not clear what that change should be, since the various winning parties have completely different ideas – left-wing parties in Spain and Greece are opposed to austerity, right-wing parties in the UK and France reject the EU altogether. Then there is the challenge of how a bloc consisting of 28 countries at vastly different stages of economic and political development could ever be run either efficiently or democratically.
The fundamental principle of democracy is that the electorate can dismiss a government they don’t like and replace it with one they do like. Under the current structure, they can hardly do the former (the European parliament is only a co-legislator with the Council of Europe), while the rainbow of political parties represented means that elections just swap one hazy set of coalitions with another.
This is the ideal breeding ground for the eurocrat – a career civil servant or commissioner who sees the European project as an end itself, a vehicle for perpetuating the administration without due regard to how much it costs versus how much it benefits. Witness the row over holding EU budgets steady even in times of savage spending cuts at national level.
The EU administration is now so large that it represents a power bloc in its own right, and with such poor oversight by politicians – many of whom are appointed rather than elected – it is more or less free to pursue its own agenda. Whenever any of these senior officials is interviewed about unpopular EU policies, they declare that the electorate (unlike the eurocrat) does not really understand the issues – a sort of ‘let them eat cake’ approach.
Then there is the question of the eurozone, which breaks a fundamental economic principle – a common monetary policy will cause huge economic distortions and is not viable without economic convergence and a common fiscal policy. Clearly the EU administration did not appreciate this point and the result was a mega crisis, over which the eurozone architects have shown a distinct lack of remorse. The question is: where does the eurozone go from here? Economic logic dictates that the eurozone countries further integrate their fiscal and tax policies and create a banking union – as they are so doing. Hence, the policies required to save the eurozone are the exact opposite of those required for more national sovereignty as desired by the anti-EU political parties.
Maybe the EU will come up with some kind of sop on immigration, although this will risk alienating eastern Europe as much as it soothes northern Europe. Interesting indeed that former French president Nicolas Sarkozy’s response to the EU crisis was to call for the visa-free Schengen Area to be suspended – a rather predictable call from a centre-right politician under siege from the anti-immigration hard right. When Mr Sarkozy calls for reform of the common agricultural policy – a system of farm subsidies which eats up 40% of the EU budget and of which France is a leading beneficiary – we will know that real change is afoot.
Until then, the EU will carry on much as it always has done with the best hope being that positive trade measures – such as a Transatlantic Free Trade Agreement – will outweigh the costs of running Brussels as well as the system of misdirected grants and subsidies.
