to emigration as the only alternative to poverty or starvation’. 4
On the political right, Nobel Prize-winning economist Milton Friedman also warned that the singlecurrency would ultimately cause major problems. ‘The euro was really adopted for political and not economic purposes, as a step towards the myth of the United States of Europe,’ Friedman declared in September 1997. ‘I believe its effect will be exactly the opposite.’ 5
Currency unions had risen and fallen in Europe in previous centuries, leaving abundant evidence that when problems arose in one
This study interprets and interrelates the major political, economic and security developments in Europe – including transatlantic relations – from the end of World War II up until the present time, and looks ahead to how the continent may evolve politically in the future. It weaves all the different strands of European events together into a single picture that gives the reader a deep understanding of the continent, and of its current and future challenges. The first chapters trace European reconstruction and political, economic and security developments – both in the East and in the West – leading up to the dissolution of the Soviet Union in 1991. Later chapters examine the European Union's reform efforts, enlargement, movement to a single currency and emerging security role; the political and economic changes in central and Eastern Europe, including Russia; the break up of Yugoslavia and the wars that ensued; and the North Atlantic Treaty Organisation (NATO)'s enlargement and search for a new mission. Final chapters deal with forces affecting Europe's future, such as terrorism, nationalism, religion, demographic trends and globalisation.
Cooperation and trust were increasingly scarce commodities in the inner councils
of the EU. This book explores why the boldest initiative in the sixty-year quest
to achieve a borderless Europe has exploded in the face of the EU. A close
examination of each stage of the EU financial emergency that offers evidence
that the European values that are supposed to provide solidarity within the
twenty eight-member EU in good times and bad are flimsy and thinly distributed.
The book aims to show that it is possible to view the difficulties of the EU as
rooted in much longer-term decision-making. It begins with an exploration of the
long-term preparations that were made to create a single currency encompassing a
large part of the European Union. The book then examines the different ways in
which the European Union seized the initiative from the European nation-state,
from the formation of the Coal and Steel Community to the Maastricht Treaty. It
focuses on the role of France and Germany in the EU. Difficulties that have
arisen for the EU as it has tried to foster a new European consciousness are
discussed next. The increasingly strained relationship between the EU and the
democratic process is also examined. The book discusses the evolution of the
crisis in the eurozone and the shortcomings which have impeded the EU from
bringing it under control. It ends with a portrait of a European Union in 2013
wracked by mutual suspicions.
implies that national governments would lose control over who would be
admitted to their territory. It also brings closer the concept that individuals
may be expected to owe a higher allegiance to Europe than to their nation of
birth or adoption.
THE EFFECTS OF THE SINGLECURRENCY
The development of the singlecurrency has, of course, been of great importance to the European project. However, it is no longer a live political issue. The
singlecurrency is here to stay for the time being and its successful introduction
in early 2002 confirms that there is little point in
talking about people with no jobs being ‘more flexible’. 5
One country, Germany, has risen to assume the leadership of the EU. Although currently it enjoys immunity from the pain of much of the rest of the eurozone, the future of the singlecurrency and perhaps of the wider Union itself seems largely to be in its hands. Currently, it insists that its economic model can be emulated by the deficit countries, wrongly believing that its plight at the turn of the century is comparable to the deep crisis many of them are facing. Thus, a morality tale has been preached year
character. Thus the singlecurrency was overtly designed to lock a newly united Germany into a common monetary union in which it would act in concert with countries possessing less powerful economies rather than dominate them outright.
However the post-1999 currency union is by far the costliest mistake in the history of the European integration process. It was the culmination of a growing tendency by central planners and Europhile politicians to take decisions over the heads of citizens, ones that benefited a small group of vested interests and had the potential to
How should power be shared among the governments of the member
states as represented in the Council of Ministers, the peoples of the
Union as represented in the European Parliament, and an appointed but
political bureaucracy, the Commission? How open and transparent
could the EU be, given the many sensitive issues it was now handling,
such as foreign policy, security and defence?
Rendering answers to these questions more urgent was the arrival, in
January 1999, of the Economic and Monetary Union and the singlecurrency, the euro, among eleven (and soon twelve) EU
The Party of European Socialists and the financial crisis
Michael Holmes and Simon Lightfoot
crisis not as a single phenomenon, but as a series
of closely interrelated crises, ranging from the initial banking crisis to a recessionary crisis and finally to the crisis that enveloped the singlecurrency. Therefore,
it should also be pointed out that the crises were played out at multiple levels: at
the level of individual national states, at the level of the European Union and at
a global level.
The chapter has two objectives. The first relates to theories of the development of Euro-parties. There are two broad strands in this literature. The first of
This chapter addresses the question, does the duty of economic reciprocity, as discussed in Chapter 1 , apply to the EU? If so, to what extent? I argue that claims of reciprocity in the EU are closely linked to the economic structure of the Union, which I discuss in terms of three main features: the common market, the singlecurrency, and freedom of movement. I argue that the patterns of specialization in the common market produced a “distributive vicious circle”, which prevents poorly performing states from improving their condition. This
We are clearly confronted with a tension within the system, the dilemma of being a monetary union and not a fully-fledged economic and political union. The tension has been there since the singlecurrency was created. However, the general public was not really made aware of it. 1
Herman von Rompuy, 26 May 2010
The President of the European Council delivered these remarks when the seriousness of the financial crisis that first revealed itself in Greece became evident across the rest of the eurozone. He was, no doubt reluctantly, drawing attention to