econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 20 February 2016

How The European Union Could Still Fall Apart

from The Conversation

-- this post authored by Ettore Recchi, Sciences Po

Some say the true capital of the EU is not Brussels, where the European Commission, Council and Parliament lie, but rather Frankfurt, the seat of the European Central Bank (ECB). After all, it is the ECB that has done most to overcome the severest threat to European integration. In the wake of the sovereign debt crisis, ECB president Mario Draghi's 2012 promise to do "whatever it takes" to rescue the euro is one of the most successful speeches ever made by a EU politician.

The ill-fated Paulskirche parliament, 1848. Jean Nicolas Ventadour

In Frankfurt, a short walk from the new ECB headquarters takes you to the Paulskirche. There, in 1848 an early parliament was elected by all the small sovereign states of the German-speaking world. It was an exciting moment, a forward-looking project towards a unified Germany. But the fire of enthusiasm was soon extinguished. The parliament lasted no more than a year, and in 1849 its representatives started to desert it until it was eventually disbanded.

For those who think that the inertia of six decades of European institution-building and legislation is sufficient to keep the EU project on track, there is a lesson to learn from Paulskirche: reneging on a grand project is always possible. Just like the first German parliament, the European Union can still fail.

Chain reaction

A chain of potentially disruptive political events looms in the EU's future. The most explosive is the UK's possible exit from the union. Neither the date of the referendum nor its outcome are decided at this stage, but it is entirely possible that British voters will opt out.

The people of the Netherlands will also be voting on the future of the EU, in April 2016. The country is holding a referendum on whether an association agreement should be offered to Ukraine. The result will be non-binding, but a No vote would still be a slap in the face to the EU grand plan.

The big test will be in 2017, an election year in the Netherlands (March), France (May) and Germany (September). Geert Wilders' gains in the Dutch parliament and gains made by the Front National could boost nationalist parties in Germany, which are already capitalising on the refugee crisis and the fallout from the mass sexual assaults of New Year's Eve.

Climate of uncertainty

In the meantime, the economic recovery is shaky and public debt still gigantic. It is possible that some peripheral states will face renewed financial troubles, not only in the south, where Portugal and Spain still suffer, but also in the east or even the north of the continent. Finland's economy, for example, is faring particularly poorly. If conditions get worse, radical leaders may be tempted to impose protectionist measures.

On the migration front, further inflows from Africa and the Middle East could bring about a restriction of the Schengen area to a core, continental "fortress Europe" that excludes southern and eastern states. Such a decision would not only dismantle one of the main engines of European integration, but also alienate the most exposed countries of the outer borders, such as Greece.

Let's call the whole thing off?

The irony here is that during any crisis, anti-EU parties grow stronger by collaborating across borders. Polish and Hungarian nationalist leaders are already supporting each other to be more and more defiant of EU rules.

Every setback for joint European decision-making will create an incentive to defect on mutual obligations. The tipping point could be reached if some member states refuse to contribute to the EU budget, or even withdraw their European parliament members.

At that stage, calling the whole thing off could be the easiest solution to the paralysing stalemates that would ensue. If not entirely scrapped, the EU could be downgraded and redesigned not as a political project but a regional economic pact (such as NAFTA or ASEAN) on a world map dominated by nation states.

People have the power

There are of course stabilising forces. Aside from the ECB, other banks and most of the European economic elite have much to lose from the unwinding of the EU.

The other underground driver of European integration is how deeply rooted it is in the everyday life of many Europeans. A recent study I worked on, revealed the complex social relations between a representative sample of citizens from six diverse EU member states.

Europeans are more integrated than they think. www.shutterstock.com

The study found that one in six respondents spent at least three consecutive months living in another EU country over their lifetime, and 51% had visited a foreign EU member state, for a short vacation, business trip or visit to friends and family, in the past two years.

EU citizens cross borders virtually (almost three-quarters of the sample), when they connect on the internet or on the phone with friends and kin abroad. And they increasingly engage in international economic transactions: more than 30% shop online or transfer money to another EU member state frequently.

Do the people of Europe realise that these bits and pieces of their social world are likely to wither if the EU disappears? Are they willing to trade them in for stronger nation states?

Sociologists are not fortune-tellers; our role is simply to envisage probable scenarios. The demise of the EU is one, and many clues suggest that it is more likely now than ever before. But for both EU supporters and detractors (authoritarians excluded), the good news is that even most extreme outcomes will happen democratically. If Europeans do call the whole thing off, it will be because people have the power.

The ConversationEttore Recchi, Professeur des universités (Observatoire Sociologique du Changement), Sciences Po

This article was originally published on The Conversation. Read the original article.

>>>>> Scroll down to view and make comments <<<<<<

Click here for Historical Opinion Post Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, using Livefyre just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.



You can also comment using Facebook directly using he comment block below.





Econintersect Opinion


search_box

Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.


Take a look at what is going on inside of Econintersect.com
Main Home
Analysis Blog
The Truth About Trade Agreements - and Why We Need Them
Big Mess in Italy
News Blog
Early Headlines: Asia Stocks Up, Oil Down, House Has Stopgap $ Bill, Trump Sold All Stock, Euro Holding On, May Doubles Down, India Economy Struggles, Oz GDP Contraction And More
President Trump Must Be One-Term, Voluntarily!
Documentary Of The Week: Untold History Of The United States, 1890s To 1920
Where MPs Stood On Brexit
How Accurate Are Final US Election Polls
Brexit In The Supreme Court - Here's What It All Means
The States Where It's Legal To Smoke Marijuana
What We Read Today 06 December 2016
This Truck's Barrier Expands Out Of The Back For A Quarter Mile
October 2016 Manufacturing New Orders Improved
3Q2016 (Final): Headline Productivity Improves
October 2016 Trade Data Mixed
October 2016 CoreLogic Home Prices Year-over-Year Growth Rate Now Improved to 6.7%.
Investing Blog
Exuberance Returns
Investing.com Technical Summary 07 December 2016
Opinion Blog
Trump And Modi: Birds Of The Same Feather, But With Different World Views
Oil Deal Won't Last Long
Precious Metals Blog
Silver Prices Rebounded Today: Where They Are Headed
Live Markets
06Dec2016 Market Close: Wall Street Closed Higher, Commodities Remain Weak, The Bull Marches On
Amazon Books & More






.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government



Crowdfunding ....






























 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2016 Econintersect LLC - all rights reserved