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Why The EU Is A Good Thing - By Kitty Miv, Editor

Kitty Miv, Editor
13 October, 2011

There is going to be Greece, this week, but not yet! You can't have a rational view of what is happening in that beknighted archipelago without a clear understanding of the EU, and in the midst of all the easy criticism both of individual member states and the cack-handed behaviour of the Union's paralyzed movers and shakers, people are tending to forget why the EU is a Good Thing.

Coming from a confirmed eurosceptic (me!) this may seem perverse; but there was never anything wrong with the concept of the EU, or its core principles of people's freedoms, which are as powerful and right as America's Constitution. It's the execution that is wrong; not the plan.

This week has seen perfect examples of both good EU planning and bad execution. The extensive consumer rights directive published this week is a common-sensical response to proliferating electronic markets which are making a reality of the single economic space more quickly than individual nations can respond to it, and will prevent the erection of nationalistic (protectionist) barriers. Assuming of course that it gets enacted in something like its pristine form.

The single market is the EU's single greatest achievement, unless you want to hand that palm to the pax europa which has avoided any but minor wars in the continent for the last 50 years. Long term, it will be the creation of a more-or-less harmonious cultural space, unimaginable without the single market, which ensures the continuation of peace, but we shouldn't belittle the achievement so far.

The single market itself was the creation of a dedicated, one could almost say fanatical bunch of Europeans who put their dream above national aspirations. Perhaps they and their dreams were possible only because they had lived the horrors of war and its consequences; but where are they now when they are needed?

The current leaders of Europe are all but invisible. They are good people, no doubt, trying hard and enduring sleepless nights, but the steam has gone out of the dream.

What would Jacques Delors have said to an American Treasury Secretary who came to advise him publicly on how to reorganize the Union?

No, the show is being orchestrated by national leaders. It is Messrs Sarkozy and Merkel who are organizing the next stage of the Greek drama (see, we got back there eventually), agreeing to agree on a revised bail-out plan 'by the end of the month'. Like all politicians, they are driven by domestic electoral considerations first and foremost, and in fact are widely supposed to be far from agreement on what the next stage might be for Greece. Meanwhile the 'troika' half promises another tranche of bail-out funds, Greek ministers continue bravely to promise the undeliverable, and Slovakia, one of the smallest countries in the Union, votes against the expansion of the EFSF. Needless to say, it was probably done for domestic political advantage, rather than out of principle.

How sad! Where has the vision gone of 'ever closer union'? Today the EU's leaders see events as a threat, while they should be seeing them as an opportunity: the chance to create a robust eurozone fiscal regime, which has been walked all over by successive member states ever since Maastricht established a clear set of rules.

Your tame eurosceptic says that the time has now come to bite the bullet of European fiscal union; the alternative has become the gradual destruction of the Mediterranean littoral economies, with Italy, Spain and Portugal following Greece into an unsustainable debt trap, and probably out of the eurozone.

So why can't they see it, the high and mighty representatives of the Union? And if they can see it, why don't they do something about it, instead of waiting for the orders from their political masters and mistresses which will never come?

Ciao, Kitty


About the Author

Kitty Miv, Editor

Kitty was born in Argentina in 1960 to a Scottish cattle rancher and his Argentine wife. Educated in Edinburgh and at Princeton, Kitty worked for the World Bank as an economist, where she met and married an emigre Iranian banker. During her time with the Bank, Kitty worked in a number of emerging markets, including a spell in the ex-USSR as a Transition Economies Team Leader. Kitty is now a consultant in Brussels and has free-lance writing relationships with a number of prominent economic publications. kitty@lowtax.net


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