Towards A Good Samaritan World

Thursday, April 14, 2005

COULD THE EU BREAK UP?

Patrick Hynes, at AnkleBitingPundits, thinks so. Polls point to a French "no" to the constitution. Patrick also links to an article suggesting that the euro could fail. The article opines that:

The euro is only six years old, and its launch contradicted economic theory. Skeptics argued that currency union cannot work without political union because unified fiscal and macroeconomic policies are needed to complement a single monetary policy.


Now, I'm not sure I agree with that. The economic theorists had differences of opinion; myself, I was not convinced by the Euroskeptic arguments in this case, and I think a currency union combined with decentralized fiscal and macroeconomic policies is feasible.

But politically, the European project is philosophically misguided, out of touch with its people, and beset by economic sclerosis and long-term demographic decline. In this unpromising climate, the Europeans have abandoned traditional forms of legitimacy rooted in national sovereignty in favor of an experiment. While most of the hope and labor that has been invested in the European project could probably have been better spent, the experiment has done some good.

As Timothy Garton Ash points out here, the EU is now an "empire." As such it plays, to some extent, the beneficent "liberal empire" role that Niall Ferguson has advocated that America play. What the EU needs to do is stop wasting its strength pushing the integration project further, but at the same time try to hold onto most of what has been achieved to date. Is that what the defeat of the constitution would lead to? Or, as many have warned, is the EU like a bicycle, which needs to keep going forward to avoid falling down?

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