The Evolution of the European Union

If you’re interested in the history of the development of the various institutions that comprise the apparat of the European Union, by all means read this piece by Perry Anderson at the London Review of Books. Here’s a snippet:

The Union, as we know it today, is a complex composed of five principal institutions: the European Commission, the European Court of Justice, the European Parliament, the European Council and the European Central Bank. A consideration of these can begin with the term conventionally encompassing the story of their development, ‘European integration’. This came from America, as Patel has shown, and was adopted to avoid another term too pointed for tactical purposes in the politics of the 1950s. The word it replaced was ‘federation’, rejected by governments and what interested opinion then existed, if ardently espoused by a small but committed minority of activists. For them and their academic sympathisers, ‘integration’ supplied a more neutral term for progress towards an ideal best kept, for time being, in petto.

If you’re not interested in such minutiae, you’ll find it mind-numbingly dull, so I’ll provide a dissenting view. The purpose of the various institutions of the EU is to provide congenial berths for bureaucrats and the European Union itself and most especially the euro are actually stalking horses for the Germanization of the Continent. It’s the continuation of war by other means. Here’s a telling passage from the piece:

For Claus Offe, on the left, it is clear that ‘the euro has rendered European democratic capitalism more capitalistic and less democratic,’ disembedding financial markets from states and exposing states to their vicissitudes, in a system that Offe judges no more favourably, if for opposite reasons, than Bolkestein. ‘The euro under the ECB’s regime over-generalises monetary policy across widely diverging economies and their given position in the business cycle. Instead of “one size fits all” we are left with a situation where “one size fits none” due to the institutional incapacity of monetary policy to respond to the specifics of countries and their situations.’ No sooner has he casually said this, however, than he soberly retracts it. For there is one country of which this judgment does not hold: his own. Given the huge advantages that Germany derives from the euro, Offe writes,

any conceivable German government will do everything in its power to keep the common currency intact by avoiding the default of any member of the Euro club. For this currency allows the German government to live in an ideal world where pleasure is not followed by regret, meaning that an export surplus is not followed, and its continuation thus limited, by the appreciation of the currency of the country.

Matters are otherwise, of course, on the receiving end of such appreciation. The Southern and Eastern belt of states are paying the price of a misconceived currency union that cannot now be reversed. Even if ‘the introduction of the euro into a fundamentally flawed currency zone was a huge mistake, the same applies by now simply to undoing that mistake,’ since the dissolution of the Eurozone would be ‘equivalent to a tsunami of economic as well as political regression’. Hence the ‘trap’ Europe is in – it can neither move forwards, nor backwards.

The problems of Southern and Eastern Europe and not, as the Germans would have it, that its people are lazy wastrels but that it is drastically undercapitalized. Greece, in particular, continues to suffer the consequences of centuries of Ottoman control. That can’t be solved by selling them German goods but it can be solved by German investment in those countries. That’s what would have happened without the euro. Given the euro, it’s politically impossible in Germany.