The threatened break-up of Europe is a multifaceted problem, and the management of it so far shows no evidence of improving the situation. A significant part of the problem arises from the ambivalence that exists about the European Union itself, and the struggle between nationalism and integrationalism. Capital transfers and integration are the price of unity, as we have seen already with the unification of Germany, and the original Marshall Plan. Nowadays, the austerity policies and the tight fiscal controls have had an opposite effect from their intention. They are driving a thick wedge between the nations, that neither promotes economic recovery, nor unity.
The paradigm that the peripheral fiscal crisis was all about wanton spending, and poor management is simplistic. Peripheral countries were exposed to the economic effects of low interest rates and tight inflation control, and were ill suited to survive the techtonic shift into a collectivised economy that was dominated by the centre. What happened to date is not solely the consequence of peripheral countries being wanton in their spending, nor of central countries being lacking in their support of the periphery. A lot of the problems are related directly to the unidimensional model of integration – monetary and not political, social or even cultural. I believe that the problems have been generated by lack of idealism, lack of motivation, an ill conceived currency, and poor political leadership since the crisis started.
The crisis in Europe is therefore not an economic crisis, but rather a political crisis. Without the will to centralise Europe, in a democratic, inclusive political union, rather than a Financial Union, then I do not believe the European Community can survive in its present form.
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Thanks for following my blog! Looks like I am gonna read a lot of your stuff too!
Thanks fabrizio, I’ll try and make it worthwhile!
Sure you will!