EU: Three Levels of Failure

The European Union has failed to halt the debt crisis that has taken hold of the country’s political, economic, and social situation.  With such circumstances only growing worse, without any foreseeable end in sight, the credibility and soft power of the continent has been severely damaged.

The European Union is a unique economic and political partnership between 27 European countries.  As an international system, its purpose is to safeguard the sovereignty and security of its members.  So saying, the EU has been able to deliver half a century of peace, stability and prosperity, helped raise living standards, launched a single European currency and is aimed at progressively creating a single Europe-wide market in which all people, goods,and services can move among Member States in a free market.  Very idealistic but somewhat reasonable and noble goal that has gone wrong at some juncture.

The stability of the European Union should be a rather strong guarantee because of the ties between the Member States.  The stronger the normative and institutional the normative and institutional threads binding states, and the denser the connections between them, the greater the stake states have in preventing system breakdown.  This union, a common alliance, also creates more avenues in which the countries have available to them for resolving disagreements before they get out of hand.  Clearly, the conditions of today illustrate that the problems have gotten out of hand.  The fault does not lie at a single source, though many have taken precise aim at Greece; rather, the problems of the European society lie on an individual, state, and general system level.

The individual level can be associated with the decisions made and being made by the respective leaders of countries such as Greece, Portugal, and Ireland which were the precursors for the growing crisis.  Political leaders have a natural motivational psychology to desire power and therefore, fear any situation that may cost them any amount of public support and this power.  This illustrates the vanity that lies deeply rooted within any person too. So, leaders such as George Papandereou, used the assets available to them from the European Central Bank to raise the borrowing ability of Greece.  Using these resources, Greece was able to raise its living standards, practice much more liberal entitlement programs and welfare programs to a much more liberal extreme.  Throughout Europe, the influence of people brought on a similar age of gilded society.  The politicians were able to surmount a large level of support because of their actions in favor of the people, but underlining the exterior of society lay a deeply corrupted infrastructure.  The infrastructure was plagued by tax evasion, unrestrained spending, and cheap lending. The problems began to exact a large toll on the banks which, being connected to a larger scale of European banks, led to the widespread problems.

Nevertheless, the onset of the problem was sparked by irresponsible actions by those leaders, but the events have not been corrected because of the other individual leaders.   Leaders of the euro-zone, such as Chancellor Merkel and President Sarkozy, have not been able to appropriately deal with the significant growth of this problem.  Much of their reforms have been limited to large relief packages to some of the so-called “PIIGS”(Portugal, Ireland, Italy, Greece, and Spain).  Admittedly, Chancellor Merkel insisted that the relief packages be given only on the promise of strict restrictions and austerity cuts.  Nonetheless, the German chancellor did not remain vigilant on the implementation of such cuts and the problem has only continued to get worse.  Merkel and Sarkozy did hold a meeting that has called for the creation of a Euro-zone council which would serve as a tool to implement increased pressure on the Member States to improve their fiscal discipline, but as mentioned in “EU: Sarkozy-Merkel Meeting“, these conditions have existed in previous EU legislation. The failure exists in the system and the enforcement of such legislation, which will be mentioned later in the system level of failure in the EU.

However, the extent to which the blame can be focused on the individual level is complicated due to the state institution which in a democracy, stresses the sovereignty of the people.  In a democracy the people hold sovereignty and delegate government to their elected representatives and other state officials.  Therefore, these people serve as a tool of influence that coerce the moves of the individual leaders.  The machinery of the government leads to the state’s failure to cope with the consequences of its actions.  Once combined with the organizational dynamics of the system on a whole, the levels of significance become complicated.  The leaders, the individual level, are victim to vanity and crave power; therefore, they adhere to the popular will.  This will called for social spending in the form of investment in entitlement programs and welfare, as mentioned above.  This has led to the complications on the system level, the obvious fiscal crisis of the European Union.  So, the individual leaders must cope with the popular will and their duty to uphold the European bloc,two different levels of the institutions.

To be more direct on the failures of the state institutions, the amount being given to these bailout packages have left the “bailers” as beleaguered states, left with few resources and tools to cope with stagnation, high-unemployment, populist politics, and social instability.  Evidence of this is the widespread instability in London, Greece, and most notable is Norway (read more at The Fall of Europe).

In conjunction, a large amount of the problems exist in the specific organization, and lack of true union, in the system of the European Union.  As mentioned in “The Broken Euro”, the European Union does not fall along the lines of its stated goals, nor does it represent a true union.  There does exist a strong transnational link between all the states involved but this link seems to only allow the problems of one state to affect the others.  This reflects its resemblance of the Hobbesian state of nature, in which the system is a billiards table and the states are the billiards ball.  Once one state comes into contact with another, the balls come into conflict with all of its neighbors, creating a cycle of conflicts.  This transnational link does not allow the “meddling” of one leader, or great power, to reform and restrict the actions of its fellows.  This is because of the controversy over sovereignty of the Member States.  Sovereignty has led to the main problem of the EU, in that there exists an inability to enforce policies and reformation across the state borders.  The states involved are selfish in that they will not cede a fragment of their power to a European Finance Ministry.  An across-borders ministry as such would be able to manage the debt, the inflation, and the overall growth of a true cohesive body, a true European Union.   The EU has not delegated enough of their communal power towards investment into such a Euro-wide baking regulatory system, a centralized institution.  They must subordinate some of their individual sovereignty for the common good.

Much of the reform is at the feet of the European Central Bank.  Lately, the ECB has begun buying the debt of Italy and Spain to hopefully halt the degradation of their political, social, and financial stability to the level of Greece.  The problem with buying the debt is that it does not force reform or financial restrictions upon the countries; rather, it does allow them to lax in their cuts because the ECB will “always” be there to buy them from catastrophe. What needs to be done, is the creation of the Euro-wide ministry but also the stability fund, known as the European Financial Stability Fund, must be increased in size.  This will allow it to become a transnational fiscal authority.  This fund would be able to serve as an emergency relief for certain countries and once these countries have been helped, the concept of the Eurobonds may be dealt with.  Much popular-will has been delegated to such bonds.  Therefore, the organization reforms will fulfill the duty of the leaders towards the EU and the emergence from the crisis and the creation of the Eurobonds should be able to suffice to appease the growing tensions of society and popular will.

In retrospect, the level of failure have led to the loss of credibility both for the general organization, the individual leaders and states involved.  Leaders such as Chancellor Merkel, the most powerful women in the world according to Forbes, has lost much of her power and credibility in Germany and the CDU. President Sarkozy is also attacked by rivals and former allies in the political system in France, and with election nearing, he may soon face the all too real risk of losing reelection.  The problems also exist in the state level as the economic growth in Germany has slowed due to its involvement in the European Union and France is at risk of losing its AAA rating.  The power of the European continent has been severely weakened and does not exist all together in some countries.  The ability of these countries to present a formidable military and financial force in the world and therefore able to coerce other countries to align their interests with theirs (known as “soft power”) has been belittled.  The damage to their credibility needs not be explained as the downgrades and threats by credit rating agencies is all the evidence that is needed.

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2 responses to “EU: Three Levels of Failure

    • Hey, I believe that the intended purpose and mission of the EU is valuable and noteworthy. The execution is rather lacking but this is the problem is on the state level.
      There is a fear of interdependence, more so than already exists, and a fear of anarchy in that the individual states do not wish to be answerable to an higher authority.
      Nevertheless, the European Union should exist as a political, social, and financial community for the EU. There should be no worries concerning the management of the various councils as these councils should be an effective representation of all members. It should serve as a democratic entity in that there will be equal representation of states, enforcement through a common defense that will be supplied by all members, and well…in should be a European UNION. It is hard to make that point clear, apparently.
      There will not exist a perfectly balanced and effective community but the members can join together to create a better union, a more perfect union then what currently exists.

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