Friday, May 13, 2011

EU Systemics: A political union of the Scandic+Baltic countries or Benelux and other scenarios

1) According to the Eurostat publication Economic Statistics (Jan. 19, 2011), p. 32 of the document:

5 of the 27 EU member states (which also happen to be the 5 largest in terms of population ie Germany, UK, France, Italy and Spain) account for 71.7% of the 2009 EU GDP!

12 members account each between less than 5% and more than 1% of the EU 2009 GDP, for a combined 25.4%.

10 members each account for less than 1% of the EU 2009 GDP, for a combined 2.7%.

The last group includes some very small countries with pretty high GDP per capita such a Luxembourg and Cuprus.

2) The population of the 27 also varies considerably, as I showed in a recent post. 4 members have each more than 60 million inhabitants while 8 have each less than 5 million (3 of which less than 1 million). 9 have between 11 and 5 million inhabitants.

3) How do the above wide distributions of population and wealth (although GDP is not the most precise surrogate for wealth) affect the balance (or rather the lack of balance) in the EU (and the Eurozone)?

What can be done to make the EU and the Eurozone, as "systems", more stable?

a) Political Union. As I have proposed in many posts and tweets (see eg this recent post), IMO political union will help create better foundations for both the EU and the single currency, including better foiundations for the single market (because IMO a single market unlike a so called "free trade area" or the WTO "free trade" system, needs inter alia single/uniform laws and not only in the trade related field).

But what, other than political union (US or German style) of all or most of the EU members, improve the balance?

b) Would for example political unions of groups of the existing members help create a system with more balance,better systemics & thus dynamics?

In recent posts I did the exercise of taking a basic look at 2 such political unions, one between the so called "PIIGS" (Portugal, Ireland, Italy, Greece & Spain) and one between Greece, Portugal and Ireland.

Similar exercises could be done for:

1) Denmark, Sweden, Finland, Estonia, Lithuania and Latvia. Only 2 of the 6, Finland and Estonia, are members of the Eurozone. All of them, along with the UK, participated some weeks ago in a conference that proposed ways of growth for the EU, based on what was argued a common mentality of these countries/economies (eg pro trade, pro "free market", etc).

Also, the "Nordic model" was presented/"marketed" in this year's Davos WEF as a success model to be studied and maybe copied or adapted by other countries/economies!

So is there a foundation for a political union among these 6 countries or some of them? Feel free to send me comments to this blog post or to my @nppolicyanalyst Twitter account.

2) BENELUX was around even before the EEC (The 3 ECs were founded by the 3 BENELUX countries plus Germany, France & Italy after all). Could it evolve into a political union between those 3 countries of an approx. total of 26 million inhabitants? Maybe a topic for a future post. But again, feel free to send comments to this post or via Twitter.

3) Bulgaria and Romania could form a political union of approx. 30 million inhabitants, ie a bit less than the population of Poland.

4) The Czech Rep, Hungary, Slovakia, Austria and Slovenia could form a political union. Again, topic for another post/exercise on paper.

What would such sub-EU level political unions do, systemically speaking? They could provide a transitional phase towards an eventual political union of the whole EU (probably without the UK?). Plus they would reduce the number of members from 27 (which maybe is too large for the EU's dynamics?) to a number between

a) 9 members ie: Germany, France, UK, Poland, GIIPS (plus Malta & Cyprus?), "Benelux", Bulgaria+Romania, Scandic+Baltic, "Central"
b) 11 members ie: Germany, France, UK, Italy, Spain, Poland, GIPMC, Benelux, Bulgaria+Romania, Scandic+Baltic, Central.

That would mean 11 Commissioners instead of 27+ (think of future members), 11 Ministers in the Council of the EU instead of 27+, 11 heads of state/gov in the European Council.

In other words, remember the group dynamics in the EEC/EU decision making when it only had 9, as in 1973-1981, 10 (1981-1985) or 12 (1986-1994) members? That is what these mini or regional political unions within the EU would achieve. In theory at least.

The grouping in this food for thought exercise was based mainly on a geographical parameter. Among its problems is that some groups (Scandic+Baltic and Central) contain both Eurozone and non-Eurozone (or non-Europlus) members. Does geographical proximity provide the most potent "glue" for political union of countries?

If we look at people rather than countries, we notice that while neighbours or tenants of the same building may get along with one another, one's best friends usually are not his/her neighbours.
Eg would Ireland be more "comfortable" in a political union with the UK or with Portugal and Greece?

Would eg Greece be more "comfortable" in a political union with a) Italy or b) Bulgaria & Romania or c) Portugal and Spain or d) Portugal & Ireland?

While I think these exercises are interesting or intellectually stimulating, IMO the best option for political union is not for mini or regional one but for a full one (with of the 27 or a few less, eg 26 or 23). Because after all, I propose, it is easier for 27 families to co-habitate in one building than 2 or 6! Living in a small village or town can be somewhat suffocating compared to living in a city.
This concludes. for now, this intellectual - food for thought exercise on paper.

My point remains that political union is crucial and urgent (and un-avoidable) in the EU. especially when one considers the global systemics and dynamics of the era (this is the topic of a different post).

The EU needs a single polity and a single army and a single (federal) tax system, as well as sufficient "EU sovereignty" or independence or sufficiency in energy, staple foods, certain other basic goods the procurement of which cannot otherwise be guaranteed in the systemics and dynamics of the era (see eg the 2008 and 2011 world prices crises in oil and some staple foods).

PS. The above considerations do not necessarily reflect an "economic fortress EUrope" scenario (although IMO that is a scenario that is more probable or has more merit today than eg 1990 (consider eg the failure of the WTO Doha round)) but an ever uncertain world, further complicated by the whims of speculators in shares & bonds, commodities, etc.
In other words, from the city states of Ancient Greece (that never united unless to fight off invaders or by Alexander the Great but in the process of globalisating the then "known" world (look up "Hellenistic Times" or my 2008 post "Globalisation, today and in 300 BC")) to the utopia of a world government (with a world parliament etc, not a G20 type), IMO, the optimal systemics in the world (Earth) today are a key factor for a politically united EUrope.
Consider this: Had the city-states of Ancient Greece united into a United States or Fed Rep opf Germany type of union before or after the Peloponnesian War (instead of partial alliances such as the Athens Delian League and the Sparta led Peloponnesian League), then the history of the world 450 BC to 2011 would have been quite different.


  1. Kant presciently told of the inevitability of a global government back in his day in Königsberg. We live on a planet with ever dwindling resources and eventually those resources are going to have to be managed to avoid everyone killing each other over them. It is an inevitability even if most people today can't see the big picture.

    I believe the EU offers the best framework for that world government. Its not perfect, but it is in the right direction. There is no path back to the nation state. Anyone who believes that is, with all due respect, living in a fantasy land. The only way forward is together. To quote an American "if we don't all hang together, we shall all surely hang separately". That's what's missing in the current debate about European integration: solidarity. The idea of a sovereign state is lost in a globalized world. Instead we now are broken down to the lowest common denominator: sovereign citizens. These citizens deserve an EU that works for their benefit yet they are consistently hampered and lied to by their national governments, who tell them that they have their best interests at heart, a line they readily believe because the fear of the EU is played on by every member state government in Europe. Fear is a powerful tool to control people.

    Political integration of all current 27 member states and members yet to be anointed into the family will require grassroots movements who rally around the cause of European integration. I can't see it coming from the member state governments. It is inevitable and the longer it is put off, the more difficult cohabitation under one supranational roof will become. The question is how do you convince people of this necessity unless there is some big threat especially when the media plays to the fears of a united Europe? If we can tackle that question and resolve it, we can be on the way to what we need.

  2. Thank you for your thoughtful comments.

    re: "If we can tackle that question and resolve it, we can be on the way to what we need." Indeed.


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