Saturday, November 19, 2016

Does the EU make sense?

In past posts I have looked at the present and at the potential future of the EU. I have argued for a scenario in which the EU will evolve into a deeper union. Even pointed out that maybe the next EU Treaty should be "take it or leave (the EU)" But of course deepening is not the only scenario.

Another scenario is things remain pretty much the same. Will come to that. A third scenario is a move backwards. Let's look into that.

Why is there an EU in the firstplace? The three communities were created to help avert a new war in Europe. They succeeded in that.

The idea was that via co-operation in carbon and steel, nuclear and trade between European countries peace would be promoted.

But nowadays there is there is a free trade system (or a near free trade one to be precise) via the evolution of GATT, the WTO.

The EU Single Market provides the ease of common product standards which otherwise can be used as a trade barrier, but with WTO rules trade tariffs under 4%, is that such a big deal after all? Is the EU Single Market worth sacrificing national sovereignty and for German and Dutch taxpayers spending money on roads and bridges in Spain or Greece? If the Brexit and Trump phenomenon is indeed real and not exclusive to those countries then many are wondering the same in Germany (eg AfD), the Netherlands (PVV), France (Front National), etc. After all, Finland's biggest export markets are Russia, Sweden and the US and Germany's Angela Merkel has been smart to promote non EU exporting for Germany (and thus affecting the EU's trade policy, ie to be open, no fortress Europe).

Without the EU, each country will decide its own immigration policy (of course it may have to build more walls).

What about defense? The Russia factor? Well, if Trump indeed makes NATO less potent, European countries can always start an ETO (European Treaty Organisation), no need for a whole EU.

What about free movement? Of course, there will be much less of that. But that is exactly what many want. They want exports, they are willing to buy foreign products and services, they want foreign tourists but they do not want foreigners competing for the same jobs head-to-head. What if these jobs move en masse to Asia? That is what has been happening too and many voters are not happy about that either.

Have I just described Boris Johnson's wet dream?

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BRs
Nick

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