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2 July 2015

Leader: Europe’s battalion of woes

The European Union has indeed brought peace and prosperity, but now this hard-earned and long-cherished stability is fracturing.

By New Statesman

The aspiration to create a European confederation of like-minded liberal-democratic states was always utopian. After the ravages and mass slaughter of the two world wars, it was an existential necessity for the European nations to make a future that would be different from the past. Only the building of “a kind of United States of Europe”, Winston Churchill said in 1946, would save the continent from more misery.

The European Union has indeed brought peace and prosperity to the people of Europe, many of whom, until quite recently, lived under fascist or communist dictatorships. Europeans are today more free than they have ever been – free to travel, to trade, to live, to worship, to study and to work wherever they wish within an economic and social union of 28 nation states. But now this hard-earned and long-cherished stability is fracturing. The southern nations are struggling to cope with a migration crisis, as the poor and dispossessed of Africa and the Middle East seek refuge in Europe. Many of these migrants are fleeing the consequences of misguided western interventions, notably in Libya and Iraq, as well as civil war and tyranny. Those Little Englanders who wish to retreat from the world and slash our foreign aid budget fail to understand a fundamental truth of our globalised world, in which the population rises inexorably: that today, domestic and foreign policies have, in effect, become interchangeable or coterminous. Is the fight against Islamist terrorism, for instance, a domestic or an international issue? As witnessed in the massacre of British tourists in Tunisia, the answer is that it is both.

Elsewhere, the eastern European and Baltic states are menaced by a revanchist Russia that has annexed Crimea and is sponsoring a proxy war in eastern Ukraine. Because it has no common foreign policy or army, the EU is unable to respond effectively to Russian aggression. Vladimir Putin senses this weakness and, as a consequence, is emboldened.

Worse still, the eurozone crisis deepens with each passing week. The project to create a single currency has been undone by its own internal contradictions and structural flaws: the economic imbalances between the creditor and debtor nations are too great.

The austerity policies imposed on Greece by the s0-called Troika of the European Commission, the International Monetary Fund and the European Central Bank have impoverished millions and devastated that unhappy country’s welfare state. As Simon Wren-Lewis writes in this issue, only a minor share of the bailout money was ever fed into the Greek economy. The larger portion went to Greece’s previous creditors, who would have lost out had the country been left to default on its debts.

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At stake in this crisis is nothing less than Greek democracy: how much pain can be endured when it is being inflicted by transnational organisations over which the people have no democratic control? We shall know the answer soon enough.

Like all utopian projects, the eurozone was destined to fail from the beginning, which is why the United Kingdom was wise to stay clear of it. It has not brought prosperity and security to Greece – nor to Ireland, Portugal, Spain and Italy. Indeed, throughout Europe’s southern Mediterranean, it is the young in particular who have suffered most because of the sins of their fathers, who for too long operated a form of crony capitalism. Youth unemployment rates in these countries are: 53.2 per cent in Spain; 52.4 per cent in Greece; 42.7 per cent in Italy; and 34.7 per cent in Portugal.

Meanwhile, the UK, the second-largest economy in the EU, is preparing to hold an In/Out referendum. When sorrows come, they come not single spies, but in battalions.

Even if the immediate Greek crisis is resolved in the coming days, with a new bailout package agreed and “Grexit” avoided, the country’s financial difficulties and its troubled relations with other eurozone states will persist. Regardless of what happens, it seems as though the dream of continental solidarity and interdependence is coming to an end.

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