Is Brexit and indicator that the EU itself is just not workable?

[Berkut]

I've long thought that the EU was a great idea...if it could be something that could actually become a nation in and of itself. IE, a organization where the people in it, by and large, identify themselves more as members of that rather than members of their own individual countries, and can therefore tolerate what is often going to be "losing" regional decisions.


But it doesn't seem to me like the EU is anywhere near such a thing - and without it, the scope of it's possible influence is radically smaller than what is needed to actually achieve anything particularly useful. Because at the end of the day, political power is a zero sum game - any power the EU has has to come from its member states giving up some of their own, which means that fundamentally the EU must have sovereighnity over it's constituent members for it to be anything more than a glorified trade agreement.


I suspect that the British jumping ship fundamentally illustrates just this problem. The EU has tried, IMO, to have it both ways. It wants to be something more than a trade agreement, but at the same time leave actual sovereignty in the hands of its constituent members. I just do not see how that can work. It is, fundamentally, a half measure.

[Josquius]

It's an indication that it's PR department sucks.

[fromtia]

I think it's workable, desirable even. It can be viewed as a federalizing project and all the arguments involved in a process of that nature and scope need to take place, and it's getting a little messy apparently.

I think the really big problem with the EU, and of course there is a lot not to like, is that it is an unpopular bugbear with a lot of working people across Europe and as such can be rent asunder by the parties of the right who are not in favor of the project.

Brexit was formented by a wing of the British Conservative party. Ramsay Bolton Cameron thought he was going to settle their hash with a referendum. Wackiness ensued.

[Razgovory]

Way back when, before any of the recent crises, when all the Euros were euphoric I thought there some major problems resulting from a lack of central authority.  What keeps a big nation from abusing a smaller nation and what happens if someone tries to leave (at this time the EU didn't even have exit clause).  Government by treaty just doesn't seem like it will work in the long run.

[OttoVonBismarck]

The UK was a strange outlier in that it was the only large country that was always somewhat separate from the EU. It negotiated special status after in the early 90s as the Eurozone was forming, for example.

Now that Britain is gone the Eurozone and the EU are closer to being one and the same, with every state other than Denmark having signed an obligation to "eventually" enter the Eurozone. When you have a union of 27 (or 26) states that all use the same currency, you need a much tighter coordination of fiscal and broad economic policies for it to work, than we have had thus far. This means a further erosion of sovereignty--importantly there are supposed to be some broad guidelines for member states, like debt as a percentage of GDP and on deficit spending, that went unenforced and resulted in serious problems.

The current EU/Eurozone some countries benefit from the system dramatically more than others, look at Germany, which would have a much more "expensive" currency if it wasn't part of the Eurozone.

For this plan to turn the EU into a Federation, you need to get on with getting the rest of the EU into the Eurozone, and then you need to structure the Federation so there are more mechanisms to collect revenues at the Federation level and distribute benefits with more going to countries that need it more than those who do not. That's one reason Federal states like America are so strong--the poor states benefit immensely from the arrangement.

[OttoVonBismarck]

I think part of the issue too is the EU is so byzantine, I think very few ordinary citizens understand its workings, and can clearly delineate / explain the different organs of government. I think there's also confusion about "what is a benefit/cost of being in the EU, and what is actually the result of some other pan-European treaty that is separate from, but covers a largely coterminous area as the EU?" Who sets x regulation? What exactly does a member of the european parliament do?

I'm not exactly sure why it seems the people are so ignorant of this, but they frankly appear to be. I guess there are parallels to here in America, where many people cannot name the three branches of government, but I think at least a "decent" chunk of people can, if for no greater reason than High School civics classes.

How many EU citizens actually could draw this image on their own, and explain the different pieces:

EU Political Structure

[The Minsky Moment]

The EU is fine, but the Eurozone has unresolved structural problems.  A currency union covering strong central regions and weaker peripheral ones has to have mechanisms to get liquidity out to the periphery in times of crisis, and regular mechanisms to adjust for varying levels of competitiveness (because the deficit countries can't devalue).  The EZ doesn't have that and the last crisis was brutal.  Probably cant survive a repeat of that.

[Berkut]

But MInsky, that is what I mean - everything *could* be fine, it's not like the EU cannot do what they are trying to do...I just don't think they can do it in the manner they seem to be trying to do it.

The benefit to be gained from operating as a whole rather than 27 parts cannot be gained while still maintaining the 27 parts as autonomous units. You can have 27, or you can have 1, but you can't have both.

[MadImmortalMan]

They found lots of creative ways to get money to the periphery states.

I don't think it can be blamed on the EU as an idea, or even the EU's particular institutions as THE cause of it's own weakness. Surely they could be better, simpler, more democratic. But a lot of the things that have people so angry are causes external to that. ISIS, the Arab Spring, worldwide central banks suppressing rates for so long and likely a lot longer. The EU didn't specifically cause those things, it just isn't flexible enough to be able to handle them properly.

[Admiral Yi]

The EU is fine, but the Eurozone has unresolved structural problems.  A currency union covering strong central regions and weaker peripheral ones has to have mechanisms to get liquidity out to the periphery in times of crisis, and regular mechanisms to adjust for varying levels of competitiveness (because the deficit countries can't devalue).  The EZ doesn't have that and the last crisis was brutal.  Probably cant survive a repeat of that.

Change Basel II so that sovereigns aren't valued at par in capital.  That breaks the link between banking and deficit spending.

[Berkut]

They found lots of creative ways to get money to the periphery states.

I don't think it can be blamed on the EU as an idea, or even the EU's particular institutions as THE cause of it's own weakness. Surely they could be better, simpler, more democratic. But a lot of the things that have people so angry are causes external to that. ISIS, the Arab Spring, worldwide central banks suppressing rates for so long and likely a lot longer. The EU didn't specifically cause those things, it just isn't flexible enough to be able to handle them properly.

Indeed, and that is what I am getting at. They didn't create those problems, but they cannot react to them reasonably because they lack the political power to actually act as a union. And that is because France is not culturally or politically ready to have something like the Paris attacks happen, and then say "Hey EU, how are we going to respond to that?". Because it isn't actually a union at all, it is just a trade organization. And as such, when they try to do more than be a trade organization, they are inevitably going to step on toes and run up against the cultural reality that Brits are Brits first, Scots second (or vice versa) and "Europeans" a distant third, at best. Same with Germans and French.

The basic problem is that Europe wants something, but isn't interested or willing in giving up the sovereignty necessary to get it. They want to have the *power* of a united, 500 million person "country", but still be able to make the important decisions locally. You can have the first, but not the second.

I think things like Brexit are, to a degree, the reaction to the EU trying to be more than that trade federation when it runs up against the cultural reality that people who live in Europe are not really Europeans.

I would say maybe they need a nice Civil War to bring them together but...well, they've had enough wars. If it hasn't worked so far, it probably won't after another go around...

[alfred russel]

The eu and its predecessors have been operating almost since the end of wwii. It has expanded many times, and a number of countries are clamoring to get in. Since wwii, the eu members have experienced a run of economic growth and stability unprecedented in european history.

Not sure why we should question if it is workable because a very close plebicite in one country.

[mongers]

The Brexit result indicates the UK itself is just not workable.   

[Crazy_Ivan80]

I think the really big problem with the EU, and of course there is a lot not to like, is that it is an unpopular bugbear with a lot of working people across Europe and as such can be rent asunder by the parties of the right or the left who are not in favor of the project.

correct that for you as being pro-/contra- eu is not a left/right divide.

[Crazy_Ivan80]

The eu and its predecessors have been operating almost since the end of wwii. It has expanded many times, and a number of countries are clamoring to get in. Since wwii, the eu members have experienced a run of economic growth and stability unprecedented in european history.

Not sure why we should question if it is workable because a very close plebicite in one country.

A lot of that has been made possible because of NATO however. A reality far too many in the EU like to ignore. Which is one of the reasons why it was something of a disgrace that it was the EU that got that nobel-prize instead of NATO.