Britain and the EU

The recent brouhaha between Britain and the EU has revealed a lot, and exposed many things that have been simmering under the surface.

As we know the European Union has been desperately flopping around trying to find a solution to the crisis that is affecting the euro. Mainly at the insistence of Germany, the Merkozy duo have decided to update the treaty, which will essentially turn member state s budget control over to the European Union. Britain was willing to go along, but asked that some modifications be made to allow a certain degree of independence for British financial institutions. London is the biggest financial markets in Europe, the British are concerned-rightly in my opinion-that if they turn over financial control to the European Union, that the EU will use the new powers to hinder the success of British financial institutions. I think that this fear is not entirely unwarranted considering how much France would love nothing better than to hinder Great Britain, and the French have great influence within the European Union.

Anyway, Britain’s refusal to go along with changes in the treaty without modifications, has been taken as a mortal offense on the part of the European Union. All the old resentments have come roaring up to the surface, no doubt egged on by France which loves nothing better than to isolate and marginalize their old nemesis, the United Kingdom. There has been dark vindictive talk recently about Britain being intentionally left out of decisions, essentially becoming a non-member member of the European Union.

This of course has only confirmed for the British their worst fears and resentments about the bad intentions of the European Union, and especially France towards them. Many Britons feel that they have been good members for decades, and once they come up with a few objections, suddenly everybody rejects them. What is even more upsetting is that France has been shamelessly playing selfish games for decades, and getting away with it Scott free, but the minute Britain looks out for its own interests it is considered to be unacceptable, and is turned into a pariah. The latest incident also confirms for many British people the feeling that they will never be fully accepted as complete members of the European Union, and that France will always use its considerable influence to keep Britain marginalized.

I have to say that I tend to agree with them. Certainly seems that France is able to get away with acting badly, but the minute the Britain stands up for itself, it is immediately castigated. No matter what Britain does, France will always be there to badmouth and block Britain, and do so generally quite successfully. They’re those who believe that if Britain had joined the Euro it would have more influence today, but I’m not sure that is true at all with France using his considerable influence to constantly marginalize Britain. The reality is that Britain has been a member for decades, it is one of the three big economic powers in Europe, and yet it has very little power. Its population and economic weight are about the same as France, and yet France exercises much much more power and influence within the European Union. It also appears that Britain’s skepticism towards the European Union drives the European Union crazy.

I think that this crisis has made even more British people revaluate whether they really even should stay within the European Union. It seems that the EU is more than happy to push it aside, and I think many in Britain would be happy to leave the whole mess. One could rationally surmise that in total the European Union is negative to Britain, since Britain has to pay a lot of money into the EU (much more than it gets back), and to be subject to it’s rules and regulations, while at the same time having very little to no influence in determining how that money is spent, and how those rules are decided imposed.

Certainly Switzerland and Norway, which are not members of the European Union are doing just fine, and, they have been able to acquire open trade treaties with the rest of the European Union. Most of the current conflict stems from a difference in perceptions about what the Union should be. The elite in Europe treat the European Union almost as a holy article of faith. The union must be saved at all costs, and there is only one way forward which is ever greater union. Britain, in contrast, never really wanted anything more than to have free trade with Europe. They are suspicious and uninterested in forming some kind of fiscal and political union. Britain’s lack of true faith towards the project is treated with irritation in the rest of Europe.

Therefore, I think it might be best for everyone if Britain left the European Union, and formed a free-trade agreement with it. That way Britain would be happy, and I think the rest of the European Union would too. I really do not see why everyone in Europe is supposed to fit a one size fits all program. It certainly seems to me that different countries should have the ability to decide at what speed or depth they want to join the European project. And, for those who are not part of the one true religion of ever greater European Union, they should not be treated ldecently. I think that if we all can find a plan that fits different countries, they will all get along much better. It’s a one-size-fits-all mentality that tends to create the greatest amount of friction.

Anyway, a couple of days after the whole kerfuffle, Merkel realized that if the European Union pushes too hard, Britain may just end up leaving the European Union. While I’m sure that that would please France, Germany knows that it’s not in their interest to do so, mainly because Britain is a net contributor to the European Union’s budget, but also because it is appreciated as a counterweight to France, and a champion for free trade and liberal markets. If Britain is out of the way, France will have even more of an opportunity to impose its will upon the European Union, and Germany knows that this is not good for anyone but France. So, Merkel a couple of days later made a statement saying that Britain is a valued and important member of the European Union, in an effort to soothe nerves and resentments, especially on the British side.

Nonetheless the damage has been done, and it will be interesting to see how the British react in the next few years, and if they want to continue or if they want to try to leave the European Union.

I suspect that a lot of the anger and resentment towards Britain from the continent comes from a deep sense of frustration and embarrassment that their cherished project, the euro, is in such trouble. So, instead of admitting that they set the whole thing up based on unrealistically optimistic thinking, they decide to beat up on Britain as a kind of scapegoat for their collective frustrations. I think that there is a lot of stubborn hurt pride involved in this, and Britain’s refusal to join the euro, and it’s amusement at seeing the euro flounder (I told you so), touches a deep nerve of anger within the European Union. Frankly, Britain is an easy target to beat up on. They would not dare do it with France, which has a long history of acting badly and selfishly with impunity.

Another point that has been exposed in this euro crisis is a lack of effective Democratic institutions to deal with problems. Instead, it seems that every unexpected difficulty is treated in an ad hoc political manner, usually with France and Germany getting together and coming to a political decision, which the rest of the European Union is supposed to unilaterally accept. How is his Democratic with only two nations, out of more than 20, making the decisions for everyone else? It would be as if California and New York got together and decided what the entire United States should do. Sooner or later if the European Union wants to be democratic it is going to have to put in place a democratic system to make decisions.

Of course, France has been able to get it’s way and make sure that the decision-making process about how to deal with countries budgets will not be done in a transparent and objective way, but will be decided by political horse trading as if they were in some kind of Arab bazaar. Of course this is an open invitation to all kinds of abuse, especially by France. It seemed that the European Union has become an organization, in which a few powerful members are able to make most of the decisions for everyone else. This is not democratic. Furthermore, with all this political wheeling and dealing going on I see it is very difficult that the European Union will be able to impose any kind of fair and systematic budget discipline on its member states. I can rapidly see the whole process devolving into a mess of political wrangling and resentment. Let us not forget that the Maastrict budget limitations fell apart within a few years after signing of the treaty, because France and Germany decided that they no longer wished to follow the very Treaty that they had signed. So they flouted the law, and once they did so they set a precedent that every other country in the union could also flout the law. And they did as well. How is his new treaty necessarily going to be any different than the last? These are some serious issues that need to be worked out.

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