I'm not sure how much realistically. The EU is now pretty much split into two factions, those in the euro and the rest. The ones in the euro are too busy trying to sort out that unholy mess to give a a flying what the rest think and the rest are too busy trying to stop the rot spreading to their own economies to produce anything coherent to take advantage of the situation.

It's quite hard to get consensus on which direction to walk when you're all stood in a minefield.

The EU right now is getting pretty much next to nothing done and that will continue until the Euro countries have stabilised.

Well even if we had one single party from the uk we would still need support from other nations to get things done.


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If they were capable of consolidating themselves into such a small number of factions, they would actually be close to sorting out their mess. The reality seems to be that there are many more than that. Take the issue of free trade and open markets, where somehow Britain has recently been allied with Italy against Germany and France, even though Germany is allied with us against France and Italy on some parts of that same issue. If we quantified it fully, there would probably be more factions than there are member states.

The Eurosceptics and the Fedaralists have basically both been right all along*. The EU is a giant conglomerate of mission creep, constantly adding powers to itself through blunt accretion. Nobody has ever really looked at what it is for, and how it should be empowered for whatever that purpose is. That's how they ended up with the Euro mess they have now. That sort of thing was foreseen, economists did say which institutions would be required to keep it all together, but politicians didn't have the nerve to put the case for providing those capabilities for fear of French and German voters.

Had they made an honest case and done a proper job, the Euro would either have been fine now, or else smothered at birth. The Euro isn't a bad idea as such, but if it is not going to be fixed soon it would probably be better to break it up and start again from a more rational design towards a coherent purpose. The same may eventually have to be said of the EU.




* which is a shame for me because I always thought that both collectives were idiots.

I do think that the problems in the Euro are two fold, first and biggest of all is the banks. These have destroyed Ireland and Spain, and to some extent Greece. The second problem is one of fiscal transfers which the Germans do not want to face. They are unwilling to have regular transfers to the weak economies, to allow them to adjust.

Poor design of a system such that it has no capability to cope with any problem at all is the root. It was envisioned to provide no bailouts, offer no mutualisation, and provide no lender of last resort. And more specifically, all those essential things are banned under treaty. As is any form of subsidy from strong economies to weak ones.

The particular events that caused a crisis of confidence may well include banks, but loose monetary policy for the sake of Germany's interests that filled the weaker economies with too much credit on overly easy terms is part of that too. As is the fact that all that loose money allowed weak an uncompetitive economies to get by even with declining productivity relative to Germany. Ultimately, the countries who are in trouble now are the ones with [LIFTED] productivity levels and high malinvestment rates - not just in residential property, borrowing billions to build airports in the middle of nowhere, ploughing huge sums of public money into bankrupt companies that still have little chance of success and so on.

Now they have had problems for years, and the Germans Finns etc have been saying with some justification that giving them money for relief is subject to them addressing those competitiveness problems. But the EU has no moral authority, and no way to direct desperately needed reform other than withholding desperately needed funding, which is counterproductive.

And still, they haven't bothered to take stock and come up with a plan that can be taken seriously. Which again, is not a criticism only of the Euro, it applies across the board.