The European Union did not begin, as many seem to think, as a diplomatic coalition of European states. Instead, the formation of the European Union was a practical financial decision, born from the changing face of the world after the end of the Cold War (Majone). The European Union is home to a wide variety of different people with different cultures; the purpose of the formation of the Union was not to homogenize the continent, but to form a coalition of independent states that worked together to counterbalance American economic and financial power, as well as the rising economic power of China (Dinan).
Although the European Union as a concept was many years in the making, the current European Union was formed in 1993 with the Maastricht Treaty (Majone). This treaty, originally called the Treaty on European Union, had two major, far-reaching effects for the participating nations. First, it established the basis for the euro, the current currency in circulation in much of Europe (Cia.gov). Next, it formed what are now known as the three pillars of the European Union: the European Community pillar, the Justice and Home Affairs pillar, and the Common Foreign and Security Policy pillar. Although the 1999 Treaty of Lisbon merged these three pillars into one concept, the fundamental structures of the pillars remain. Understanding the use of the euro and the functions of the different pillars is very important when analyzing potential futures for the European Union.
The first “pillar” of the European Union is the European Community pillar. This institution is actually much older than the European Union itself; it is an economic coalition of large companies and services that have existed since the early twentieth century (Dinan). The function of the European Community, despite its long and fractured history, has always been the same: to create a common market for Europe, where European nations can conduct business on equal footing with a minimum amount of bureaucratic nonsense and red tape (Dinan). Essentially, this pillar formed an economic framework for the European Union: it created a common market for Europe, where tariffs and taxes were standardized, and also set forth a series of standard business, agriculture, transport, and trade practices for participating nation-states (Dinan).
The second and third pillars of the European Union have shorter histories than the first. The Justice and Home Affairs pillar was concerned with immigration, emigration, and all issues concerning member states and their borders; the Common Foreign Service and Security Policy pillar functioned to handle diplomacy issues for the EU and its participating states (Dinan).
After the Treaty of Lisbon in 1999, these three pillars were abolished, and integrated into one larger policy regarding the participating states in the European Union (State.gov). The fundamental linking factor within the European Union is a common currency; indeed, the United States’ Central Intelligence Agency lists twenty-three official languages for the European Union, with a population of more than 500 million people (Cia.gov). This kind of social and cultural mosaic can be difficult to govern, because different cultures value different things from government structures.
The European Union, then, rather than being a powerful federal structure like the American federal government, is a looser type of government; states retain their autonomy in their affairs, but still participate in a strong financial and trade union with other states in their geographical area.
The European Union is not without challenges, however. The current economic and financial state of the world has affected Europe as well; Greece, for instance, has become a growing financial burden on the European Union (Horn). Because Greece is one of the member states within the European Union, it is guaranteed the support of the EU in times of financial hardship. However, Greece’s financial hardship is far worse than anyone in the EU foresaw when creating the economic union; although the European Union and the International Monetary Fund have repeatedly participated in loan and bailout plans with Greece, their patience with the country and its financial problems seem to be wearing thin (Horn).
The financial burden that Greece has placed on the European Union has caused some rifts within the coalition. Because Greece has been so unstable and job creation has been so poor, there are vast amounts of people moving about within the European Union today (Cia.gov). Because of the political format of the European Union, anyone holding a passport for any of the participant nations can move freely about within any of the other participating nations, for work, school, or travel.
According to Henry Farrell, an expert on the European Union, “In the long-run, the cherished right of free movement of people within the EU may come into question as resurgent nation states reclaim the right to control their borders and to bestow the benefits of citizenship. The Commission likes to talk about ‘European solutions’. Now it needs to find one” (Horn). Farrell is suggesting that the current structure of the European Union is problematic because it is taking too much sovereignty away from individual nation-states, which was not the purpose of the European Union upon its inception. There are policies that the European Union enacts that the participant nations sometimes dislike, and they have very little recourse as a result of the political and economic structure of the coalition. If one nation within the European Union financially fails, then it is likely that the entire Union will suffer (or perhaps even fail if the economic meltdown is large enough), which makes each nation in the Union financially responsible for all the others.
What does the future for the European Union look like? There are certainly problems that exist within the financial and political structures of the coalition, but the main problem that the European Union will have to face is the question of how much power participant states will cede to the Union. It seems unlikely that the participant states will be willing to transition to a United-States-like federal government system, but it seems equally unlikely that the participant states will be willing to continue to bail out failing nations like Greece and Italy.
The question of participant-state autonomy versus the power ceded to the European Union will become a more important question as time goes on, particularly as the strength of the euro continues to fall. As China becomes more powerful, European nations will be seeking financial stability with more fervor; to do this, they will almost certainly look for more autonomy in controlling their country’s financial decisions and immigration policies.
It will be interesting to see whether the economic coalition that make up the European Union remains strong throughout the coming years, and if it does, what the policy on member-state bailouts becomes. Greece and Italy have both posed large problems for the European Union, and the EU has indicated that large bailouts are not something that it wishes to continue doing for its member states. However, if the coalition refuses to bail out member states that are in danger of defaulting on their debt, the overall financial security of the European Union could be severely compromised. It is a complex issue, and to solve it, the European Union and its member states will need to re-adjust the coalition’s political, economic, and trade policies.
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Dinan, Desmond. Ever Closer Union: An Introduction to European Integration. Boulder, Colo: Lynne Rienner, 2005. Print.
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Hartley, Trevor C. The Foundations of European Community Law: An Introduction to the Constitutional and Administrative Law of the European Community. Oxford: Oxford University Press, 2007. Print.
Horn, Heather. "The Problems Facing the EU." The Atlantic. 22nd September. 2010. Web. 23 Feb 2013. [http://www.theatlanticwire.com/global/2010/09/the-problems-facing-the-eu/22955/].
Kohler-Koch, Beate, and Rainer Eising. The Transformation of Governance in the European Union. London: Routledge, 1999. Internet resource.
Majone, Giandomenico. Regulating Europe. London: Routledge, 1996. Internet resource.
Smith, Karen E. European Union Foreign Policy in a Changing World. Cambridge, U.K: Polity ; Malden, MA, 2008. Print.