2012-04-30 17:05
In Europe, market forces encourage integration
"The government ... is no longer sufficiently assured of the necessary parliamentary support,’’ said Dutch Prime Minister Mark Rutte in his formal letter of resignation to Queen Beatrix. The fragile coalition he led fractured over budget rules of the European Union in Brussels. The Netherlands has a national deficit surpassing the 3 percent of gross domestic product that EU members determined as the limit. Cuts estimated at 15 billion euros would be necessary to come back within the rules. National stereotypes invariably oversimplify reality. The fall of the Dutch government demonstrates dramatically that difficult fiscal imbalances within the European Union reach well beyond regimes presented in the media as profligate and undisciplined. This in turn undercuts the simplistic view that the crisis involves stark division between determined disciplined Germans and the free spending unpredictable undisciplined Greeks, Italians and Spaniards. The Dutch cabinet combined political parties that ultimately proved unable to work together. Rutte may yet be able to assemble a new coalition to address Brussels spending stipulations. An election is unlikely before summer. Budget negotiations continue among the political parties. The far-right nationalist Freedom Party sparked this crisis by abandoning the coalition government. The party is characterized by extreme hostility to both European economic and political integration, and to immigration from other countries. In recent years backers of integration have grown steadily more utopian, with ambitious visions of a benevolent Brussels managing a uniform Europe. A steadily expanding body of European law encouraged bureaucratic belief that commercial coordination is the same as political unification. However, unpredictable democracy and unpalatable populism consistently undercut this essentially utopian vision. In June 2005, Dutch and French voters decisively rejected a proposed European Constitution. The Netherlands is among the six founding nations of the original European Economic Community established in 1957, and has been the most consistent in support. Former President Charles de Gaulle of France threatened to destroy the incipient integration during 1965-66 over Brussels efforts to collect customs duties independently from member nations. The Dutch led the opposition to galling Gaullist nationalism, and over the decades have strongly backed European political as well as economic integration. Over time, French leaders have become much more consistently supportive of the EU. The contemporary European Union has broadened geographically and deepened commercially. A unified market was achieved relatively quickly in the early 1990s. Multinational corporations have been instrumental in this integration and underwrite enormously expanding capitalization. Euro uncertainty masks this positive reality. Founding Fathers of European integration were motivated to use economic means to secure a political end, namely peaceful engagement of Germany in the rest of Europe. Their goal was defined during World War II, well over a half-century ago. This has been achieved to a remarkably successful degree. The Founders' vision has become our reality. This is more important than continuing, inevitable and inevitably vexing disagreements over specific economic policies. The euro is used by only 17 of the 27 members of the European Union, 20 years after being adopted as a goal at the historic Maastricht Summit. The view that commerce encourages peace among nations long predates the EU. The European Union would survive the demise of this particular form of money. We focus too much on means, to the neglect of ends. In Europe, democracy not dictatorship has been affirmed. Powerful market forces encourage further economic integration, whether or not the euro survives. Arthur I. Cyr is Clausen Distinguished Professor at Carthage College. E-mail him @acyr(at)carthage.edu. |