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Market Oracle FREE Newsletter


Does The European Union Exist?

Politics / European Union Mar 05, 2013 - 02:21 PM GMT

By: Andrew_McKillop


The justifiably almost forgotten early 19th century French economist Frederic Bastiat is sometimes painted as an "early Austrian School" thinker - but his theories and one-liner aphorisms are also used to defend the various forms and types of "European Union". This started in the early 1950s, to organize iron, steel and coal production - all of them now Sunset Industries, in Europe. The idea of "Union" by 1956, had morphed into Euratom and the lure of almost-free and of course clean and safe nuclear power for every European. Nuclear power, today, is also something of a Sunset Industry. The first European customs and tariff union, with a few add-on political gimmicks was created the same year, in 1956, and called the Rome Treaty.

Like Bastiat's aphorisms, for example on the perils of trying to tax sunlight (to protect manufacturers of candles), the "European thing" of the 1950s was an amusing small-sized elite talk shop having almost zero relationship with the real economy, society or politics. Economic growth was strong; there was full employment; national debts were low or zero; the elite plaything idea of a Great Federal Europe could be treated as a side dish for speakers at invitation-only, high priced dinners. Above all, it didnt matter.

Wags in fact say these dinners were so select and so discreet that they were the cause of Henry Kissinger’s derisive question: what is the phone number for Europe? He hadn't been invited, and missing even one free lunch and opportunity to spout is terrible for folks like Mr H. Kissinger.

Time moved on and "the Union" kept growing, still hidden behind pseudo-economic wraps, called "the Economic Community". As the economy turned down, sharply, from the first Oil Shock of 1973-74 the enlargement of the Union became the obsession of its rentacrowd intellectuals, its powerbrokers, Commissioners and Seigneurs. Always more voices, always more confusion. The recent formal approved of the Lisbon Treaty by the governments of all 27 member states has predictably raised the confusion quotient to levels where, as a result, president Obama decided it was "not possible" for him to attend at least one recent US-EU summit. Quite interestingly, president Putin can and does attend Russia-EU summits, and the Chinese leadership comes along to equivalent talkshows, also. Maybe they like the menu at the banquets.

The rising, ever stronger voices of opposition to "the Union" always use the Lisbon Treaty as proof of their worst nightmares: if we believed in this Treaty it would create new continent-wide powers, offices and layers of unelected government, would reinforce the almost non-existent authority of the European Parliament, and would reduce the power of mostly unpopular, or very unpopular national governments. This would create "a more coherent and unified Europe", possibly able to do what Bastiat said Europe needed, notably fast rail transport links between the countries, to increase their comparative advantages and benefit from Free Trade.

Inside a customs union, or outside of it? Bastiat avoided this subject.

The traditional role of "Leading Europeans", for at least 50 yars, is to say they are frustrated that the Union is moving so slowly, does not "speak with one voice", and has little or no real geopolitical leverage commensurate with its economic size. French president. Nicolas Sarkozy in 2008 contended that “Europe cannot be a dwarf in terms of defense and a giant in economic terms.” Since 2008 as we know, it is working hard to reduce its economic power to crippled dwarf status.

Outside of Europe, this is all very well known. The "Union" is treated for what it is: a trade bloc with pretensions of Other Powers, usually undefined, which it has failed to realize because it is divided, has tiny minded goals, and is very badly organized. Imagine the Vatican if it also owned and ran WalMart! How long would WalMart survive?

In a true return to its origins - an elite after dinner debating club, invitation only - the dirty work of pushing through the most recent treaties, since Maastricht in the 1990s, and especially the Lisbon Treaty, is always carried out in private. Opinion polls in nearly all countries show that 50%-60% of voters would vote against the Lisbon Treaty, if they were allowed to vote on it, and more than that would vote against if even a small amount of the fine print details were explained to them. The Bad Treaties are rammed into effect by the Eurocrat elite.

Above all there are no, repeat no benefits for average Europeans - we mean much more than 95% of all persons - from the Bad Treaties. The European Commission, Parliament, and other vested interests are of course obliged to ritually intone" "Give us time". The promised benefits will come. Public accountability (whats that?) is completely unnecessary. The official reasons for this include the "need to move very rapidly". At a snail's pace.

The so-called Technocrats have been fully mobilized. Apart from "president" Herman Van Rompuy of Belgium, the choice of "foreign minister" trumped Van Rompuy for lack of luster or lackluster-ness: England's Baroness Catherine Ashton, who has never held elective office, anywhere. How was she chosen, or why was she chosen? The Eurocrat cult of "discretion" produces these things. There is also the famous "rotating six-month presidency" of the European Union Council, currently held by Ireland, to be followed by Lithuania from July 2013; add in the  president of the European Commission, Jose Manuel Barroso. Do not forget (although it is very easy), EU president Van Rompuy.

The Eurocrats might, in theory, be a little ashamed of where their empire-building has got them. On the world stage, apart from economic issues, Europe remains what small-sized Sarkozy calls a dwarf, but has now made itself so confusing, so laughable that it would take a very long time to salvage something from the wreckage. Reflecting this from at latest since 2010, the Obama administration utilizes statements like this, from State Department spokesman P. J. Crowley: “Because of changes involving the establishment of a EU council president and a European commission president on top of the rotating EU presidency, I think it’s taking some time to work through exactly how various high-level meetings will happen.”

He meant "can happen": Europe's voice, even inside Europe is bathed in confusion, but outside Europe it is above all of no crediblity or substance. "Three presidents?" Forget it.

The Eurocrat system of calling summits for every imagined problem, with a possible New Treaty coming out of it, always in private, has produced the worst possible confusion - we can call it chaos.

The present attitude of the Obama administration to Europe is no surprise. It takes the EU even less seriously than George W. Bush. Leading editorialists in Eurocrat-friendly news media have practiced the ritual cries of disappointment at the world "not understanding Europe" for years, but this playact is worn out. Continuing this vintage playact, however, is critical face-saving for the Eurocrats.

If or when certain Treaty provisions (of the Lisbon Treaty) were interpreted as Eurocrats pretend they wanted them to be interpreted - when they, the Eurocrats were cobbling these Treaties together - there would be joint military action by the straight majority of EU states in the Mali war of 2013. In fact, also including France (the sole "player" in the Mali war), every European country is shrinking their military spending (like the US), and are much more than slightly reluctant to get their troops messed up in dangerous missions (again like the US). These trends are likely to continue. Foreign policy is becoming non-military, we might imagine, but with "the Union" the morph is far more radical than this "peace and love" default policy: Europe has no foreign policy at all. It is not interested in the subject.

Europe’s attitudes and behavior are to be sure impossible to understand, let alone interpret because there is no such thing as "one voice". The interests of Europe’s peoples are primarily eonomic, and Europe has a deadly combination of economic crises: why add foreign policy crises? Basically, Europe is isolationist and mercantilist in the oldest sense of these terms that Frederic Bastiat railed against. Put another way, Europe learned to tax sunlight - as well as candles.

Former "foreign policy" meaning military action Over The Horizon is in any case finished; over the horizon, today there are players as unfriendly or dangerous (or both) as Russia, China, India. For Europeans, it is Washington that runs European foreign policy. This is not exactly germane to the US.
Philip Gordon, Assistant Secretary of State for Europe and Eurasian Affairs put it bluntly on a trip to Brussels: “We want to see a strong and united Europe, speaking with one voice. In the best of all possible worlds, that one voice will be saying what we want to hear. If it is not saying what we want to hear, then we would rather that voice was less united.”

This is what he said, and what he got. Inside Europe however, there are almost no advantages to "the Union", its de facto peacenik "foreign policy" stance fools few people outside of Europe. With its economy in a dreadful mess, reforming the Eurocratic system of confusion is now overdue - simpy scrapping it could be the best solution.

By Andrew McKillop


Former chief policy analyst, Division A Policy, DG XVII Energy, European Commission. Andrew McKillop Biographic Highlights

Co-author 'The Doomsday Machine', Palgrave Macmillan USA, 2012

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

© 2013 Copyright Andrew McKillop - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisor.

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