Major issues facing the European Union

Six Reasons the European Union Will Not Last
Introduction
The European Union (EU) is the heart and soul of modern Europe, yet it is not without its challenges. Whether it comes to trade issues, member states failing to follow regulations, or immigration issues, the EU has no end of problems that arise from year to year. This paper will describe a few of the challenges and show why the larger issue of representative government in modern Europe is now coming face to face with an increasing wave of nationalism and a push by some member states to exert more sovereignty over their own affairs without respect to what the EU has to say about it. After looking at issues such as 1) Brexit, 2) the immigration crisis, 3) the open borders policy, 4) the problem of NATO, 5) the ultra-high and potentially catastrophic levels of debt that the European Central Bank (ECB) has made possible through its easy credit and low interst rates monetary policy, and now 6) the COVID-19 coronavirus pandemic, this paper will show why the future of the EU looks grim and what might happen if it does completely disintegrate in the near future.
Brexit
Nothing scared the EU more than the thought of Brexit—England breaking away from the EU and undermining the sense of unity and security that the EU had established over the years. First voted on in 2016, it was not actually until 2020 that Brexit officially took place (BBC, 2020). The UK now stood apart from more than two dozen European nations for the first time since 1973. Not only was this a shocking new development that showed the world the UK was going to reassert its sovereignty on the world stage, it was also an invitation for other nations to follow suit. Since Brexit was first voted upon in 2016, other nations’ leaders have threatened to lead a revolt against the EU and do the same.
From France to Italy to Spain to Hungary and on, a rising tide of nationalism has exalted several independence movements and garnered a great deal of support for populists who are fed up with EU policies that they see as prohibitive, punitive, and dangerous for their own nations. Leaders in Italy, France, Hungary, Spain, the Netherlands, and Greece have all been quite vocal about their issues with the EU, and now that the UK has officially taken steps to leave the EU, it leaves the Union more unstable than when it entered in. There is now a great deal of uncertainty about whether the EU can assuage the nationalist wave spreading across the Europe. With each nation now thinking of its own self-interests instead of the collective, there could be many more nations that follow the UK out the door in the coming years.
The Immigration Crisis
One of the reasons for the rise of nationalism has been the immigration crisis stemming from the non-stop wars in the Middle East that have decimated the region and forced millions of migrants from their native lands. Currently Turkey is threatening to unleash a tsunami of immigrants onto an already hemorrhaging EU, whose member states (like Hungary) are refusing to take even one immigrant into their country. Germany has been very open about accepting immigrants, but it has come with a tremendous price for the party involved in making that decision. Germany’s leader Angela Merkl, so often seen as the face of the EU has lost considerable prestige and support in Germany as native Germans have expressed their discontentment with their leader’s willingness to give refuge to millions of Middle Eastern refugees. The Germans, like the Hungarians, the Italians and the British are all concerned about the safety risks, the economic risks, the health risks, the social risks, the cultural risks, and the political risks that come from allowing so many refugees through their borders. Considering that the threat of terrorism is still high in Europe and that many new terrorist attacks have occurred in EU countries since the immigration crisis began, it is not hard to see why citizens of these countries are rallying behind leaders like Nigel Farage, Boris Johnson and Marine Le Pen. As the Graph 1 image below shows, many Europeans see refugees as an existential threat.
Graph 1. European perception of immigrants as threat. Pew Research Center (2016).
As the Pew Research Center (2016) graph shows, nearly three-fourths of Poland sees immigrants from the Middle East as a threat, and approximately two-thirds of the public in Greece, Hungary and Italy feel the same way. Opinion was divided in the UK and yet the majority of the public was able to leverage their views to get Brexit accomplished. The risk for the EU, now, is that with so many people in so many different countries still upset with the immigration crisis and no end to that crisis currently in sight those countries may vote to leave if that is what it takes to get their borders shut.
The Open Borders Policy
Indeed, one of the worst policies to have come along in the opinion of EU member nations has been the open borders policy, which allows an EU citizen or guest to freely travel from one member nation to the next without requiring a VISA. If one is a citizen or guest of one country, then one is a citizen or guest of all countries. In idyllic terms, it is a great idea and represents a harmonious state. However, the world is not at all harmonious and the practical problems that the open borders policy leads to is a destabilization of local social structures, national economies, national character and culture, safety and sovereignty. Many countries around the world control their borders tightly for security reasons—such as Israel, Russia and Canada. Yet the EU has done just the opposite and has seemingly invited the world to come into its home and make itself comfortable.
What are the ramifications of this policy? The UK has now left the EU altogether and Hungary has refused to get in line behind the EU’s immigration plan. Italy is threatening to break with the EU. Those are the political ramifications. There are economic ramifications as well as Wirtz (2019) notes: immigrants and travelers are able to take advantage of welfare benefits of EU member nations, which has added more strain to these countries’ budgets and required the ECB to act by keeping rates low and by subsidizing markets. This has led to asset price inflation and a loss of price discovery. The health risks of this policy are also now apparent with the spread of COVID-19, which originated in China and is now all over Europe. Security risks have arisen as well, with terror cells developing throughout the EU and harming tourism and social stability in the member states’ nations.
Thus, while the EU attempts to be a form of representative government for various nations, it ends up subverting the sovereignty of those same notions, which leads to political and social unrest. That unrest has manifested itself mainly through populist politics, and in the case of the UK it has led to Brexit. What Brexit will mean for the rest of the EU remains to be seen, but it is likely going to be a harbinger of things to come. Since nations within the EU are not permitted to close their borders, it is quite likely that those nations will simply close the EU. Problems relating to the EU’s open borders policy are numerous, and COVID-19 is the latest one.
COVID-19
The infection rate and death toll from COVID-19 continues to rise, and that means tourism is falling sharply, and national economies are going to be hurt. How is this going to impact the stability and strength of the EU, which is already wounded economically as a result of an approaching recession in Germany (Chadwick, 2020)? The health risks that the spread of a highly infectious disease pose can be a very good reason for countries to close their borders and monitor more control over who comes in and who goes out. But the EU is now reaping what it has sown in terms of promoting a kind of utopian collectivism in which the diverse states of Europe are meant to feel that they are all in it together—even though historically speaking the various cultures and kingdoms of Europe have rarely ever really gotten along for a significant period of time. There is too great a sense of self-interest, too great a need for self-preservation, and too much pride in their own national characters and cultures to allow an experiment like what transpired in Russia in 1917 to happen to all of EU. The COVID-19 virus is just one more practical reminder of why it is not a good idea for sovereign states to submit themselves to a central authority that has an open borders policy (Grose, 2020). Having a government like the EU comes across as a serious impediment in the face of a pandemic like COVID-19. It represents the kind of bureaucratic response to an emergency that autonomous nations are happy they can do without.
NATO
As Herszenhorn (2019) points out, the EU has a NATO problem. NATO is the North Atlantic Treaty Organization that was developed after WW2 to help reduce the risk for another such war from happening. At least that was the idea in theory. In practice, NATO has been used as a tool for Western imperialism in the Middle Eastern on multiple occasions. In fact, it is the EU’s involvement in NATO that has directly fueled the immigrant crisis now ravaging Europe and causing the populist-nationalist wave threatening to undercut the EU. If the EU was supposed to ensure unity among the European nations, NATO steered that objective wildly off course by bending the will of Europe to the will of the Pentagon in Washington, D.C.
Now the EU faces the trouble not only of deciding what to do about NATO and its ties to the US but also how to ensure that every nation is doing its part to fund NATO, which is something the Trump Administration has been insisting on. However, most EU states are hurting economically and that is only set to get worse now that a deadly pandemic is sweeping the world, crushing supply chains, and closing entire communities, preventing them from benefiting from their tourist economies. The cost of staying in NATO makes little sense economically, politically or socially. NATO has done nothing but advance Washington’s aims in the post-war era. Europe should be getting along with Russia rather than working with the US to isolate it. Europe and Russia are naturally allies and there is no reason to try to create dissension between the two—and yet that is what NATO is used for. Thus, it does not even benefit the member states of the EU to be beholden to NATO.
Debt
And all of that brings one to the problem of Europe’s increasing debt. The 2008 economic crisis should have let a great deal of bad blood out of the financial system—but it did not. Instead, the united central bank intervention that occurred around the world made sure the bad blood stayed in and that a hundreds of zombie corporations could continue to exist on cheap credit and no real net income. The reason for this central banking intervention is simple: the global economy depends upon the concerted management of the global economic and financial system because that system is what allows cheap labor, pensions, and promises of welfare to be distributed. The EU is no different in that it also depends upon cheap labor and pension plans (and insurance funds) that invest in the stock and bond markets to produce returns that are then used to fund the Ponzi scheme that is corporate and social welfare (Amadeo, 2019).
The EU’s member countries are not meeting economic goals. Germany is facing recession now. Italy and Greece are practically insolvent. The UK has left and is no longer propping up the EU economically. France is awash in a welfare system that will collapse if the markets do. The central banks have no choice now but to continue to print money and inject it into the system and to keep interest rates at or below zero so that the zombie corporations can continue to exist and sell shares to the public, the pension funds, the insurance funds, and the sovereign wealth funds.
However, the printing cannot go on forever before hyperinflation sets in, and the slightest disturbance—like a black swan event such as a pandemic that destroys supply chains and halts all business—will have a crippling effect that will leave the EU in tatters. Relying upon a command economy instead of a free market economy puts the EU in a precarious position, because when it can no longer command the economy it will collapse the same way the Soviet Union did.
What the Future Holds
The future of the EU does not look bright considering what has happened, what is happening now, and what is likely to happen in the future. Nationalism is not abating. The COVID-19 virus could seriously destroy the EU’s ability to maintain control of the markets and the economies of Europe. The UK has already left, setting a terrible precedent for other countries to follow. These trends are not positive developments for the EU and with the global economy wavering there is a great deal of downside risk. How can the EU weather the coming social, political, and economic storm that is gathering overhead?
The reality is that managing a modern representative government among dozens of diverse peoples and nations is not as easy as was envisioned fifty years ago. Moreover, the fact that so many new nations that are only marginally European have been accepted into the EU is an indication of the complex nature of the enterprise that the EU has undertaken. It is now attempting to govern nations with very different characteristics, cultures, ambitions, and identities. The sense that one has from watching the EU is that it is not so much about spreading prosperity and ensuring peace as it is about control and exploitation. Greece is nothing more than a debt colony today and should have never been admitted into the EU in the first place. But with the help of Wall Street and the ECB, the tiny nation was able to join and become a debt colony. Italy is in similar shape, as is Spain, Ireland and others. How is this a system that can work for long?
Thus, the future looks bleak for the EU. It is not going to be able to address its internal problems, which are leading to the rise of populist voices and nationalist movements, even in the normally staid Germany. The EU is not at a crisis point: its purpose and function has been shown to be unnecessary by Brexit. The UK, after fifty years of participation decided that enough was enough and that it was time to hand back its membership. What example has that set for the rest of the EU’s member states? If any of them dares to try to go it alone the way the UK has they may just find that they can indeed stand on their own two legs. Such a discovery would be shattering for the EU and the Euro. And what would happen to the debt colonies of Europe then?
Conclusion
The EU is having an existential crisis. The current pandemic, the mounting debt, the NATO tensions, the exit of the UK, the rising tide of populism/nationalism, the open borders policy, and the immigration crisis are all signs that the EU is facing a potentially fatal moment. Should the collective tide turn against the representative government that is the EU, it could be torn to tatters in relatively short order. This would lead to fragmentation of Europe like never before seen and undoubtedly the beginnings of a new war.
References
Amadeo, K. (2019). Eurozone debt crisis. Retrieved from https://www.thebalance.com/eurozone-debt-crisis-causes-cures-and-consequences-3305524
BBC. (2020). Brexit. Retrieved from https://www.bbc.com/news/uk-politics-32810887
Chadwick, L. (2020). Recession could tip EU. Retrieved from https://www.euronews.com/2020/02/27/could-covid-19-coronavirus-trigger-a-european-economic-recession
Grose, T. (2020). Coronavirus tests Europe’s open borders. Retrieved from https://www.usnews.com/news/best-countries/articles/2020-03-02/europes-open-border-agreement-may-become-casualty-to-coronavirus
Herszenhorn, D. (2019). Europe’s NATO problem. Retrieved from https://www.politico.eu/article/europe-nato-problem-defense-procurement-training-research/
Pew Research Center. (2016). European opinions of the refugee crisis. Retrieved from https://www.pewresearch.org/fact-tank/2016/09/16/european-opinions-of-the-refugee-crisis-in-5-charts/
Wirtz, B. (2019). The Beginning Of The End Of Open Borders In Europe. Retrieved from https://www.theamericanconservative.com/articles/the-beginning-of-the-end-of-open-borders-in-europe/