Tag Archives: Eurozone

The future of the EU… and the world

I’ve been thinking about the European Union and Europe a bit recently – partly because of the obvious reasons, such as the media saturation of the Hollande/Merkel showdown and the Greek crisis, and partly because I’ve applied for a job working with the EU delegation here in New Zealand. This has led to ponder on the future of the EU and what that means for the world in general. With the Eurozone on shaky ground, little has been written about what any sort of rush for the exits will do for the wider EU as a whole (at least that I’ve seen) but to me this raises some very serious questions.

The EU can be viewed as an experiment in liberal international relations theory and the results of this experiment could influence global politics for years to come. Should the EU manage to evolve and strengthen through dealing with the current crisis then other regional unions such as ASEAN might see it as a reason to pursue closer economic and political cooperation. However if the Eurozone crisis damages the EU’s credibility and weakens its institutions then the future of regional unions as important units in international relations will presumably be less rosy. On top of this, there is the simple fact that Europe is still a major player in global affairs even in the post-colonial era. The EU is home to half a billion people and represents 20% of global GDP. Although some experts think its influence is in decline these numbers alone show that it is still a big player, while the impact of its history on the way the rest of the globe works today is undeniable.

So where does theat leave the EU today? Even if we assume that Greece exits the Eurozone in the near future and triggers the other troubled countries (Ireland, Spain etc) to do the same, would that necessarily be bad for the EU? Some say it would, some say it wouldn’t.

I would personally answer this question with a definitive “maybe”. Sure, that’s a cop-out but with no real precedent to compare to that I’m aware of this is all dangerous new territory. The EU is already considered by some to be undemocratic, and there is at least some popular support for its dissolution, but whether this would reach critical mass following a Eurozone collapse is hard to say. I think the safest thing to predict is that the EU would continue to exist but its powers would be limited to what they are today (excluding the Eurozone bit of course) and it would take a very long time for Europe to move towards closer integration again, if it ever could. While Russia at least would probably welcome this move, from a broad historical perspective it would be a rather tame and sad end to one of the first real attempts to develop a post-nation-state way of approaching global politics. On the other hand, if the EU deals with the Eurozone crisis well it could signal a way forward for states to surrender sovereignty to a higher power in order for economic and political security – which is after all the whole point of the EU anyway.

In some ways the EU’s current problem with the Eurozone shows that it is stuck in the  middle of the pull of nation-states and state sovereignty on one side, and the push to closer integration and a possible federation of Europe on the other, and the halfway point has not been a compromise that has worked. At a deeper level though I think this reflects a constant in European history – the diverging sides of the European experience as it were. There’s the Europe of the enlightenment and humanism, and the Europe of bloody conquest and rampant nationalism. Not that I’m equating nation-states with evil deeds, or saying that a post-nation-state way of governing peoples would be superior, but simply that it is mistake to think of Europe purely in one sense or the other. Although Europe has historically been progressive, it has also historically been reactionary. Another example of this duality is the fact that Europe itself was the birthplace of the modern nation-state yet it still retains some pre-nation-state entities, such as the city-state of Monaco, or San Marino, or even the Vatican.

Even if the EU comes out of the Eurozone crisis stronger, there are still a number of challenges facing it. Foremost among these is where to stop expanding – check out the GIF on this Wikipedia page to get a sense of what I’m talking about. Will Turkey become a member? Georgia? Armenia? How far can the European Union expand and still be European? As it expands eastwards it also run up against the Russia’s sphere of influence and this could be a very difficult relationship to manage, especially considering the partnership between the EU with NATO. If the EU stops admitting new member states will Europe fall back into a division like that between communist and capitalist, or Orthodox and Catholic? As well as these concerns, there is the question of the way forward for the EU – how should it develop its institutions to be more democratic? How much sovereignty are its members willing to cede, and what can be offered in return?

The rest of the world will learn lessons from how the EU handles this crucial point in its history. This isn’t Eurocentrism but simply a reflection of the fact that the EU is sailing into uncharted waters. How it navigates them will ultimately decide if anybody wants to follow in its wake.


Greece is now a failing state (in my opinion)

The most common definition of a state one is likely to encounter in the social sciences is Max Weber’s one which say that a state is an entity which has a monopoly on the legitimate use of force within its borders. An interesting take on this which reframes it in a more day-to-day metaphor is Charles Tilly’s description of the state as a protection racket – effectively saying that citizens pay tax to be protected from external (and internal) aggressors, and if citizens fail to pay the state then the state uses its force against them in the form of criminal prosecution.  If we accept these broad definitions then a failed state is one which can no longer exercise a monopoly on violence, or to use Tilly’s idea, can no longer maintain its protection racket. A failing state is one heading towards this position.

I like both these definitions for their simplicity and for capturing the essence of the nature of states. They also tie in nicely to the idea of the social contract, which is a prominent part of political science theory discourse. I think that Tilly’s protection racket concept could be widened to encompass the idea that the violence the state protects its citizens from is not just physical but economic. Economic violence could be the effects of poor fiscal and monetary policy, or external forces such as being out-competed by other states, but the idea is that if the state cannot protect its citizens from prolonged economic hardship then it is not living up to its end of the protection racket bargain. In social contract terms, the state has broken the contract to provide for its citizens.

Watching coverage of the Greek elections today, I was struck by the shambolic state of affairs this rather important country has found itself in. It seems to me with my limited understanding of economics that the adoption of a single currency by  group of sovereign states could never work in the long-term… but I digress. I think its time to stop kidding ourselves and admit that the Greek state is failing. One obvious example of this is the rampant tax evasion in Greece, which by some estimates has cost the government a third of its potential revenue. The Greek state has not been able to enforce its protection racket by collecting its dues, and now it can’t protect the people from the economic violence being wrought on them. This is not just the specific government in power’s problem, but the actual state artifice itself. It doesn’t matter who is elected in if the underlying structure is not being honoured by everyone. Those people who are avoiding tax are not going to start paying because someone new is in charge. Other taxpayers stopping paying because of the failures of their state is also a potential problem. Of course, tax collectors could be hired or new methods of enforcement could be tried but until these measures actually start to make headway the Greek state will continue to be “failing” at least in my eyes.

How far Greece can go before total state collapse is an open and very scary question. I think it will most likely avoid that path, but it is still definitely a possibility. European leaders should quietly be making plans for this outcome because if it does happen a whole world of sh*t will follow.


What makes the news the news?

Obviously there’s a lot more going on in the world than can fit in an hour-long news show or on the front page of a website, so how do certain events become considered newsworthy and others not? There seems to be two common answers to this question: the mainstream view that stuff that makes the news does so because it is more important than stuff that doesn’t, and the leftie perspective that the stuff that makes the news represents the interests of powerful businessmen and politicians. I think both these arguments have merit in certain situations, but there’s other factors at play  that don’t often get considered.

Firstly, the two commonly presented reasons for the nature of news coverage. Some events have a much larger impact on people’s lives and global politics than others, and these generally make the news over things that have a lesser impact. For instance an event like the Eurozone crisis receives much more global coverage than a constitutional crisis in Papua New Guinea because it can affect almost everyone on the planet through disruption of financial markets, lost jobs, currency fluctuations etc, whereas as interesting as the PNG crisis was it really only affects people who live there or have interests there. Fair enough then I guess. However, the statement that the news represents the interests of an elite is also broadly true – especially in how certain events are portrayed. The lack of coverage given at the time to such monumental events as the biggest conflict since WWII can only reflect the fact that there was no business or financial interests for the West to protect in this case and thus it wasn’t deemed important. But surely an event does not have to be influential on the people reading its lives for it to be considered newsworthy, or else why does Syria dominate the news? As horrible as the situation there is it doesn’t directly affect the lives of the vast majority of news consumers in the same way that the Eurozone crisis does. The 10,000 or so dead there sounds like a lot, but more people than that are estimated to have died on the island of Bougainville during the war there and I doubt many people have even heard of the place outside of the South Pacific. This will probably change when a movie about it starring Hugh Laurie comes out.

So importance to the audience generally and the interests of the “news-selectors” (to perhaps coin a phrase) are both factors in what makes the news, but they are not the sole determinants. One blindingly obvious factor is that there is always going to be a finite amount of reporting available even in our information-saturated internet age and so certain events will always be excluded. Similarly, it is easier to report from certain environments for logistical reasons and thus this influences the level of reportage. Ultimately though I think the biggest factor that people don’t realise is a version of the network effect.  Once a news story starts to get attention other people hear about it and read about it, and then it begins to be perceived as important and gets more attention over time. If one website or news agency reports on an event its competitors will too because they will worry about missing a story and thus losing credibility.  Some events will gain enough interest when they first occur to reach a critical mass and continue to be reported on, while others won’t get enough attention and will fall off the radar. At least in the internet age if you are really interested in a story you can look it up yourself, but the idea that the web would destroy traditional news providers seems to have been disproved. Most people are happy to be told what the news is, and won’t question why one thing is news and another is not.