Sunday, May 29, 2005

The EU

There are strong indications that France and the Dutch may vote down the EU constitution, in Elections coming shortly. Will it be a disaster for Europe? No! The economic integration of the Continent will not be undone, and the substantive agreements will remain in force. Europe may simply remain basically as it is Today, with little gain or loss.

Study of history provides an equivalent example. The United States started out as the Confederation of States, an integration little more than the current status of the EU at this point. They needed a new union in 1785, because economic functions could not be realized under the Confederation of States, basically elimination of Tariffs between States and uniform Tariffs applied to foreign Goods in different States. There was also the political goals of preventing individual States from establishing independent Treaties with foreign Powers.

Here is where the Confederation of American States diverge from the current EU. The Confederation lacks sufficient economic integration and economic linkages for unitary action by all States. The basic lack in the Confederation was inefficient Lines of Communication, both Political and Economic. The European Union, on the other hand, enjoys rapid and effective Lines of Communication, alongside extensive Private Sector integration of economic function. The political integration, as it now stands, remains sufficient to maintain the Status Quo.

Economists and Journalists propagate the theory of EU economic stagnation, a concept hard to accept when viewing the reality. Europeans enjoy a relatively high Standard of Living, good to excellent health care, and are altering their Pension plans to endure the coming decades. European businesses continue to be profitable, though Americans criticize European business practice for failure to develop according to the American model. Reality would claim Europe could not adopt the American model, which consumes too large a segment of the Resource pool, and could not be sustained by their economies. This Author believes Americans will eventually have to adopt the European model of business practice, due to reduction of Resources.

Europe does not need a political constitution, but Americans must start to think about Conservation. lgl

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