EU and its members are paying the price of past neglect
Europe's development is a huge success story emerging from the ruins of the Second World War to today's European Union with peace and prosperity.
Unfortunately, it appears that the EU - but mainly its member states - have lost focus as priorities have been neglected in a mania of harmonisation, writes Prince Michael of Liechtenstein.
Many issues are harmonised, especially regulations which ignore the advantages of regional competition. But those essential areas which should have a common approach - besides having one market - are neglected. These include a common foreign, security, and defence policy and an independent monetary policy for the eurozone which forces eurozone countries to respect the criteria. Neglect has been at national as well as European levels.
The consequences of this approach can be seen today in three areas in Europe.
Defence has been ignored in a totally irresponsible way based on populism and short-sightedness. In the same way, foreign policy has lacked understanding and vision.
Relations with Russia have been mishandled because of a lack of foreign policy skills. The lack of defence has hampered taking strong positions towards Russia’s aggression. A prudent foreign policy combined with a credible defence could have avoided Russian aggression and the current disaster in Ukraine.
Immigration from Africa and the Middle East is another foreign policy and security issue. This has always been a ‘hot potato’ and it has been obvious for years that an increasing number of immigrants would flow from poor countries with a population surplus to rich countries with stagnant or decreasing populations. But there is no European policy which tackles this problem sufficiently.
Greece is a typical example of expediency in eurozone monetary policy. It was a disaster that Germany and France officially broke the criteria for the euro in its early stages. However, it must have been known that Greece has manipulated its figures for years with advice from leading investment banks. The Greek financial disaster could not possibly have come as a surprise.
Greece’s new populist government is now playing games with European decision-makers because Europe has turned a blind eye. This has meant that the Greek government can be insolent and once again increase the size of government and make optimistic remarks as it anticipates receiving another tranche of money.
Its finance minister Yanis Varoufakis said, ‘Our strong stance, based on logic, will lead to an agreement, even at the 11th hour’, while Prime Minister Alexis Tsipras told US Treasury Secretary Jack Lew, ‘Athens is intent on reaching a deal with its partners on a new support programme which will put an end to austerity and pursue necessary reforms’.
Greece’s finance minister was a professor specialising in game theory. He is using those skills now to play a game of someone who has nothing to lose, especially trust and reputation.
There is another issue too. Greece has an important strategic position in the Eastern Mediterranean and is a member of Nato. It would be a huge blow for the Western Alliance to lose Greece and open up an opportunity for Russia or China, in view of Europe's generally weak defensive position. Greece’s new government appears to be flirting with Russia already.
Perhaps that is another card Greece wants to play in the game of extracting extra funding?
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