The Nobel Peace Prize was awarded this weekend to the European Union (EU) for the stabilizing role it has played in a continent that was wracked by war for most of the last century. The prize was also explicitly awarded as a warning for what could happen if the EU were to abandon the unifying process amid the current turmoil.
I include this blog post to highlight the role that the EU has played and also to underline a point I have made before that, as a primarily political project, the economic aspects of the union are secondary. More, if the EU fails, the fallback position for Europe is not a return to a quiet mix of nation-states—it is much worse.
The countries involved recognize this, which is why I still expect the eurozone to survive. The news over the weekend and on Monday was mixed—as usual—but there were some positive signs. There was a good article on page A9 of the Wall Street Journal (WSJ), “Italian Leftist Touts Austerity from a Camper,” about the slow political reformation of the Italian left, which will be necessary as Italy negotiates its problems. Meanwhile, Spain continues to slowly edge down the bailout path, which is actually a good thing. The problems are real, they are not going away, and the sooner they are dealt with, the better. In essence, this is the thesis of the article on page B4 of the weekend WSJ, “Silver Lining in Spanish Rating Cut.”
Risks have not gone away, and the political pot continues to boil, per “In Shift, Backlash Builds in Portugal Against Austerity” on page A4 of Monday’s New York Times and “Proposed Euro-Zone Overhauls Endanger Broader Union” on page A11 of Monday’s WSJ. “Separatist Wins in Regional Belgian Vote” on the next page also highlights that Spain is not the only country with regional problems.
Nonetheless, the process continues, and the Nobel will help by focusing the attention of everyone, including most especially the European electorates, on why the EU still matters and deserves to survive.