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The
European Union
Brian
Trumbore
President/Editor, StocksandNews.com
A few weeks ago I was in Bulgaria and
Romania when these two received official word they
would be the 26th and 27th countries admitted to the
European Union (EU) come January 2007, but with strict
conditions; such as the need to curb excessive corruption,
particularly in Bulgaria.
Some
in the EU are complaining of "enlargement fatigue,"
while others talk of further expansion, starting with
the likes of Croatia (perhaps 2010) and Turkey (2015).
So
I thought it was a good time just to remind everyone
of just who is in the EU and how we got to this point.
---
1948:
Talks begin on having a "European Community" after
the devastation of World War II.
1951:
Treaty of Paris establishes economic union of coal
and steel producers, including France and Germany,
a forerunner to the EU.
1957:
Treaty of Rome. Belgium, France, Italy, Luxemburg,
Netherlands, and West Germany create the European
Economic Community (EEC).
[In
the 1960s, French President Charles de Gaulle, concerned
that France's voice in world affairs was threatened,
vetoed Britain's application for membership.]
1973:
Denmark, Ireland, UK added.
1981:
Greece added.
1986:
Portugal, Spain added.
1991:
EEC renamed European Union.
1995:
Austria, Finland, Sweden added?now 15 members of EU.
2002:
'Euro' introduced in 12 EU member states [Denmark,
Sweden, and UK elect not to, or fail to meet standards.]
2004:
Cyprus, Czech Republic, Estonia, Hungary, Latvia,
Lithuania, Malta, Poland, Slovakia, Slovenia added
to EU.
2007:
Bulgaria, Romania added. [26 and 27]
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How
does the EU-25 (so not including Bulgaria and Romania)
match up with the United States?
Population
wise, the EU-25 has about 455 million versus 300 million
for the U.S.
As
for GDP, the EU-25 is in the $12.25 trillion range
(as close as I can ascertain), while the U.S. economy
now exceeds $13 trillion ($13.2 by the latest count).
[As
of 2003 they were virtually equal but since then the
United States has been growing at a far more rapid
clip.]
Both,
however, have severe pension and entitlement issues
coming up as the respective Baby Boom generations
age, though even here the U.S. has a distinct advantage
in that America's population continues to grow, thanks
to immigration, while Europe's is stagnating and on
the verge of falling over the coming decades, which
in turn will only exacerbate the pension issues on
the Continent.
---
On
a separate matter, the European Union Constitution
is said to be structured for only 27 nations and now
the limit has been reached, but in proposing changes
for a new document back in 2004 and 2005, voters in
France and the Netherlands rejected the constitution,
throwing the whole process into a state of limbo as
all EU members must ratify it before it becomes law.
[Not all need to hold referendums, though, as was
the case in both France and the Netherlands.]
---
As
for the common currency, the euro, anyone who travels
in Europe has to love it, except for the fact the
dollar has been getting crushed against it the past
few years and our greenback sure as heck doesn't go
as far as it used to. I mean have you seen the cost
of a pint recently?
Twelve
nations currently use the euro.
Austria,
Belgium, Finland, France, Germany, Greece, Ireland,
Italy, Luxemburg, Netherlands, Portugal, and Spain.
Slovenia
will adopt it Jan. 2007.
As
noted above, Denmark, Sweden and the UK for various
reasons have opted out thus far but could adopt the
euro basically any time they want as long as they
met various monetary targets, while the other 11 new
members (including Bulgaria and Romania) will need
more time before adopting the currency.
---
One
final issue that I've brought up extensively in my
"Week in Review" column over the years is the fate
of Turkey, which a while back was eager to join the
EU. But now, with both an Islamist government in power
in Ankara and an anti-immigrant backlash across Europe,
post-9/11, Madrid and London bombings, etc., admission
is far from a sure thing.
French
Interior Minister (and possible successor to Jacques
Chirac) Nicolas Sarkozy.
"Next
year's 50th anniversary of the EU's founding Rome
treaty should be celebrated with pride, for it marks
an historic achievement: Half a century of reuniting
a divided Continent. But there is also cause for concern.
The forces driving the Union's political momentum
have run out of steam and Europe's citizens are either
doubtful or indifferent to its aims and lack any real
collective hope for the future?.
"Of
all the countries with which the EU should have preferential
relations there is Turkey, our neighbor and friend,
sharing many of our security concerns and many of
our values. These are good reasons for strengthening
our ties with Turkey, without going so far as offering
full membership.
"However,
no candidate for EU membership has the right to ignore
that the Union has 25 members, including Cyprus. Despite
the customs union between Turkey and the EU, Turkey
continues to deny access to its ports and airports
to boats and airplanes that have stopped in Cyprus.
This is not acceptable. I say again and again that
the EU must suspend any new accession negotiations
with Turkey until Ankara has ratified and implemented,
in good faith, its agreed trade protocols."
And
then on Thursday, Oct. 12, the French parliament approved
a bill making it a crime to deny that the 1915-17
massacres of Armenians by the Ottoman Turks constituted
genocide.
Turkey
strongly contests this and is furious. Turkey's parliament
speaker called the French vote "shameful" and reflected
a "hostile attitude."
The
European Commission also criticized the French bill
but the damage to EU-Turkish relations has been done.
Sources:
BBC
News, Financial Times, Times of London, The Economist,
International Herald Tribune, Wall Street Journal,
European Union
Wall
Street History returns next week.
Brian
Trumbore
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