Updated: Jul 1
Coronavirus is the pandemic that is contaminating our health, economy and now, our European-being.
I understand that this article might have a very big share of people reading it that are Brits or non-European citizens. However, you must understand that I am Portuguese, and therefore, my point of view is from a European citizen.
The recent crisis has seen a new side to what the bases of the EU are. As Europeans, we are supposed to ‘have each other’s back’. We are the biggest organization in “The Old Continent”. The union of small counties that decided to team-up to beat the American giant and the Chinese giant. We stand for Human dignity, Freedom, Democracy, Equality, Rule of law and Human rights.
After the short 27 years that the EU has been ‘alive’, we have been through the “dot com crisis”, the Great Recession, the debt crisis, the migrant crisis and others. Now, credit where credit is due, excluding the debt crisis, none of these crises you can trace back to the EU. Meaning, it was not the EU’s fault. The issue arises when the EU is facing said crisis and completely letting itself down. We are focusing on the economic crisis of 2008 and the following debt crisis.
The crisis of 2008 hit the Europeans in 2008, just like the rest of the world, with a massive crisis in the market. But for some countries, because their business is not as exposed to the American market as much as the southern countries, Italy, Spain, Portugal and Greece, he crisis only came for them in 2011 with the accumulated debt. These countries have many reasons to have debt, but one big reason was the directions EU set right after the crisis in 2008: spend, spend and spend. Countries that have weaker economies did that, and those bad investments that were completely recommended by the EU backfired to the point that these countries needed to borrow some money internationally just so they could pay salaries.
I understand the thought of it. Spend money on the economy, raise wages and people will consume more. Companies will make more money because of the extra consumption and will be able to raise profits for the companies who will themselves re-raise wages. The problem with this is that we just came out of a recession and the economic system was fragile and was not capable of doing that. The consumer simply absorbed the extra money from the first rise of wages, and it killed the economic circle. Today, living in the pandemic age, we see that Europe is telling its members to do, you guessed it, spend, spend and spend.
This is a second chance for Europe to out-do themselves after 2011.
I have also previously defended that borders should be closed and that counties should run a budget deficit in order to make sure the economy is stable, functioning and to make sure that all health services are at their best. Since all countries will need to do that, it makes sense to do that as a unit. To do that as a European Union. It is better because if we do it as a unit the interest rate will be lower as opposed to if every country does it by themselves. However, countries such as Austria, Finland Germany and The Netherlands are opposing the idea. This would not be a problem if the EU was a majority rule union as opposed to what it is where you need to have each of the 27 approval to do anything.
Unfortunately, these actions are very damaging to the European-feel that the union has tried to create. It even makes us resound the comments by the then president of the Euro-group in 2017, Jeroen Dijsselbloem, said about the southern counties: “As a Social Democrat, I attribute exceptional importance to solidarity. (But) you also have obligations. You cannot spend all the money on drinks and women and then ask for help”. These typical mistakes are one of the many euro-sceptics arguments. We cannot afford in this point in time.
I am, still, a believer in the European Union. However, the more I find out about it the less I am a believer. If Eurobonds do not go through with a pandemic, I might even start considering a Portu-xit because it completely goes against the union values’ stands for. This is a crucial point to Europe. It needs, more than ever, to show its strength and unity, especially after Brexit. I am not certain if Eurobonds are the solution to this pandemic, but I am sure that Europe needs to unite to meet this challenge together.