Pretty much the only thing in the news since I arrived in the UK is the Eurozone debt crisis. The problem is clear: single currencies can only work if either one state economically
dominates all others such that the currency is resistant to any
difficulties experienced by the minor states, or if there is a federal
government able to control all the constituent states in order to
balance differences in economies. The Euro had neither of these so states tried to balance the economic inequalities themselves through debt. Since 'the market' is shortsighted to the point of being nearly blind they were able to accrue far more debt than they could pay back.
The only solution is to rectify the original problem, either eliminate the single currency or set up a federal government. Eliminating the single currency would cause a panic in the markets and a huge mess all round; as well as, undoing the ease of trade that the EU has enjoyed. Where as, setting up a federal government is a slow and tricky process.
The USA create theirs through war, first with the UK during the revolutionary war, and then again with the themselves during the civil war. However, Canada managed to create a strong federal union without shedding a drop of blood. The chief problem with most of the proposals for a stronger EU is that they are undemocratic. The countries of the EU and their people are used to democracy, citizens expect to have their say in the decisions that affect their lives. Thus, to be seen as legitimate a federal government must be democratic as well. Without perceived legitimacy the government will be unable to enact/enforce tough/unfavourable measures (even if they are in the interest of the EU as a whole) without provoking riots. As we have seen in London and Greece it is tough enough for democratically elected leaders to make those decisions.
Finally we come to the most current topic, the UK and its place in the EU. Since the UK does not use the Euro there is no necessity for the UK to be a part of a Eurozone federal union. They can choose to be part of the Eurozone federation and lose much of their sovereignty in exchange for closer economic ties and political power. Alternatively they can stay out and end up like Canada, sitting next to a sleeping elephant, at the mercy of the Eurozone state with little influence on it but with their sovereignty intact.
