Foreclosure Related Crisis Has Made Visible the Cracks in EU

April 15th, 2009 | Tags: Foreclosure Crisis

Behind the bonhomie of the G-20 partying there are fissures. It is the foreclosure related crisis that has made visible the cracks in the European Union. The world has been looking up to the G-20 meet to pull it out of one of the worst economic slumps.

Disarray has been nothing new to the EU but the recent happenings that snowballed with the foreclosure crisis in USA have brought this into prominence. Since its birth in 1957 with the inking of the Treaty of Rome the EU has never faced such a grave crisis.

The confusion within the members is highlighted by the weaknesses of the leaders representing their country. British premier Gordon Brown is certain to fail in the next general elections. Worse still – many of his countrymen think him to be the architect of this crisis. Thus how can Brown be considered a part of the solution?

Angela Merkel of Germany without doubt holds on to the strongest seat. France’s Nicolas Sarkozy is lucky that the opposition is in confusion in his country but his popularity is at an all time low. Silvio Berlusconi position is nothing new – disarray in Italian politics is the norm rather than the exception.

The position of Mirek Topolanek of the Czech Republic is the most ironical of all. He had described the American reaction to the financial crisis as the “road to hell”. But he will be the lame duck in the London summit as he has lost power at home just at this crucial point and overthrown with a non-confidence vote.

The mandate of Commission President Jose Manuel Barroso runs out within a couple of months and there are grave doubts about his reinstatement.

Thus the disunion and disarray will make these leaders concentrate on their domestic problems rather than take a comprehensive view of world economics and global administration. Never before has the EU been more like a chattering Tower of Babel with none understanding the other. There are now 27 members coming from diverse countries causing more noise than music. The Franco-German axis does not have the same clout as before when the seats were occupied by the likes of Charles de Gaulle, Konrad Adenauer, Helmut Schmidt, Mitterand etc. At the highest noticeable pitch is the hostility between Merkel and Sarkozy.

The paradox highlighted is that while the European Union talks about protectionism being the greatest danger to world economy they are each taking protective measures against each other!