Why Europe Won't Disintegrate

Two – seemingly diametrically opposed – conclusions have been drawn from the outline European Union agreement to reform the governance of the Euro-area following the crises which have recently hit Greece, Ireland and Portugal. The first is that the 17-nation single currency Euro-area – the core of the wider 27-member-state EU – is now becoming an economic and not merely a monetary union, and thereby moving closer to de facto political union.[1] The second conclusion is that the EU's failure to agree a lasting solution to the problems afflicting some of the Euro-area peripheral economies might yet undermine the entire single currency system. And this could, some claim, taken together with a range of other problems afflicting the Union, eventually threaten the EU itself. Both these conclusions contain important truths. But they are less contradictory than they at first appear. The European Union faces a whole series of problems that impel member states to integrate still further or risk a gradual unravelling of what has already been achieved. But with every step forward opposition from Euro-sceptic populists and nationalists grows shriller. How will these contradictions be resolved?