Europe in 2012
Posted: Monday 23 Jan 2012
Europe in 2012 will feel the effects of 2011
Undoubtedly, 2011 was a tough year for Europe. Two issues stood out: migratory pressures from North Africa and the Eurozone crisis. Immigration from the “Arab Spring”, and fiscal strain due to the Euro’s problems. Both events combined to severely test European institutions.
Both major events of 2011, and the problems they raised, will impact Europeans well into 2012. On the Eurozone crisis, I’m optimistic that European politics and institutions have been positively challenged into a finding a lasting solution. But regarding the explosion in anti-immigrant politics during 2011, and the far-right boon that resulted in many countries, I believe 2012 will prove as dangerous a year for Europe’s attitude to migrants, diversity and other cultures.
On the Eurozone crisis, one thing is clear. The litmus test for European prosperity is the success of the single currency. Let us be under no illusions, 2011 saw the Euro stretched almost to breaking point. Governments in Greece, Italy and Spain fell, and emergency administrations were put into place. German-Greek relations cooled, as domestic politics in each country became white hot on the issues of bailouts from the centre, and austerity at the periphery. But the Euro is surviving.
European leaders understood the essential problem with the much touted proposition that Greece leave the Euro as a solution. It is simple. There is no way for a country to leave the Euro without causing unprecedented economic dislocation in the rest of Europe. This includes those European countries not members of the Eurozone, such as the United Kingdom. During 2011, not all agreed. There was ongoing clamour for a Greek exit from the Eurozone currency. The argument for a Greek exit was straightforward. Some form of default followed by a restored Drachma, the old Greece currency, devaluing the currency and pulling Greece back to competitiveness.
It’s important to understand that this idea was wrong. Following any form of exit from the Euro in 2011, Greece would have experienced an unprecedented bank run. Greek debt is in Euros and will remain in Euros, even if subject to partial write offs. Plus, whatever advantages for Greece of an export-promoting return to a weaker currency would have been lost, as Europe more widely would enter recession as a direct result of a Greek exit. Other European countries, Greek trading partners, would have followed Greece into financial ruin, given their exposure to Greek debt and the questions over the Euro that would result from any Greek exit.
Resisting this disastrous outcome was a major achievement of European leaders in 2011.
However, regarding migratory upheavals following the Arab Spring, a number of issues were raised by the influx of people desperately fleeing to Europe. Two of these issues were interrelated, the response by European governments to the migrant influx, and the inspiration taken by the European far-right from that response.
In 2012, fear a normalization of the “not my problem” approach to people who fled brutality in North Africa. We saw this in 2011, with Italy passing migrants to France, and far-right influences in Denmark successfully lobbying to close that nation’s borders in response, rejecting passport free travel in contravention of EU law.
2012 will see this challenge at its heart, one born of 2011: a lingering recession in Europe that, while being slowly fixed, could allow the far-right a once in a generation chance to normalize their agenda.
Posted by: Admin on Monday 23 Jan 2012
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