The European Union (EU)

The World’s Strongest

Supranational Organization
 What is it?
• The European Union (EU) is a family of democratic
European countries, committed to working together
for peace and prosperity.
• It is not a State intended to replace existing states, but it
does represent a greater compromise of sovereignty
than any other international organization.
• The EU is unique; its Member States have set up
common institutions to which they delegate some of their
sovereignty so that decisions on specific matters of joint
interest can be made democratically at European level.
• This pooling of sovereignty is also called "European
integration" 
European Coal and Steel
Community
• Founded in 1951
(Treaty of Paris)
• Purpose was to
reduce potential for
conflict between the
member states by
pooling vital
resources
• Fore-runner of the
EEC, EC, and EU
 History of the EU
• The historical roots of • Phases of growth
the European Union – Initially, the European Economic
lie in the Second Community (EEC) consisted of just
World War. six countries: Belgium, Germany,
– Idea of European France, Italy, Luxembourg and the
integration conceived Netherlands (1958)
to prevent such killing
and destruction from – European Communities (EC) (1967)
ever happening again – Denmark, Ireland and the United
– First proposed by the Kingdom joined in 1973
French Foreign – Greece in 1981
Minister Robert
Schuman in a speech – Spain and Portugal in 1986
on May 9, 1950. This – European Union (EU) (after 1992)
date, the "birthday" of (Maastricht Treaty)
what is now the EU, is
celebrated annually as – Austria, Finland and Sweden in 1995
Europe Day – Largest enlargement took place with
10 new countries joining May 9, 2004
 GROWTH OF THE EU

Admission
of Romania
and
Bulgaria
2007

Croatia and
Macedonia
are new
candidates

Major
debates
about
Turkey
 EU Member Countries
Austria Latvia
Belgium Lithuania
Bulgaria Luxembourg
Croatia Malta
Cyprus Netherlands
Czech Republic Poland
Denmark Portugal
Estonia Romania
Finland Slovakia
France Slovenia
Germany Spain
Greece Sweden
Hungary United Kingdom
Ireland
Italy
 Euro Area Member
Countries
Austria. Belgium. Cyprus.
Estonia. Finland. France.
Germany. Greece. Ireland.
Italy. Latvia. Luxembourg.
Malta. Netherlands. Portugal.
Slovakia. Slovenia. Spain 
 How does it work?
• There are five EU institutions, • These are flanked by five other
each playing a specific role: important bodies:
– European Parliament (one of two – European Economic and Social
legislative bodies in the EU; Committee (expresses the
elected by the peoples of the opinions of organized civil society
Member States)  on economic and social issues)  
– Council of the European Union – Committee of the Regions
(EU’s highest Legislative Body; (expresses the opinions of
has legislative initiative; is made regional and local authorities)  
up of representatives appointed – European Central Bank
by member states according to a (responsible for monetary policy
population-based allotment)  and managing the euro)  
– European Commission (EU’s – European Ombudsman (deals
executive body; one with citizens' complaints about
commissioner per country maladministration by any EU
appointed by each government)  institution or body) 
– Court of Justice (ensures – European Investment Bank
compliance with the EU laws)  (helps achieve EU objectives by
– Court of Auditors (manages the financing investment projects) 
EU budget)
 The Euro
• The Treaty of Rome (1957)
– Declared a common market as a European objective
– Aim: increase economic prosperity and contribute to "an ever
closer union among the peoples of Europe"
• The Single European Act (1986) and the Treaty on
European Union (1992) built on this
– introduced Economic and Monetary Union (EMU)
– laid the foundations for a single currency
– name “Euro” was selected in 1995
– in January 1999, the exchange rates of the participating
currencies were irrevocably set and Euro area Member States
began implementing a common monetary policy
– in January 2002, 12 States in the EU introduced the new euro
banknotes and coins
 The Eurozone
• Coins and banknotes 1st used
Jan 1, 2002
• Cyprus sheduled to join in 2008
• Slovakia scheduled to join in
2009
• Estonia scheduled to join in
2010
• Sweden is technically obliged
to join but the EU has made
public that they will not enforce
this with regard to Sweden
• Britain and Denmark have a
“derogation” releasing them
from having to join
 Impact of the Eurozone
• What impact do you think the Eurozone
has on cultural diffusion?
• What impact do you think the Eurozone
has on economic development?
• Why are some countries avoiding joining?
A strong currency!
Why have bills different
sizes & colors?

What values are

reflected in these
“artifacts” that are not
found in American
money?
Coins
 Advantages to joining
the EMU
• European countries saw the adoption of
the Euro as a way of creating world wide
competition
• Integrate the European nations makes the
union a strong world power

• World Balance
 Advantages to joining
the EMU
• Strengthen Banking System

• European Central Bank would provide

an institution of monetary regulation
comparable to the FED

Ex) 6 member Executive Board of the

ECB acts much like the US 7 member
FED reserve board
 Advantages to joining
the EMU
• The Euro would advance one’s
international trade

• Way to challenge the power of the US in

foreign exchange

• Inspire exporters to denominate their

goods in euros as well as dollars
 Advantages to joining
the EMU
• Company can create individualities with
different prices
• Single Monetary Policy
 Disadvantages to
joining the EMU
• Introduction of a single monetary policy
among 12 individual national policies of
each country
• Before joining the country controlled it’s
own money supply

• Monetary decisions with economic and

national policies unique for the
circumstances of the country
 Disadvantages to
joining the EMU
Ex) Monetary policy for France and
Germany could prove very costly for Spain
and Portugal

• Surrender their individual policies on

inflation,unemployment, and economic
growth
 SUMMARY
• The European Union is the strongest supranational organization in
the world
– shared currency & financial management
– legislative, judicial, and executive bodies
– regulatory and planning bodies
• The EU is growing geographically, and its growth suggests a core-
domain model
– core and domain are borne out by distribution of income
• The EU does not appeal to all Europeans (at least not yet)
– small states in particular seem skeptical
• Roughly comparable to the US in some ways
– population slightly larger than that of the US
– somewhat more densely settled than the US
– economy is at least as strong as the American economy
– other social statistics (e.g. literacy, infant mortality & homicide) are as
good or better than the US