The current financial crisis surrounding Greece has the European Union (EU) reliving an American nightmare of the 1780s. Then, the Articles of Confederation bound the thirteen states together with ties that were both loose and clumsy, and that failed. The parallels are plain:
- A group of states join together for mutual advantage.
- History and pride require that the union not be too close! No one wants to give up political autonomy.
- The organizational charter requires unanimity — that’s right, unanimity — to adopt critical economic policies. In America in the 1780s, it was allowing the national government to levy a tax on imports; in Europe now, it’s the bailout plan for Greece.
- A crisis arises: In America in the 1780s, it was the inability to repay our debts. In Europe today, it’s . . . Greece’s inability to pay its debts! (Are you still with me? This is working.)
- One of the smallest, least significant members of the union holds out. In the 1780s, it was Rhode Island. Rhode Island! Today, in the Greek crisis, it’s Slovakia which refuses to go along. (This structural arrangement — known in history as the liberum veto — was a characteristic of the Polish-Lithuanian Commonwealth, which collapsed; not really a “best practices” model.)
The EU was created by treaties among the member states, culminating in a Constitution of 2004. It has achieved an amazing amount. The Euro, as a currency, plainly makes trade and travel in Europe incalculably easier. As a traveler who has gazed enviously at Europeans scampering through no-customs lines at European airports, I have admired their progress in breaking down barriers between states. But the current crisis is showing the severe limitations of the current governance arrangements. It’s time for some change.
We could offer the use of Independence Hall in Philadelphia, but they will have to provide their own James Madison and George Washington figures. Ours have long since left the building.