Out of the big three, China, the USA and the EU. the EU has by far the worst form of governance. it has neither the benefits of a centralized state, nor the benefits of a decentralized system. it's really just a money sink and even worse, an extra layer of regulations that makes doing business impossible.
the founders of the EU never intended for the EU to be the EU. they intended for the EU to become one superstate. What we have now is just so dysfunctional, and it's funny nobody in charge can see how broken it is. But if you ask your average indigenous european on the street, they know.
Well said. The UE has failed. It has not became a really union. At the same time, it has damaged the political independence of each State. So: the profits of independece of each State has been lost without the profits of a really union.
There is a class of people with profound business incompetence but addicted to positions of power. They are looting, rent-seeking charlatans that achieve degrees to mask their defects. The massive problem in the West is that we have allowed them to take control. In the US and Canada the people are finally committed to purge at least some of this bureaucratic rot. The EU is a lost cause as it is all rot.
The EU has virtue signaled its energy suicide and has now way out from its current management. Germany is a basket case and how the citizens have permitted this insanity will be one of those great debates that harken back to the 1930’s. The EU seems dead set on making itself subservient to the remaining super economies.
In the future we can see two roads. The first consists into an attempt of every State to look for himself (Hungary or Serbia with chinese cars; Italy taking Algerian gas that "belonged" to Spain; Austria or Slovakia trying to ensure direct gas supply from Russia; Norway doing this, that is something that they always have done). That will be the logical behave if we look the damage that regulations has made to most States (here, in Spain, the damage of this regulations on agriculture and in the industry done in the 90 and 00, it has been strong). This will come with nationalism, and all the nationalism will confluence on the issue of migration.
If this happen, we can bet that for some countries will be good; but, do the situation of the world, the winners just can be a few. The States that more quickly move on this direction (Hungary, Italy, Austria...) could take a crucial advantatge.
The second road it is doing things like now. I can not see by any chance a real union. For the States that choose the first road will be very difficult to "jump" on the regulations that has been created and accepted by the States. ¿How will be the attempts of breaking those regulations? I don't know, and will be one main factor.
There is a lot of intereses of various groups (companys, burocracies, cultural, academical...) that will "fight". We can think how a few sectorial companys prefere to still in the UE like now, and others prefer to move to the first road. That will create a "cultural battle" with polaritzation and ideology for justify their interests.
It will came busy and rough times, and their will have the mentioned "cultural battle" as an arm for convincing the masses.
I agree that there is little chance the EU can reverse course. In fact, perhaps the only viable way forward is to completely dismantle the EU as currently configured and go back to a free trade bloc. It will be very messy as all those currencies will need to make a comeback but the problem seems to be that some bad decisions, like Germany’s Energiewende, are dragging down the whole edifice
The 800lb Gorilla in the Living Room which I have almost never seen discussed, and which accounts for almost all these catastrophic outcomes, is the personal situation of the bureaucrats. When most outsiders hear the term, they perhaps think of lazy, little gnomes, secure in their cubicles, etc. Basically, a burden societies can do without, but which we are doomed to put up with, a cost of doing business.
In Europe, the bureaucrats ARE the Elite: the average pay and benefits package is around $500K for the plebes, and far higher for the higher-ups. None of that money is subject to the sky-high income taxes in the member countries. At retirement, the gravy train continues until death. In addition, the bureaucrats live in the NICEST apartments, at taxpayer expense, and their daily expenses are all paid for. They pay for nothing. It is almost incomprehensible for an American to understand.
In most European countries, the number-one goal of ambitious young people is to get one of these government jobs.
It takes only a very rudimentary knowledge of how incentives influence human behavior to see that any solutions will NEVER come from these bureaucracies. They have far too much to lose.
Great article. I suggest that the EU’s lack of economic progress since the GFC may have something to do with the response to that crisis essentially being to slap some plaster over the cracks in the foundation and pretend that everything was fixed. Also, those cheap, green and clean energy sources that Draghi was talking about have yet to be invented.
Also, if the EU does split up, what happens to the euro? Does everyone go back to their old fiat currencies? What effect would that have, I mean, apart from creating a bunch of new central bank gigs for Goldman Sachs alumni?
Good summary. I’d only add that leaving the EU, while potentially desirable, is clearly insufficient to catalyse real change-the UK’s energy policy (if I can call it that) testify to that.
And while I agree with Boogaloo that the EU is a weak form of governance, I disagree that the problem facing Europe is solely due to the EU. After all, Germany chose for itself to dismantle its nuclear energy source, a policy France declined to follow.
Europe needs a coordinating body that creates some uniformity among the nations of Europe. This had to be done in the face of nations that refused to give up their sovereignty (distinguishing them from our states that begrudgingly gave up their sovereignty to form our more perfect Union).
While it's true that Europeans do not vote for their EU representatives, those representatives follow the mandates from the national governments that selected them (much like state legislatures selected their Senators prior to 1913 (17th Amendment)). If the EU has unattractive policies, it is not simply because it is a large bureaucracy, but to a large degree it in fact represents the general views of Europeans.
I won’t attempt excusing the EU and its myriad and incomprehensible directives and decisions.
I will though, make a couple points I think important.
Gas flow in Nordstream was shut by Russia, in response to the early sanctions for the invasion of Ukraine.
Since then, the EU, and its largest economies, especially Germany, France, Italy, Poland, and others, if not all, (Hungary is led by a Putin pal) have decided that doing business with Russia is to be curtailed and ultimately reduced as far as possible.
This is a political decision, and the ramifications will ultimately be assessed at the ballot box.
In the meantime, I think it’s in everyone’s interest, at least those opposed to Putin’s current ambitions of building a greater empire, and bolstering his legacy, (now in ruins imo) to, if not applaud the EU for the sacrifices, then at least acknowledge them and be supportive.
Armchair quarterbacking geo-political events requires a bit more nuance and context than much of what is said here. In my opinion. TY.
Draghi’s paper is about recovering competitiveness all along its, close to, 400 pages. I doubt you read them.
“Cheap gas from Russia “ means dependence from a hostile, volatile and aggressive neighbour, with nukes. Would the US buy 40% of its energy needs from Maduro’s Venezuela? Of course not.
The phase-out of ICE cars is supported by the majority of the EU population and the majority of car producers in Europe. Are you paid by Stellantis or Shell?
One big catalyst element will be - if they are successful - the Milei and Trump administrations. If the Europeans voters see that these two outsiders’ agenda are successful, they will ask for European versions of it.
a parasite eventually kills the host
Out of the big three, China, the USA and the EU. the EU has by far the worst form of governance. it has neither the benefits of a centralized state, nor the benefits of a decentralized system. it's really just a money sink and even worse, an extra layer of regulations that makes doing business impossible.
the founders of the EU never intended for the EU to be the EU. they intended for the EU to become one superstate. What we have now is just so dysfunctional, and it's funny nobody in charge can see how broken it is. But if you ask your average indigenous european on the street, they know.
Well said. The UE has failed. It has not became a really union. At the same time, it has damaged the political independence of each State. So: the profits of independece of each State has been lost without the profits of a really union.
Best quote: “decouple growth from resource and energy use.” That’s like saying “decouple life from eating and breathing.” Yeesh.
scary when you think Europe used to rule the world.....America take notes
The EU is as it is partly due to the americans. We are basically under occupation.
There is a class of people with profound business incompetence but addicted to positions of power. They are looting, rent-seeking charlatans that achieve degrees to mask their defects. The massive problem in the West is that we have allowed them to take control. In the US and Canada the people are finally committed to purge at least some of this bureaucratic rot. The EU is a lost cause as it is all rot.
Yes, there is no hope--and I say that with complete dispassion.
The EU has virtue signaled its energy suicide and has now way out from its current management. Germany is a basket case and how the citizens have permitted this insanity will be one of those great debates that harken back to the 1930’s. The EU seems dead set on making itself subservient to the remaining super economies.
In the future we can see two roads. The first consists into an attempt of every State to look for himself (Hungary or Serbia with chinese cars; Italy taking Algerian gas that "belonged" to Spain; Austria or Slovakia trying to ensure direct gas supply from Russia; Norway doing this, that is something that they always have done). That will be the logical behave if we look the damage that regulations has made to most States (here, in Spain, the damage of this regulations on agriculture and in the industry done in the 90 and 00, it has been strong). This will come with nationalism, and all the nationalism will confluence on the issue of migration.
If this happen, we can bet that for some countries will be good; but, do the situation of the world, the winners just can be a few. The States that more quickly move on this direction (Hungary, Italy, Austria...) could take a crucial advantatge.
The second road it is doing things like now. I can not see by any chance a real union. For the States that choose the first road will be very difficult to "jump" on the regulations that has been created and accepted by the States. ¿How will be the attempts of breaking those regulations? I don't know, and will be one main factor.
There is a lot of intereses of various groups (companys, burocracies, cultural, academical...) that will "fight". We can think how a few sectorial companys prefere to still in the UE like now, and others prefer to move to the first road. That will create a "cultural battle" with polaritzation and ideology for justify their interests.
It will came busy and rough times, and their will have the mentioned "cultural battle" as an arm for convincing the masses.
PD: Sorry for my English. I hope it is clear.
I agree that there is little chance the EU can reverse course. In fact, perhaps the only viable way forward is to completely dismantle the EU as currently configured and go back to a free trade bloc. It will be very messy as all those currencies will need to make a comeback but the problem seems to be that some bad decisions, like Germany’s Energiewende, are dragging down the whole edifice
The 800lb Gorilla in the Living Room which I have almost never seen discussed, and which accounts for almost all these catastrophic outcomes, is the personal situation of the bureaucrats. When most outsiders hear the term, they perhaps think of lazy, little gnomes, secure in their cubicles, etc. Basically, a burden societies can do without, but which we are doomed to put up with, a cost of doing business.
In Europe, the bureaucrats ARE the Elite: the average pay and benefits package is around $500K for the plebes, and far higher for the higher-ups. None of that money is subject to the sky-high income taxes in the member countries. At retirement, the gravy train continues until death. In addition, the bureaucrats live in the NICEST apartments, at taxpayer expense, and their daily expenses are all paid for. They pay for nothing. It is almost incomprehensible for an American to understand.
In most European countries, the number-one goal of ambitious young people is to get one of these government jobs.
It takes only a very rudimentary knowledge of how incentives influence human behavior to see that any solutions will NEVER come from these bureaucracies. They have far too much to lose.
Exactly - the only people who can change the status are the ones who are going to lose. What's the expected outcome?
Great article. I suggest that the EU’s lack of economic progress since the GFC may have something to do with the response to that crisis essentially being to slap some plaster over the cracks in the foundation and pretend that everything was fixed. Also, those cheap, green and clean energy sources that Draghi was talking about have yet to be invented.
Also, if the EU does split up, what happens to the euro? Does everyone go back to their old fiat currencies? What effect would that have, I mean, apart from creating a bunch of new central bank gigs for Goldman Sachs alumni?
Yes, I largely agree with you. The EU experiment in centralization is not working out.
The EU refuses to reform and feels like it can control the nation-states. It has left skeptics few alternatives but to withdraw.
I go into more detail here:
https://frompovertytoprogress.substack.com/p/the-european-union-has-gone-too-far
thanks for adding!
Good summary. I’d only add that leaving the EU, while potentially desirable, is clearly insufficient to catalyse real change-the UK’s energy policy (if I can call it that) testify to that.
Excellent report on issues facing the EU.
And while I agree with Boogaloo that the EU is a weak form of governance, I disagree that the problem facing Europe is solely due to the EU. After all, Germany chose for itself to dismantle its nuclear energy source, a policy France declined to follow.
Europe needs a coordinating body that creates some uniformity among the nations of Europe. This had to be done in the face of nations that refused to give up their sovereignty (distinguishing them from our states that begrudgingly gave up their sovereignty to form our more perfect Union).
While it's true that Europeans do not vote for their EU representatives, those representatives follow the mandates from the national governments that selected them (much like state legislatures selected their Senators prior to 1913 (17th Amendment)). If the EU has unattractive policies, it is not simply because it is a large bureaucracy, but to a large degree it in fact represents the general views of Europeans.
you either form a centralized state, or not, this middle of the road stuff doesn't work.
That was definitely our experience. It's tough to square the circle.
I won’t attempt excusing the EU and its myriad and incomprehensible directives and decisions.
I will though, make a couple points I think important.
Gas flow in Nordstream was shut by Russia, in response to the early sanctions for the invasion of Ukraine.
Since then, the EU, and its largest economies, especially Germany, France, Italy, Poland, and others, if not all, (Hungary is led by a Putin pal) have decided that doing business with Russia is to be curtailed and ultimately reduced as far as possible.
This is a political decision, and the ramifications will ultimately be assessed at the ballot box.
In the meantime, I think it’s in everyone’s interest, at least those opposed to Putin’s current ambitions of building a greater empire, and bolstering his legacy, (now in ruins imo) to, if not applaud the EU for the sacrifices, then at least acknowledge them and be supportive.
Armchair quarterbacking geo-political events requires a bit more nuance and context than much of what is said here. In my opinion. TY.
don't believe the propaganda dude. the west provoked this war and wanted this war.
Germany had a deal with Russia to pump gas through Nordstream. Russia shut it off.
That’s a fact you can easily look up.
After that, we can each have our own ideas about the mess in Eastern Europe.
Dear John
What a stack of nonsense you have just vomited!
Draghi’s paper is about recovering competitiveness all along its, close to, 400 pages. I doubt you read them.
“Cheap gas from Russia “ means dependence from a hostile, volatile and aggressive neighbour, with nukes. Would the US buy 40% of its energy needs from Maduro’s Venezuela? Of course not.
The phase-out of ICE cars is supported by the majority of the EU population and the majority of car producers in Europe. Are you paid by Stellantis or Shell?
Try again, but think better
Excellent piece on a very sad theme. Sadly, it will take a long time to dislodge the current Brussels nomenclatura...
One big catalyst element will be - if they are successful - the Milei and Trump administrations. If the Europeans voters see that these two outsiders’ agenda are successful, they will ask for European versions of it.