The European Union comprises 27 member states that all joined, it can be argued, of their own volition, and for largely political reasons. Finland, Austria, Italy, Greece, Portugal, Slovenia, and 21 others, chose to abandon the markka, schilling, lira, drachma, escudo, koruna, and 21 other currencies and joined the EU after weighing the benefit of monetary independence against the benefit of monetary union. No member has yet left, but commentators suggest that at least one should.
Leaving the EU, legally speaking, is an easy question. Article 50 of the Lisbon Treaty answers it unambiguously, in addition to providing for a state’s re-entry into the EU. In short, a withdrawing member must negotiate the terms of its exit with the European Council, including its future relationship with the EU. After “obtaining the consent of the European Parliament,” the European Council can allow a member state to exit. Simple enough.
Of course, the real focus of commentary about a member state’s possible exit from the EU is financial, not legal. In October, British Baron Leonard Wolfson announced an award of $400,000 to anyone who best articulates “the orderly exit of one of more member states from the European Monetary Union.” To win, a submission must describe (in about 30,000 words) how to ensure the stability of any new currencies, the areas new currencies will cover, what currency government debt would be paid back in, and what happens to individuals’ debts. The deadline is January 31, 2012.
The Prize comes with serious provisos—for instance, that the reviewing committee can decline to award any contestant—but underscores the incursion of the managerial mindset into political decision-making. Although the EU was born of an essentially political series of decisions, commentary about it centers on its relationship with faceless markets, not with discernible political actors. If it does discuss the latter, it’s to elucidate the supposedly more important questions of monetary (and possible fiscal) union. What is then the role in the EU of elected leaders? What of leaders elected by member states with sovereign debt crises? Do voters of member states forfeit their right to fiscal self-determination if their economy happens to have languished? Is the EU a mechanism by which member states contract away their popular sovereignty? Does the EU necessarily erode democratic legitimacy? Is the EU incompatible with the will of majorities in member states? While I don’t have an extra $400,000 to spend, I’ll buy anyone coffee (or a healthier drink) who will answer these questions.