Crisis Challenges and the EU Economic-Political Stability

Abstract

This paper will explore some of the economic and political challenges that European institutions will have to address in the short- and medium-term in order to prevent the continuation of the economic crisis and political destabilization of the Community. These challenges have been gathering force and importance since the outbreak of the financial-economic crisis, however their true source can be traced to contractual and institutional foundations of the Union, as well as its economic policy over the past twenty years. Economic challenges include the strain on the integrity of the eurozone, the loss of competitiveness in Europe’s peripheral economies, the rise of protectionist tendencies, and the necessity of developing a more efficient mechanism of economic management of the whole EC. Political disintegrational challenges include the rise of inequality between labor and capital, the increase in number of unemployed and poor people, the democratic deficit of European institutional structure, the growing hostility towards economic globalization, neoliberal economy and EU accession of new countries, and the transfer of political and economic power from the western into the eastern parts of the planet. The EU will not be able to surmount these challenges if it does not abandon its neoliberal economic policy and eliminate the democratic deficit in European institutional decision-making.