Structural Constraints and European Crisis

Abstract

Europe at Bay: In the Shadow of US Hegemony. By Cafruny Alan W., J. Magnus Ryner. Boulder, CO: Lynne Rienner, 2007. 169 pp., $18.95 (ISBN-13: 978-1-58826-537-1). Europe at Bay is a provocative book that directly challenges the dominant perspective regarding the place of the European Union in the global arena. This view, represented by a wide array of literature from popular bestsellers (Reid 2004 and Rifkin 2004) to more scholarly treatments (McCormick 2006) heralds a new era when the European Union not only challenges US hegemony, but actually supplants it in many non-military realms. Even with regard to the role of the dollar as the world's dominant currency, it is noteworthy that analysts are speculating about the future of the euro as a significant rival (Hosli 2005). In this book, Cafruny and Ryner make a compelling case for a different view, however, on that is far more pessimistic about the ability of the European Union to break away from its dependency on the US, let alone break new ground in European and global affairs. Their central argument, much in line with Dependency Theory, is that the structures of global finance favor the US and that US Neo-Liberal ideology has permeated the European financial elite in direct contradiction to longstanding political commitments to the European social model. The Economic and Monetary Union (EMU), which resulted in the creation of the euro, has highly supranational features which are embodied in the European Central Bank and its monetary policies. European monetary policies are Neo-Liberal in their orientation, and this, the authors claim, is due to the importation of US Neo-Liberal ideologies and the desire for European exchange rate stability in reaction to the dominance of the dollar and its volatility in the 1970s. Moreover, the central bankers that designed the EMU serve primarily “economic management” and not “societal legitimation,” pursuing monetary policy that is oriented toward capital accumulation in reaction to US led policies (p. …