Brexit

[Muddy Retriever]

So we need an EU fiscal union then? (lights blue touch-paper)

Certainly the eurozone needs a fiscal union. The problem is that there appears to be little enthusiasm for it among the member states. As Oracle and WP have said it is unlikely that Germany will wear it. Mrs Merkel has to answer to her electorate and while the West Germans could tolerate a mass transfer of wealth to their fellow Germans in the east to achieve unification they don’t feel the same way towards Greeks and Italians. By the same token the Southern Europeans don’t want their lives controlled by the northern states.

And therein lies the nub of it. The idea of the nation state as opposed to a supranational organisation remains resilient and not just here in the UK. Fiscal transfers are accepted between richer and poorer regions with scarcely a grumble because rightly or wrongly there is a perceived shared identity. This doesn’t exist between the nation states of the European Union. I think the resistance to the idea of a political and fiscal union is why the EU didn’t set it up before they launched the euro in the first place.

[noel]

Certainly the eurozone needs a fiscal union. The problem is that there appears to be little enthusiasm for it among the member states.

You're right there is little enthusiasm for a fiscal union among the member states, and am I right in saying it would take a unanimous decision? So is it scaremongering to say that the EU is moving towards a superstate? Or are there other moves afoot to which you leavers are against?

[Witton Park]

You're right there is little enthusiasm for a fiscal union among the member states, and am I right in saying it would take a unanimous decision? So is it scaremongering to say that the EU is moving towards a superstate? Or are there other moves afoot to which you leavers are against?

And this is why I believe the EU regardless of Brexit stands at a cross roads.

We often hear in the UK talk about what we signed up to in the 70s when we accepted membership of the Common Market.

How will the wealthier Euro nations react if they are now told that to maintain the Euro they will have to agree to fiscal transfers to the less well of regions and nations?
I suspect they will say "we didn't vote for this...."

On the unanimity, I'm not sure. I have read that the reason there hasn't been another treaty since Lisbon (they used to be every 4-5 years) is that Lisbon had the tools already within it for the EU to draw in competence in areas it didn't previously have and also for the ability of a nation to veto to be gradually eroded.
Now that might be untrue, or exaggeration, but I have seen it from some serious journalists, not just the regular space cadets you find on social media.
Certainly there are levers the EU can pull to put (say) a small nation like Ireland under pressure over it's Corporation Tax rates that might render the Tax Veto Ireland has useless.

[Muddy Retriever]

You're right there is little enthusiasm for a fiscal union among the member states, and am I right in saying it would take a unanimous decision? So is it scaremongering to say that the EU is moving towards a superstate? Or are there other moves afoot to which you leavers are against?

Germany and France are the main power players within the eurozone and at the moment they disagree on the best way forward. Come the next recession (which may not be far away) the need for political/fiscal union will probably become more acute. Failing that I think there is a good chance that the eurozone will break up. One possible solution might be for a small group of northern states led by Germany to break away and form their own currency zone. The value of the rump euro would inevitably fall bringing instant relief. This is better than countries like Italy or Greece reverting to their own currencies since their debts would still be denominated in euros and therefore be much higher as their own currencies devalued.

I was surprised by your assertion that it might be scaremongering to say that the EU is moving towards a superstate. The Commission makes no secret of it, it has been the stated intention of ever closer union since the days of the EU's founding fathers. So bit by bit the EU is inching towards that goal. The latest example is the calls for a European army.