The crisis of the European monetary union has unfolded at roughly the same time as the Arab Spring, and their geneses illustrate a striking contrast in those societies’ views of government. Whereas people in the authoritarian countries of the Middle East and North Africa are insisting on governments more accountable to them, the people of Europe are agitating to reduce government sovereignty, replacing it with a commitment among governments. The juxtaposition demonstrates the extent to which nearly all European governments believe they no longer—or should no longer—have the power to act as sovereign governments.
David Cameron made a big bet that the other EU governments are mistaken in that view. Britain refused to agree that the EU should be allowed to supervise its choices on how much money to spend. Whipped by the turbulent financial markets and the public’s outrage at bailing out other Europeans, Europe’s creditor states demanded the right to establish limits on the amount of debt a country could accrue. The EU proposal, adopted without Britain, is that national budgets would be submitted for review by all other EU countries and, failing to gain their support, states would be fined for infractions of the rules.
Cameron thinks that Britain is likelier to prosper by setting its own rules than allowing a collective of countries—even those with similar interests—to set the rules. He points out that the structure of Britain’s economy gives it a greater reliance on financial services industries, something the governments of France and Germany would like taxed more heavily. He doubts that his fellow European governments will serve Britain’s interests better than Britain itself. He is surely right, although the argument depends fundamentally on whether states still have the capacity to chart their destinies.