An entirely commendable and even necessary push by Ireland to safeguard its economic sovereignty from the machinations of German and French Eurocrats reveals the crippling structural weakness of the EU. The FT reports:
The Irish government has asked the European Union to amend its treaties in order to provide specific legal assurances that the country can continue to control its own corporate tax rate.The request, which comes against a backdrop of growing calls for greater fiscal union in the EU, reflects Ireland’s concern that it could be forced to raise its ultra-low 12.5 per cent corporate tax rate – a move the government says would undermine its competitiveness and ability to attract inward investment….For the protocol to be ratified, all EU member states would have to vote on the issue in their national parliaments.
The Irish, still suffering the after effects of their massive banking crisis, are understandably worried about protecting one of the few tools they have to promote economic recovery. Earlier this year Dublin barely foiled a cynical Franco-German ploy to hold interest rates hostage unless the Irish raised their corporate tax rate to match the Central powers. The wary Irish, who rankled the Eurocrats in Brussels in 2008 by initially rejecting the Lisbon Treaty that created an EU constitution, want to make sure they don’t get strong-armed in the future.Via Meadia is all for that. But the process exposes one of many weak spots in EU governance. The requirement that all 27 member states (soon to be 28 when Croatia joins) must agree to any significant change in the EU is a disaster waiting to happen. History moves faster than the EU these days.Europe is not ready for something like the Philadelphia Constitution the United States adopted in 1788; national differences are much too profound and public opinion is not ready for such a step. Perhaps it should look to Montgomery; the Constitution of the Confederate States of America (dropping that slavery guarantee, of course) might actually work better for Europe than the current US approach. The Confederate Constitution was much more protective of state sovereignty than the Philadelphia one, but it was significantly stronger than the Articles of Confederation.Now that Europe has gone all tea party on us, with budget cuts and welfare reform from Ireland to Greece, maybe the next step for the European Union is the Confederate States of Europe.