European Constitution Referendum / Europe and the US – What Next?
by Dean Myerson
February 3, 2005

The Euro and the Dollar
The successful
establishment of the Euro in 12 European countries over the past few
years has proven many skeptics wrong. Many debate the possibility that
a strong Euro could eventually replace the dollar as the global
currency, a result that would make it almost impossible for the United
States to sustain its massive fiscal and trade deficits, but there is
no guide from history for such an unprecedented shift. And while many
experts hypothesize, there is no way to know when the dollar's decline
in value would be too much and the shift would occur. The United States
plays a form of Russian roulette by tolerating or encouraging deficits
and a weak dollar, and so far has gotten away with it. But next time
you hear somebody complain that the United States has subsidized Europe
via its large military budget, point out that Europe has subsidized the
United States via the weak dollar ever since the United States left the
gold standard over 30 years ago. At that time, there was no Euro. –DM

Europe and the US – What Next?
Green Institute’s analysis of the relationship between the United States and Europe and the role of the European Union

Director Dean Myerson recently published an essay titled, “Should the
European Union Become a Balancing Power to the United States?” He finds
that while the EU may be the one global entity that has the scale to
challenge the United States, many peace activists, Greens, and other
progressives worry that if the EU takes on such a role, it could become
the very type of dominating global role that they oppose in United
States foreign policy. This is particularly a concern in the
military/security field, where some advocates of European integration
are pushing strongly for a larger EU military capability. While some
amount of military capability can be used in peace-keeping, this is not
the kind of military that creates an alternative military philosophy.

Myerson suggests that Europe’s alternative to America will come from
what is generally called the social field, which includes
environmental, judicial, human rights, and other related policies.
Currently, this field includes global warming policy, opposition to the
death penalty and genetically modified foods, and support for the
International Criminal Court.

Says Myerson, “Only as a result of
EU bargaining with Russia are the Kyoto Protocols coming into force for
signatories. The EU’s strong advocacy regarding the scope of the
International Criminal Court has challenged American efforts to be
exempted in many countries. And while Microsoft has beaten back most
antitrust challenges in the United States, it was unable to beat the
European Commission.”

The best example of the EU’s power may be
the draft chemical regulation policy known as REACH (Registration,
Evaluation, Authorization of Chemicals). This proposed EU policy would
enshrine the precautionary principle, which says that substances should
be proven substantially safe prior to large-scale commercial use.
Predictably, chemical companies, with the U.S. government in tow, are
in opposition. They know that if the EU adopts the precautionary
principle, it could spread further.