The Blame Game

From ScenarioThinking
Jump to navigation Jump to search

The Scenario

Saynotoeu.jpg

The year is 2030 and the European Union is only a shadow of its glorious past. The region is still feeling the impact of the 2009 financial crisis which led to a depression in Europe.

The billions of Euro pumped into the financial market by the richer nations, helped the economy to stabilize in the beginning and it showed signs of recovery. But, the recovery was long drawn and the rich nations were not able to sustain the financial flow and started withdrawing the money released, to divert it to other economic requirements. After all, each country had its own problems to cope with.

The EU was also unable to sustain subsidising the lesser developed member states. This caused wide spent resentments among member nations. With rising unemployment levels and falling standards of living, member nations turned their focus inward and adopted more socialistic practices.

People started re-looking at their identity. Till that time they believed in a unified EU, but as the EU was not able to keep the ship afloat, richer members considered the option of being the first to part ways so that they could be able to serve their people better.

That was the beginning of the disintegration.

Timeline

Period of 2010 - 2015

In 2010, after showing some early signs of recovery and a return of investor confidence the economy took a nose dive again. This was described by many economists as the dreaded ‘Double Dip’ which occurs in many recessions. The billions of Euros which had been pumped into the economy had shown no signs of being recovered as the consumer confidence stayed low and most companies continued to cut costs with no changes in top line growth. This resulted in a continued rise in unemployment across the union and especially in Spain and the UK. The rise in unemployment led to a further dip in consumer spending leading to more top line erosion for companies which led to more cost cuts and thus a vicious cycle was started which resulted in an even deeper depression. Soon enough, the strain started to show on the balance sheets of the all the major economies of the Union.

The pessimism and panic spread out throughout Europe and a feeling of uncertainty regarding the future explained several actions taken by individuals and governments to protect themselves. With the lack of confidence in the financial sector people started to withdraw their money from the banks. The bank run required immediate intervention from government, but promises that government would guarantee people's deposits did not stop individuals' willingness to hold their money during the turmoil.

There was a general feeling that all governments were not doing what they were supposed to do (protect their country and their people), and protests began to pop out in the most affected countries. The main criticisms were the large expenditures with the financial market with no visible return for those who were most affected.


Some countries collapsed and others were high in debt, not being even able to pay their obligations. Because of that, external investments diminished and small developing countries lost a big share of their money inflows.

With most of the funds diverted to save the financial system in the beginning and then to keep the social services later, investments in sustainable energy were dramatically reduced, especially those coming from Governments. Most of the companies developing technology in this industry were start-ups and were not able to survive for a long period without those funds. Another measure that influenced even more the investments in sustainable energy were the relaxation of some regulations. Penalties for CO2 emissions were reduced and the prices of CO2 credits went down. The idea was, save the companies first because the environment can wait.


Period of 2015 - 2020

The effects of the economic crisis were still deeply visible throughout the union. The downward trend had flattened out but millions of jobs had been lost. The huge numbers of unemployed started to feel a large amount of resentment at the large number of immigrants within their countries. They blamed them for the lack of jobs and there was a noticeable shift in the mindset of the people with more and more people sharing conservative ideas about closing down borders to immigration and tightening laws for off shoring and outsourcing. This started to cause wide spent resentments among the poorer member nations.


The idea of tightening border controls was first adopted by those smaller and most affected countries during the depression. The idea behind was to reduce the most visible consequence of the depression (unemployment) and to show to the population that those Governments were doing something to solve the problem.


Another maneuver used by those countries was the increase in import duties. It was against the main policies of the EU, but that was a form that those small countries found to protect their internal markets and, consequently, their companies that were still alive and generating jobs.


Global warming's consequences began to be more evident. The sea levels rose and some countries lost a considerable area in their coast lines. Due to the lack of investments in researches on sustainable energy, Europe was behind most of the other countries that continued to invest in this area. Critics of the current, at that time, Governments said that those politics did not have a long-term vision and because of that Europe would suffer the consequences.


Elections in the countries of the EU started to show a rise of left wing parties pushing a more socialist agenda. They blamed the capitalist way for the crisis and came to the conclusion that the socialism with its ideals of equality and fairness was a much better concept. The huge government equities in major companies were leveraged to enforce new labor laws. Protectionism was the flag raised by political parties to receive enough votes in order to remain in the power.


Period of 2020 - 2025

Socialism had taken a strong hold in Europe with almost all countries being governed by left wing governments. Socialist governments started to blame each other for the economic slowdown of the past decade.

The crisis had also effected countries in several degrees. Many governments wanted to regain control of their monetary policies to devaluate their currencies in order to improve exports and provide a much needed stimulus to their economies. The presence of a unified currency was thus seen as a roadblock to progress by many governments and some countries started to talk about giving up the Euro and going back to national currencies. <br\>

The growth of socialism also led most countries to focus primarily on their own national agenda, thus ignoring worldwide issues like climate change, green technology, poverty reduction, immigration and conflict resolutions.

Immigration became harder and most of the countries adopted very tight border controls, generating some tension points between regions. Free trade was also not free anymore, with many countries using import taxes as a protection of their internal markets and industries. It was not desirable to have a money outflow because those funds were required internally to keep the economy moving.

The lack of new investments in renewable source of energy led to a growing dependence on conventional sources of energy such as oil and gas which were becoming increasingly scarce. This led to a greater dependence by most EU countries on Russians resources. Some members developed good relationship with the Russians while others were against the high level of dependence. The difference of interests were becoming bigger among the members.

Global warming affected even more the economy of the region. Some countries that made huge revenues in the winter season started to lose money and jobs as the winter period became shorter and the snow receded out many famous ski resorts. Ski resorts and their respective hotels looked like abandoned cities during what used to be the peak period. Because of rising sea levels coastal areas started to get flooded and some internal displacements were happening. This also created internal tensions in some countries.

Period of 2025 - 2030

Everything that happened during the previous years moved Governments to a more inward approach. Each country had its own problems and had to take care of its own population. There was not excess of capital to help other nations and the burden of the social services provided by te countries was becoming higher and higher.

There was not enough population growth to sustain the benefits paid by the Governments through social services. As a consequence there was an increase in the taxes each individual was paying. People started re-looking at their identity. Till that time they believed in an unified EU, but as the EU was not able to keep the ship afloat, richer members considered the option of being the first to part ways so that they could be able to serve their people better.


That was the beginning of the disintegration.

Background Information

Governance


Economy


Identity


Immigration


Boundary


Financial System


Culture


Commerce / Trade


Resources / Energy


Political Alignment


Population Change


Graphical timeline

EUNewTimeLine.png

Summary

The Europe unification has come to and end after many attempts to unify it under a new Constitution to give more power to Brussels.