Eruope's Financial Crisis

  Consider the current discord among European Union members.  Why is it so important for the countries to maintain harmony?  How does the level of economic integration achieved by these nations influence this situation?

  The European debt crisis has been taking place in the European Union since the end of 2009. Several countries such as Greece, Spain and Ireland faced the collapse of financial institutions, high governmrnt debet. The risk rapidly spreads into other european countires and there is a controversial debate that whether Germany and France should reach their hands to help Greece and other Eurozone member states. In my opinion, the crisis is pressuring the Euro towards a more federal EU with fiscal powers because either Germany or Greece can get through the crisis without cooperation and interdependency.

  Even there is a lot of criticism of the German goverment at the moment, they should not agree for a debt write-off from Greece because it may not equal to German taxpayers (Buttonwood 2015). But generally speaking, if European Union moves toward to break-up. As a result, Having instability and the public debt issue still not solved. Furthermore, the contagion effects and instability would influence other European countries (Anand 2012). To be more precise, the main explanation is in two aspects. Firstly, if Germany choose to exit the Eurozone, in comparsion of providing help to the Greece, they will pay more. This is because Eurozone accounts for 40% in Germany’s export, the abandoned countries would set up trade barries to Germany . Moreover, After the Second World War Germany pursues to unite Europe as a whole avoiding reenacting war tragedies (Xu 2012). Therefore Germany would not give up their efforts in maintaining harmony for each countries . In the aspect of Greece, if Greece choose to exit Eurozone and not to repay the debts. As a result, the government of Greece would loose their credibility thus banks would not provide captical to Greece any more. It would led greece’s economy becoming worse. In addition, if Greece gives up euro and uses their own currency, it may cause currency devaluation leading to instability in Greece (Xu 2012).