Lesson 6: European Union
Review:
- World War II
- 20th Century Europe
Presentation:
- European Union
- Established formally in 1993 under the Maastricht Treaty
- Political and Economic union with 28 current member states
- Internal market enabling free movement of people, goods, services and capital
- Monetary union with common currency: Euro (€)
- European Union (EU) Explained (6 min)
- Sovereign Debt Crisis
- Circa 2010-2014
- 2008 US Mortgage/Financial Crisis = Catalyst
- Explained in The Big Short (recommended), Too Big to Fail, and Inside Job
- Or…here’s a short version (warning: Rated R for language)
- Crisis in a nutshell
- Some EU countries (starting in Greece) used easy credit to borrow too much
- Foreign Banks/Investors panic, demand higher interest rates
- Higher interest rates made the debt problem worse
- EU bailout of Greece and imposed austerity
- Fear of contagion to Italy, Spain, Portugal, Ireland
- How Germany Became Europe’s Richest Country (2012, 9 min)
- Highlights a structural flaw in the EU
- Centralized monetary policy (ECB)
- Decentralized fiscal policy
- Begins the momentum toward Brexit
- Weakens EU
- Refugee Crisis
- Millions of Syrians flee
- Many migrate to Europe
- Europeans disagree over how the refugee crisis should be managed
- Anti-immigrant sentiment increases
- Accelerates the momentum toward Brexit
- Weakens EU
- EU vs US Economy
Assignment:
- Watch European Debt Crisis Documentary (Wall Street Journal, 23 min)
- Watch How Germany Became Europe’s Richest Country (PBS News Hour, 9 min)
Recommended (optional):
- Exodus – Syrian Refugee Crisis (Frontline)
- The Big Short
