There are two ways to look at the Eurozone. One is as an economic project meant to better the situations of its member-states. That's how much of the world is seeing it with this week's Greek crisis, which will potentially end with Greece leaving the Eurozone. In this light, Europe's currency union does not look very successful at all.
Then there's the other way to look at the Eurozone: as part of a larger, decades-long project to transform Europe from a place of war and violent turmoil into one of peace and stability. If you take that long view, it starts to look pretty good. Before 1945, Europe had suffered centuries of devastating wars. Since 1945, it hasn't. There is certainly still turmoil — Greece's crisis, for example — but it's turmoil of a much less destructive sort than what Europe has endured in the past.
That European project isn't the only reason that Europe has become more peaceful, of course (neither is it the only reason that Greece's economy is in such trouble). And there is truth to both views of the Eurozone. The criticisms have a lot of merit. But you can't understand what's really going on with the Eurozone without looking at the bigger picture, and in that view it starts to look, while far from perfect, a good deal better.
The very sane idea behind the Eurozone: making war unthinkable
The drive to unify Europe has always been, in part, about economics. But it's also been about something else: preventing another deadly war in Europe.
The more you unite Europe's markets, the more expensive war becomes. European countries that depend on one another to stay rich and grow richer become less likely to risk screwing that up by launching a war. "When it's cheaper to buy things than to steal them, people don't steal them," Steven Pinker, a Harvard psychologist who studies the causes of war, told me in a recent Q&A.
But the European project is bigger than just markets. Unite the continent economically, the theory goes, and you'll unite it politically — create enough of a bond between Europeans that the specter of war will finally lift. War between the UK and France will come to seem as fundamentally unthinkable as war between Maine and New Hampshire.
Before 1945, war was much more common in Europe. It wasn't just World War II, by far the most devastating war in recorded history. Since 1648, which is roughly when the Europe of nation-states as we now know it came to be, almost all of the most deadly conflicts in the world came as a result of war between European powers — as this chart shows:
The post-1945 peace in Europe is, historically speaking, a real aberration. And there are good reasons to believe that the European project has played a role in making this happen.
For one thing, a number of statistical studies in the past several years have found that the more you integrate two states' economies, the less likely they war to go war.
There's also been a massive transformation in European political norms. Before 1945, European states viewed one another as security threats: when France and the UK disagreed about some issue, both sides thought of war as a live option for resolving the issue. Now, that's simply not the case. Europe is what scholars Barry Buzan and Ole Waever call a "security community," a place where countries "stop treating each other as security problems and start behaving as friends."
That is directly tied to European integration, which established a set of post-war institutions that make international disputes more like normal politics. The Europeans take their problems to each other and their shared institutions, such as the European Commission and Parliament. Because they spent the immediate post-war years forcing themselves to take to those institutions, Europeans proved that they can work, and thus made them far more appealing options than conflict. Europeans' fundamental beliefs about how European states should treat each other has transformed with the EU's institutions.
There are also larger forces not specific at Europe at play here. Political scientists have good evidence that democracies never or almost-never go to war with one another. Every European Union member is a democracy, so it's hard to credit European integration alone for peace in Europe. That said, the EU has also helped expand democracy: as Princeton's Andrew Moravcsik convincingly argues, the promise of joining the EU (which only lets in democracies), perhaps as well as other European institutions such as NATO, helped spread and consolidate democracy in eastern Europe in the late 1990s.
So, while European integration under institutions like the EU helped along the continent's transformation, it's impossible to isolate down the variables enough to say what Europe today would or would not look like without the EU.
It's best to think of the European project, then, as a kind of insurance. We aren't sure what's causing Europe's peace, but there are some very good reasons to believe integration is playing a major part — which means it's worth keeping around.
The Euro has been a part of this success
Of course, the fact European integration in general is a good idea doesn't mean that the Euro specifically is. You can tear down trade barriers and increase economic coordination without forcing everyone to adopt a shared currency, which has after all been at times disastrous.
That's true enough. But it misses two important things: what was going on in the world when the euro was first founded, and the ultimate endgame of the European project, a process of which the euro is a part.
The euro grew out of the 1991 Maastricht Treaty, which created the European Union. When Maastricht was signed, the Cold War was ending — and, for Europeans, that was frightening in its own right. The Soviet threat had forced Europe and the United States to work together; without it, no one knew whether the continent would return to its pre-1945 norm of internecine warfare. In a sign of those concerns at the time, John Mearsheimer, an international relations scholar at the University of Chicago, was arguing that the best case scenario was that a newly unified Germany would get nukes — to scare the other Europeans away from war.
The Euro was an extension of the effort to keep Europe safe — specifically by making sure that Germany wouldn't be reemerge to threaten anyone.
"For France, an agreement on monetary union was a means of integrating Germany even more firmly into European institutions and structures and of retaining some degree of leverage and control over its powerful neighbor," Michael Baun, a professor at Valdosta State University, writes.
This also speaks to another purpose of the euro: as another step in a series of steps with a foreseeable destination. The destination is Europe with a real political union — a United States of Europe. Viewed that way, not only does the euro's larger purpose start to make more sense, but so do its biggest weaknesses.
The basic problem with the Euro isn't that it's a shared currency. It's that it's a shared currency without a shared government. If Europe were form a real political union, and treated countries like states in a federal system, you could address many of the economic problems the euro has created.
This dream can live on without Greece. The rest of Europe doesn't really need Greece to make unification work. So as bad as this looks, it's not necessarily the end of the European project.
Now, whether the Europeans actually want to unite further is a separate question. But the disaster in Greece shouldn't blind us to the EU's accomplishments.