Menu IconA vertical stack of three evenly spaced horizontal lines. The European Union was a noble dream, but as happens with most leaving the european union, reality eventually sets in.
It is simply not possible to maintain economic unity and a single monetary policy among a collection of states, each of which sets its own fiscal policies. Europe’s sovereign-debt crisis was the first sign that something was structurally wrong. Germany spent years loaning euros to poorer eurozone countries so they could buy German-made goods. Other exporting nations within the EU did the same. The resulting trade imbalance had to show itself somewhere.
It did — in the government debts of countries like Greece, Italy, Spain, Portugal, and Ireland. Now add the political tensions stemming from the migrant crisis and the risk of Brexit, and Europe’s collapse becomes increasingly real. Here I outline the five biggest internal risks the European Union faces right now. How it handles them will make or break the entire union — and possibly the global economy. Italy will probably be Europe’s main headache.