The closing of Europe

Europe's Other "Union" Is Ending

Zero Hedge,

28 April, 2012

Almost a year ago, we observed the first crack in that other fundamental core of the European "union" experiment - the Schengen visa-free and customs-union zone. We wrote: "While Europe may have sold its soul to the [monetary union] devil over the past decade it still retained its beating heart - the concept that served at the core of the European Union: the so-called customs union, or a mobile, borderless workforce. Alas, the heart has just entered ventricular fibrillation, as for the first time, a country, Denmark, has taken what appears to be the first step toward defecting from Europe's 60 year old experiment of intimate, and sometimes, forceful unification. As EUBusiness reports: "Denmark will reintroduce controls at its intra-EU borders with Germany and Sweden, Finance Minister Claus Hjort Frederiksen said Wednesday following an agreement between the government and the far-right. "We have reached agreement on reintroducing customs inspections at Denmark's borders as soon as possible," Hjort Frederiksen told reporters."

It was also then that we predicted the inevitable rise of the right (as demonstrated most vividly a week ago in the French presidential election) in Europe and its implications on the cohesiveness of the transnational European state:

"And while Denmark is the first to officially defect, even under a palatable explanation, it surely won't be the last: "The idea of controls at borders within the EU, also defended by Italy and France, was pressed by the far-right Danish People's Party and its head Pia Kjaersgaard, who argued controls would counter illegal immigration and organised crime." One thing we have seen in Europe is that courtesy of the relentless ebb of austerity, the far-right is progressively gaining a foothold in every country. And one can be certain that the populist whiplash against all things European, will not be contained to merely the monetary arena, but will rapidly devolve to restoring borders, following which the EU will exist only in history books."

This was in May 2011, and looking back at the Denmark case, we would call it the beginning of the end. A week ago, Spiegel had a very poignant follow up on this story, which unfortunately will have a sad ending:

Germany and France are serious this time. During next week's meeting of European Union interior ministers, the two countries plan to start a discussion about reintroducing national border controls within the Schengen zone. According to the German daily Süddeutsche Zeitung, German Interior Minister Hans-Peter Friedrich and his French counterpart, Claude Guéant, have formulated a letter to their colleagues in which they call for governments to once again be allowed to control their borders as "an ultima ratio" -- that is, measure of last resort -- "and for a limited period of time." They reportedly go on to recommend 30-days for the period.

Of course, using catchphrases like "ultima ratio" and "limited period of time" is supposed to make such policies sound reasonable and proportionate. After all, the reasoning goes, it's just a few occasional border controls for up to 30 days. What's the big deal, right?

But the proposal is far from harmless and would throw Europe back decades. Since 1995, the citizens of Schengen-zone countries have gotten used to freely traveling within Continental Europe. Next to the euro common currency, free movement is probably the strongest symbol of European unity. Indeed, for many people, it's what makes this abstract idea tangible in the first place.

And the Spiegel punchline:

To throw this achievement into doubt now is a vote of no confidence in Europe.

Yet while the Spiegel story discussed some indefinite event in the future as the first catalyst of the "temporary" unwind of Schengen, we now know just what it is. From the Associated Press:

Spain temporarily restored border checks in its northeast and at two major airports early Saturday in a bid to discourage protesters entering the country ahead of a European Central Bank meeting in Barcelona.

The Catalan regional capital is to host an ECB governing council assembly on May 3 as the financial crisis in Spain deepens, with 24.4 percent of the work force unemployed and the economy lurching into its second recession in three years.

Spanish authorities suspended the Schengen Treaty, which allows unrestricted travel inside member nations, and imposed controls at six border crossings with France and at Barcelona and Gerona international airports.

Security forces have been strengthened with 2,000 extra police on duty until midnight on May 4, when the restrictions are due to end.

At the La Jonquera border crossing in the foothills of the Pyrenees Mountains, around 50 police reinforced normal border guards and randomly stopped vehicles to ask for identity and vehicle documents.

Once again, the official version:

The office of Prime Minister Mariano Rajoy said on its official website that the text of the Schengen agreement states that free movement of people in borderless Europe can be stopped temporarily "if a serious threat to public order or domestic security exists."

Ah yes, because there have never been high level summits in Spain before that needed border closing to protect the participants from "riotous elements."

Here is the real reason - Spanish unemployment:

What today's news of out Spain means is that just like French discontent with economic policies is starting to have direct consequences in the form of a rapid shift to the right, so Spain is now too beginning to shut its borders to all those other visa-free traveling Europeans who are "poaching" jobs from the locals. Whether or not they are, is irrelevant (and as we showed yesterday, even when threatening job influx is a moot point - recall that Mexicans are now emigrating from the US - US companies opt to hire foreigners over locals in a 3 to 1 ratio).

What is relevant is that very soon more and more political leaders who are helpless to do anything to prevent their economic collapse under the rigidity of a monetary regime that benefits one at the expense of all else, will proceed to close their borders to free European travel, then the European customs unions will fall, and then finally Europe will be nothing but a loose collection of countries that hate not only each other but the minorities that dwell within, all in one big agenda to scapegoating someone else for the failure of the world's most destructive economic experiment.

Sadly this won't be the first time that Europe has had a continent-wide effort at isolating and blaming someone "else" for all the world's problems.

In the meantime, we suggest readers save a copy of this "map" of what Europe was supposed to be. As a memento. Because the current iteration of peak-Europe is coming to a rapid end as more and more "votes of no confidence" in Europe reverberate from countries near and far.