summary
  • In Europe, The Politics Thicken
  • Businesses on Tariffs: Wait and See
  • The Price of Trade Protection

The European Union (EU) is a political and economic union borne after World War II of a desire for harmony in a scarred and divided European continent. The original concept was founded on the hope that it would “make war unthinkable and materially impossible.” The original deal was signed in 1950, and called for six nations (Belgium, France, Italy, Luxembourg, the Netherlands and West Germany) to pool their coal and steel resources. Seven years later, those nations signed the Treaty of Rome, creating the European Economic Community. This laid the foundations of today's European Union.

The bloc has grown steadily from its six founding members to 28 nations today, but so have its political complications. This week’s European Parliament (EP) election results reflect more differences than common causes.

The EU's political landscape is undergoing a shift. Europe's longtime political center, comprising traditional center-left and center-right blocs, has lost its majority in the EP. Parties on both edges of the political spectrum have expanded their influence. The results suggest that the EP will be a fickle place in the years to come.

Weekly Economic Commentary Chart 1 - 05/31/19

Today’s political commotion is nothing compared to the upheaval of the late 1980s and early 1990s, the era of the end of communism in Europe and the reunification of Germany. However, the decisions taken by the new EP will have important implications for Europe’s economic future.

Representatives to the EP are directly elected by citizens every five years. The body has grown in size in the last two decades, as many ex-communist states in central and eastern Europe have joined the EU. The EP currently has 751 members, called MEPs. Germany has the most (96) delegates, followed by France with 74, and the U.K. and Italy with 73 each.