GOOD-BYE UNION EUROPEAN GOOD-BYE… THEY ALREADY COME IT UNTIL IN GERMANY

The differences of the economies of the component countries of the EURO, are a ballast that it seems already impossible to balance and therefore of making of the euro an appropriate foreign currency for such a heterogeneous group of countries and I take advantage of the occasion another time, to ask because it is more expensive a euro that a dollar. The euro has led to not being able to make this way in front of the crisis that began in 2008, today the high unemployment rates in the Eurozone and the substantial unemployment differences with USA, they are indications that show that the production and the labor mobility in the Eurozone are not working as adjustment mechanism.

 

The labor mobility is one of the fundamental approaches for the correct operation of a good monetary area, but it is also it that there is mobility of employment resources, that is to say an industrialization also homogeneous that allows the mobility, because if it is not this way, that it serves that an unemployed move if in the country of to the side neither is industries or work says it like want.

  

The benefits of a monetary union can be important provided the economic asymmetries that take place are absorbed in an efficient way. In case the monetary area is too heterogeneous, the problems could emerge in form of asymmetric interferences inside their members, because the monetary politics is no longer available, when having given the monetary sovereignty to an organism supranational. 

The economist Robert Mundell that won the prize Nobel of Economy for their studies on the monetary politicians and district attorneys low different exchange rates, and their analysis on the good monetary areas, published in the influential article 'To Theory of Optimum Currency Area', it points out that when a monetary union presents asymmetric shocks, these should be absorbed by "several adjustment channels to guarantee the long term viability of the union." 

 

These channels are those that allow that a monetary union works: mobility of the production factors, flexibility of wages and prices, certain opening grade, diversification and fiscal transfers. To these factors, it is necessary to add him others that have incorporated recently as the mobility free of the capital, the synchronization of the business cycle, stability of prices and some fiscal and political same politics objectives.

  

In a report published by Deutsche Bank it is shown that, from the explosion of the crisis in 2008, the labor mobility has been increased inside the area euro, what is without a doubt a good news. However, "the increment of the competition caused by the increase of the migration coming from countries unaware to the area euro is putting in risk the internal mobility of the Eurozone... Not alone the influence of refugees calculated in a million during 2015, the arrival of immigrants of countries of the east of Europe is also hindering the workers that come from the periphery of the Eurozone that now have more problems to find a work in Germany." 

The workers of some countries of the Eurozone are competing to obtain the same employments that the refugees, particularly in the segments of smaller wages, as well as the workers of the east of Europe are benefitting of their biggest English knowledge and German to find works with higher wages, it sentences the end of the report. 

 

That is to say, the Eurozone doesn't complete all the necessary requirements so that the countries benefit of the creation of a unique monetary area. One of the main factors that impedes the appropriate operation of the area euro is the drop labor mobility that right now even more danger runs for the arrival of the refugees and of workers coming from the east of Europe. This scarce labor mobility is preventing that the strong economic asymmetries are muffled inside the area euro, like it is the unemployment. 

The viability of the euro was already questioned in the zenith of the crisis of debt of the Eurozone, although the rescues and the intervention of the BCE have helped to maintain united the monetary area. The effectiveness of the monetary politics of the BCE, however, suffers of the economic divergences among the members and of its slow corrections. The DB recognizes that the labor mobility is very inferior to that of USA, a country that is usually studied as example of success of a monetary union. This situation of low labor mobility doesn't help to reduce the differences in the unemployment rate among countries, and for the same reason it is impossible to balance the national deficits. 

As consequence of the economic divergence among the members of the Eurozone, the work markets have left distancing until reaching alarming levels, especially in Spain and Greece, while in Germany the unemployment rate is falling to minima of the last years". This demonstrates that it is not so much the displacement of workers but of productions and industries in definitive of work positions because what demonstrates this fact is that the workers of the area euro and of the rest of the UE, if they move… but toward Germany.  

The economies neither the occupation rates are not balanced this way, conclusion the euro is not adapted for the current economy of the UE, another reason more than rational to outline that the UE should change structure politics and economic and be an area of free Common Market again, but maintaining the economic politicians, of development, of employment and fiscal, in being able to of each one of the partner’s members of this proposed European Common Market.