The term “Brexit” has been in the news lately. It refers to Britain's possible withdrawal from the 28-nation European Union. Proponents of Brexit believe it would give the U.K. more independence and flexibility in economic policies. In this BBC interview, President Obama recently urged U.K. voters to vote against Brexit. His stance is that the U.K. would lose financial influence and trade deals would take longer to negotiate if the U.K. left the EU.
After these recent developments, I thought it would be a good idea to refresh my understanding of the EU. I found the video below to be extremely helpful. It gives a great rundown of Europe’s history and how it came to its current situation. It starts by discussing Europe’s tumultuous past and how those conflicts stifled trade. The conflicts caused European nations to enact tariffs and taxes. The result was that trade between European countries was costly and slow. A desire to make trade easier was the impetus behind the Maastricht Treaty of 1992, which created the European Union. The treaty made trade easier but European countries still had separate currencies. In 1999, a number of countries in the EU adopted the euro as its single currency. The video describes the mechanics of how monetary and fiscal policy have created the current debt situation. It also describes how all of the EU countries are interconnected.
