European Union (EU)
The European Union was formally established by the Treaty of Maastricht in 1993, with origins dating back to the aftermath of the Second World War. The European Coal and Steel Community (ECSC), involving Germany, Belgium, France, Holland, Italy, and Luxembourg, began in 1952 as a way for countries to form a free-trade area surrounding a number of key resources. From this union sprung the European Economic Community in 1957, which facilitated a common market by eliminating tariffs and regulatory barriers to trade in the countries involved in the ECSC. Further agreements to deepen markets, along with the inclusion of far more member-states, eventually led to the establishment of a common currency zone (centered around the euro in 1995). As economic bonds between participating members increased, the dark side of harmonization began to show.
The EU’s regulatory apparatus, centered around the European Commission, steadily increased the amount of red tape across the continent to the detriment of millions of taxpayers, consumers, and businesses. As an operating principle, the Commission holds that regulatory approval should be strictly curtailed if “potentially dangerous effects deriving from a phenomenon, product, or process have been identified” and “scientific evaluation does not allow the risk to be determined with sufficient certainty.” This seemingly simple statement leaves plenty to the imagination, and gives authorities leeway to restrict products and technologies that may have a net beneficial impact but carry the potential for dangerous side effects. In response to EU limits on genetically modified organisms (GMOs), for instance, leading German and American agribusinesses halted research that could have expanded food supplies. Despite assurances from leading scientific organizations and regulatory bodies in the developed world, the standard of evidence simply wasn’t good enough for EU bureaucrats.
Recently, the EU has been considering a tax targeting technology firms with digital revenue of at least 50 million euros within the member-states (and total worldwide revenues of 750 million euros). This proposal would increase transportation (ie. ridesharing) prices for citizens across the continent, and make entertainment services scarcer and more expensive. Additionally, the emerging Digital Single Market will impose onerous content quotas and taxes on streaming services, reducing offerings to online viewers and bolstering illegal substitutes. These moves will have ramifications for US producers, as movie piracy will increase because many illegally downloaded movies are first uploaded in European republics.
Clearly, then, overreach by the European Union extends far beyond the IGO’s home continent. For a prosperous future, EU citizens must demand greater accountability and lighter rulemaking from the institution.