Instigator / Pro
6
1646
rating
59
debates
66.1%
won
Topic

THBT ONB We Should Abolish Euro Currency

Status
Finished

All stages have been completed. The voting points distribution and the result are presented below.

Arguments points
3
3
Sources points
2
2
Spelling and grammar points
1
1
Conduct points
0
1

With 1 vote and 1 point ahead, the winner is ...

Sum1hugme
Parameters
More details
Publication date
Last update date
Category
Economics
Time for argument
One week
Voting system
Open voting
Voting period
One month
Point system
Four points
Rating mode
Rated
Characters per argument
12,000
Contender / Con
7
1669
rating
25
debates
78.0%
won
Description
~ 590 / 5,000

This house believes that, On net balance, The Euro should be Retired/Abolished

Burden of proof is shared

We: Society/Law/Government (whoever controls Euro currency)

Should: The beneficial action to take, under net balance restrictions

Con: We should keep the Euro

Euro: the single European currency, which replaced the national currencies of France, Germany, Spain, Italy, Greece, Portugal, Luxembourg, Austria, Finland, the Republic of Ireland, Belgium, and the Netherlands in 2002. Nineteen member states of the European Union now use the euro.

Abolish: to get rid of, to stop using

Round 1
Pro
The crux of my argument is weakened or detrimental economy and lack of cooperation among Euro-zone countries.

My framework should be valued because the Euro is inherently about a currency -- an economic aspect of the world. Con likely has many arguments about how the politicians will perpetuate the Euro, that it will endure on. However, on principle, we ought to think about the social contract (on a national level). One would only accept a government's actions if each rational person could live under the societal principles and the enactment of such laws. Furthermore, there must be no superior alternative available. For example, the Euro is part of the European Unity, which Pew Research Center describes as "economic integration, membership in the European Union, the EU as an institution, the European Central Bank and use of the euro as their currency" [0].

Con might notice that the majority of people in the questionnaire supported keeping the Euro; do not be misled, they were offered a horrible alternative: returning to the old currency of drachma, franc, or other ridiculous currency. It's hard to say if they would still choose the Euro they were offered an alternative like the Dollar, Bitcoin, or another more reasonable choice. Regardless, Con must still negate the failure of realization of the economic integration as a whole. The nation is bigger than its people and is about the entire states interacting with each other. Due to the collapse of countries' economies, it seems unlikely that they can support themselves, much less trade well with other countries. In addition, my arguments present that the Euro-zone countries are basically at war with each other in a trading manner, which contradicts the social contract on a national level.

My argument will start with a political analyst's arguments and improving his claims. [1] Yoav first argues that we should analyze the cause of the crises, rather than the effects. He states that the EEC was already capable of preventing conflict and that a looser structure would allow better coordination and cooperation. He further reasons that federal Europe is behind the Euro, and the same currency use makes the federal structures' problems far sharper and more enhanced. He proposes a counter plan where we transition back to EEC to re-issue separate national currencies and abolish the EU presidency. He finally concludes that the Parliament would be maintained, but would have less power than national parliaments. 

To enhance Yoav's arguments, let's look into details why the causes of the effects are problematic. One book on the Euro [2] talks of how the Euro countries on average perform significantly weaker due to "misperceived iron law of required fiscal budge balance", thus caused by misunderstood macroeconomic principles (Eurozone Crises Chapter). He realizes that the failure comes from misguided decisions from politicians with ideas to promote neoliberalism and market integration (Page 7). The uncertainty to adjust to patterns of shock makes the policy uneven. Furthermore, the lack of formal agreements means that the macroeconomics implementation falls apart in reality. Despite high expectations, the Euro countries were still caught in a social collapse, and the EU is falling apart, echoing Yoav's call to action of moving forward to the EEC. 

If this wasn't enough, expert Vaclav Klaus furthers on how the Euro Zone has failed. [3] After he talks about the introduction of the euro-zone project, he tells us that the economic growth of member states has been slow, with increasing gaps compared to US, China, and non-euro-zone members. He notices that the euro fails to reverse the unproductive trend of "leisure society", and that the long-term trade imbalances have grown. Despite the uniform currency, there hasn't been any homogenization, and an economist of the European Central Banks argues that it was a political decision, therefore meaning that the cost of maintaining exceeds any potential benefits.

To put the nail in the coffin, Martin Feldstein, a famous economist, realizes that the Euro is an experiment that failed. [4] It "[imposed] a single currency on a very heterogeneous group of countries", and notes the same catastrophes listed above -- debt crises, the fragile condition of banks, high levels of unemployment, and large trade deficits. He repeats that countries have failed to work with each other and that the Euro's main purpose was political, not economic. Economists had long warned of the adverse effects on the economies of Europe, especially meaning that the fixed exchange value would lead to fluctuations in output and employment, which leads to negative values.

He reasons that the ECB has to make monetary policies based on overall conditions, which results in high-interest rates with countries with rising unemployment and low rates otherwise. He tells us that the monetary union caused borrowing too much and banks over-loaning on overpriced housing. With the incredibly high debt-to-GDP ratios, the national debt would cause the entire country to collapse, and the author deduces that the economy would be in shambles despite many different policies to counter the Euro's current effects. He also agrees that the differences in the eurozone members lead to differences in trade balances that can't be financed. 

Finally, yet another scholarly article notices how the Eurozone decisions perpetuate anti-democratic processes. In the abstract alone, the author realizes "The eurozone’s policy solutions to the crisis did not allow for any democratic input, were implemented through opaque and often-undemocratic throughput processes, and resulted in deteriorating output". As you can see the natural competition generated by the Euro means that the countries cannot work together, countering one of the core goals set by The Euro.

To assist this, yet another economic expert argues that the EU has taken an authoritarian turn, especially with emergency politics in the euro crisis. [5] The building of the cycle of authoritarianism means that democratic legitimacy is at stake. Even though the Euro's principles are not completely identical with Democracy, the ideals of freedom, equality, and ability of choice are crucial in an economy. Think about how nonsensical it would be if a head organization got to force countries to make decisions or implement specific economic policies. The shift of forcing authority is anti-European due to the elitism in European politics. You see, it fosters populism and resistance against the system, which is the opposite of cooperation. With poor European decisions, the dissatisfied voters would develop anti-EU ideals and directly contribute to my Social Contract framework. As a result of the authoritarian experience, the parties "successfully mobilized exclusive nationalist identities and anti-immigrant sentiments against a Union in which detached élites took decisions defying national sovereignty and democracy". In the conclusion, the author notices the possibility of collapsing the political order altogether and therefore fulfills the negative effects of the Euro. 

Conclusion

As you can see, The Euro has caused the demolishment of state rights, cooperation, and wholly detrimentally destroyed the economy. While National Sentiment means that it's unlikely for the Euro to be abolished, luckily I do not have to prove that it is even possible. Notice how "should" is defined in the debate description. It is under the net balance restriction, not under practical or political restriction (unless it costs more to abolish than maintain it). Given the numerous evidence in my favor, it seems like, on net balance, the Euro should be retired or gotten rid of. We must not let it continue.

Con
  Thank you Undefeatable for this debate. This won't be a very long opening.

  The Euro should not be abolished. The euro is the singular currency of nineteen nations, and while the advantages of economic unity are numerous and obvious, I will be attacking the resolution with three prongs: 1)The Euro makes trade easier between the European nations; 2)The Euro is a stable currency; and, 3) The Euro promotes the Unity of the European Nations in the Economic sphere.

  To begin, the Euro makes trade, both federal and private, much easier by virtue of making the general currency more liquid. The benefits of trade include, but are not limited to: stronger economies, faster transactions, and improved relations between nations and businesses. The benefit of this is showcased by the steady increase in the GDP of the European Union:
"2019 $15,626.45B $34,918    
2018 $15,965.03B $35,734
2017 $14,758.43B $33,081
2016 $13,886.85B $31,172
2015 $13,545.08B $30,470
2014 $15,632.61B $35,242
2013 $15,293.40B $34,564
2012 $14,636.30B $33,159
2011 $15,744.16B $35,722
2010 $14,544.08B $32,940
2009 $14,710.26B $33,363
2008 $16,237.75B $36,914
2007 $14,711.33B $33,552
2006 $12,703.64B $29,070
2005 $11,905.80B $27,333
2004 $11,399.53B $26,264
2003 $9,912.16B $22,923
2002 $8,049.79B $18,682
2001 $7,387.73B $17,185
2000 $7,259.89B $16,910
1999 $7,923.32B $18,477"[5]

  Secondly, the Euro has been a very stable currency. Since it's introduction in 1999 [1], it has exchanged with the USD at the lowest of 0.89:1 and a highest of 1.58:1 (Euro: USD)[2]. Compare this to the hyperinflated exchange rate of the Venezuelan Bolivar, which exchanges currently at 304,373,706,491.83:1 (Bolivar:USD)[3]; and the minute fluctuations in Euro exchange rates become negligible. In fact, the Euro was ranked higher than the USD on a list of the world's most stable currencies[4]. Stable currency allows for consumers to purchase more, thus stimulating and driving the economy forward. The GDP of the European Union is double what it was in 2000, when the Euro was first introduced. 

  Finally, the currency promotes Unity between the European Nations in the Economic sphere. The syllogism goes thusly: 
1) Economic Unity is an aspect of regional stability.
2) The Euro promotes economic unity.
3) Therefore, the Euro promotes regional stability.

  The need for regional stability is obvious, given that the last time Europe was horribly destabilized, world war two broke out. I am of course not saying that economic disunity is a direct road to war, but I am saying that the positive effect of economic unity on regional stability cannot be reasonably denied. Economic unity promotes growth and prosperity, as evidenced by the consistent growth of the GDP of the European Union; and further evidenced by the increase of employment rates in the European Union by 5.6% since 2005 [6].

  In conclusion, the Euro should not be abolished. The Euro paves the way for the economic growth and prosperity of member nations by virtue of making trade easier, being stable, and promoting economic unity. Growth and prosperity are great reasons to keep the Euro. I will save my rebuttals for the next round. Over to Pro!
Round 2
Pro
Con's argument is exceptionally weak. He first states that the GDP is steadily increasing, but fails to address the fact that the Euro zone countries perform weaker than out-of-Eurozone countries. While the Euro doesn't seem to prevent the GDP's overall improvement, it is still not the best policy overall. Con fails to analyze and compare why it overcomes Klaus's idea that Europe is falling behind. This would be like saying the poor are fine with earning one dollar per hour, while others are easily gaining 15 dollars per hour. It's clear that Euro-zone is barely surviving and Con is unable to overcome this.

Con argues that Euro is very stable in exchange rate, but fails to say why this is important. He's completely failed to talk about the devastating effects on the local economy, and just argues that it helped the GDP double which looks impressive on surface, but is completely misleading. For example, take a random developed country like China, which has 1 yuan per 0.16 US dollar, or 1 yuan per 0.13 euro, which approximates to 7 Yuan per currency. Surely China would be under heavy effects of inflation. Yet China's GDP has grown from 1.2 trillion from 2000 to 14.28 trillion in 2020, a 14 times growth. Even the US's GDP growth and Eurozone's growth is paltry and poor in comparison. How is Con going to explain this difference? His logic falls apart. It requires more than mere "stability in exchange" to successfully bypass the inflation principle. I heavily doubt GDP growth has been caused by the currency alone. In one excerpt, CRS report states, "Since opening up to foreign trade and investment and implementing free-market reforms in 1979, China has been among the world’s fastest-growing economies," [1] and the crucial cause of the economic improvement, stated be economists to be "... two main factors: large-scale capital investment (financed by large domestic savings and foreign investment) and rapid productivity growth. "

Therefore, Con is merely showing correlation, not causation. He must show how Euro directly leads to more investment and productivity growth, or other similar ideal like international trading improvement, to uphold the Euro's power. Still, other powerful countries like US and Japan are thriving without using the Euro, so he will have to explain what critically makes Euro so powerful over the Dollar, Bitcoin, or even returning to the countries' original currency.

Con states that his evidence alone shows economic stability, but widely ignores the powerful dangerous effects stated by my round one opening.

Recall that the violation of democracy is also countering the unity, and the authoritative stance taken by EU is directly countering the desired role of the Euro. 

Recall that there wasn't any homogenization in the Euro, and we failed to overcome the flaws from before -- the member states are still quite slow. Recall that the monetary conditions are horrible and the debts are still high in proportion. 

Con has still failed to provide anything to counter my argument, which provides tangible detriments wholly outweighing any vague unique benefits he might have had. 

Back to Sum1.
Con
  My opponent stated at the beginning that the crux of his argument is the weakened or detrimented economies of EU countries due to the acceptance of the Euro standard.  However, the numbers tell a different story than his proposed narrative. The economy of the European Union has been steadily increasing in strength, while unemployment is steadily decreasing. 

  My opponent further claims that non EU countries outperform EU countries. He supports this with the example of China's huge economic growth, but less stable currency. This is a poor comparison however. In part, because china has almost 3x the population of the entire EU [1][2]. Germany, the largest EU member, has only 82 million citizens to China's 1.4 billion. My opponent falsely accuses the euro for this disparity in economic growth rates. He's comparing relatively minor power's individual growth to one of the world's largest and strongest countries. Unfortunately for my opponent's narrative, the GDP of the European Union is together, higher than China's: 15trillion:14trillion (EU: China). Therefore my opponent's claim that EU countries aren't performing as well economically as China is true on an individual country by country comparative basis with China, which we have shown to be an inadequate analysis due to the huge disparity in population sizes. When we compare the European Union against China, we see that the EU has both a stabler currency in the euro, and a stronger economy. 

  My opponent claims that I failed to state how a stable currency is important. This is of course not true since I gave the following justification, "Stable currency allows for consumers to purchase more, thus stimulating and driving the economy forward." My opponent has ignored this fact, and I have shown causation. I never claimed, as my opponent's straw man suggests, that the Euro was the sole factor in the EU's economic growth. My only claim here is that the stability of the Euro contributes to the huge economic growth of the EU, and is therefore one reason why it should not be abolished. As a currency, the euro has been very successful.  In fact, the EU invested and profited twice as much as China in industrial research and development last year [3]. 

  My opponent has further claimed that EU decisions perpetuate antidemocratic processes. Unfortunately for his case, he hasn't demonstrated how the euro is responsible for this. If he cannot demonstrate how the euro, as a currency, Is responsible for authoritarian decisions made by the union, then this small facet of my opponent's argument falls apart and crumbles away.

  My opponent fails to establish the connection between high amounts of debt in EU countries, and the Euro. Rather than demonstrating the connection, he flatly asserts that the euro somehow caused this debt crisis. He must show a causal connection for his point to be valid in any sense. Otherwise, it is much more reasonable to blame the debt crisis on irresponsible spending of European politicians.

  In conclusion, my opponent's argument is a house of cards built on wild conjecture, and a lack of research. His impacts are missing causal connections, and his conclusions are false. Over to Pro.
Round 3
Pro
Forfeited
Con
Extend 
Round 4
Pro
Forfeited
Con
FIN