Transcript What are the differences between the countries on the following map?

What are the differences
between the countries on
the following map?
Compare the distances North to South and East to West:
are they similar ?
Imagine
 Imagine traveling from Chicago
to New York City and having the
language, currency, prices of
goods, and basic laws change
every time you went through a
different state. What problems
might result?
Exchange rates
 Any time you exchange foreign money there is a commission charge
assigned by banks or currency exchanges.
 Example: $100 US dollars to Canadian. Exchange rate is 1.07
Canadian for every US dollar, or .93 US dollars for every Canadian.
Commission charge is $4.00 Canadian. How many Canadian dollars
would you get, subtracting the commission charge?
 1.07 * 100 = 107 – 4 = $103
 How much in US $ was the commission charge?
 .93 * 4 = $3.72 US
 Do others – you can get exchange rates on Internet
American Dollar
Argentine Peso
Australian Dollar
Brazilian Real
British Pound
Canadian Dollar
Chilean Peso
Chinese Yuan
Colombian Peso
Croatian Kuna
Danish Krone
Euro
Hong Kong Dollar
Hungarian Forint
Iceland Krona
Indian Rupee
Israeli New Shekel
Japanese Yen
Libyan Dinar
Malaysian Ringgit
Mexican Peso
New Zealand Dollar
Norwegian Kroner
1 USD
4.13769
0.999799
1.6698
0.645322
0.9947
495.122
6.58742
1887.48
5.60394
5.65813
0.759255
7.77067
209.411
116.503
45.3786
3.5487
83.2385
1.9324
3.06817
12.1974
1.3121
5.90326
in USD
0.241681
1.0002
0.598874
1.54961
1.00533
0.0020197
0.151805
0.000529807
0.178446
0.176737
1.31708
0.128689
0.0047753
0.00858347
0.0220368
0.281793
0.0120137
0.517491
0.325927
0.0819847
0.762137
0.169398
The European union
 So…. After centuries of competition
and frequent wars, nations of
Europe came together in a spirit of
unity and cooperation and formed
the European Union (EU).
1951: European Coal and Steel Community
 After WWII some countries in
Europe wanted to move away
from nationalism and come
together instead
 Robert Shuman proposed
 France, West Germany,
Belgium, Luxembourg, the
Netherlands, and Italy agreed
to pool coal and steel
resources and abolish tariffs
on all materials.
 Regulating coal and steel
industry spurred economic
growth for those countries
1957: European Community or the
Common Market
 France, West Germany,
Belgium, Luxembourg,
the Netherlands, and
Italy
 Established free trade and
stimulated economic growth
among member nations
 Allowed labor and capital to
move freely across borders
 Britain, Demark, and Ireland
joined in 1973
European Union
 1980’s and 1990’s: the group expanded
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and took on the name EU.
After the collapse of Communism, Eastern
European countries began to join
1999: A new currency was introduced:
Euro
2002: Twelve European Union Member
States used the euro cash.
2007: Euro introduced in Slovenia - the
first new EU member to introduce the
euro.
2008: Euro introduced in two other states
- Cyprus and Malta.
European Union
EU: 2007
 4 giants: Germany, Italy, France,
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United Kingdom
5 neighbors of Germany: Belgium,
Netherlands, Luxembourg,
Denmark, Austria
6 outer countries: Ireland,
Sweden, Finland, Greece, Spain,
Portugal
10 Added Countries: Cyprus,
Czech Republic, Estonia, Hungary,
Latvia, Lithuania, Malta, Poland,
Slovakia, Slovenia
2 Newest Countries: Romania and
Bulgaria
Total?
EU Headquarters: Brussels, Belgium
Branch
Members
How chosen
Term
Powers
Commission
(Executive)
20 commissioners
(2 from each of 5 larger
member nations; 1 from
each of 10 smaller
member nations)
By unanimous
agreement of
European
Parliament
5 years
Carries out treaties that
created the EU.
Has sole power to propose
and carry out legislation.
Council of
Ministers
(Legislature)
Each member nation has
one minister (votes
weighted roughly in
proportion to each nation’s
size)
By governments Determined by
of individual
governments of
member nations individual
member nations
Accepts or rejects
legislation proposed by
Commission.
European
Parliament
(Advisory)
626 members
(percentage per member
nation based roughly on its
population
By voters in
individual
member nations
5 years
Court of
Justice
(Judicial)
15 judges and
9 advocates general
By unanimous
agreement of
member nations
6 years
Debates proposed
legislation; advises both
Commission and Council.
Can expel entire
Commission with a 2/3rds
vote. Can reject a draft
budget.
Decides whether actions of
other branches and private
groups with EU rules.
Decisions are final and
binding.
 Looking at the problems
we mentioned earlier in
Europe, what were
benefits of the EU?
Benefits
 Save on exchange costs (billions annually)
 Worth of products (price of goods between countries without the
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exchange rate)
Creates new jobs
Creates more stability – more countries involved, so less fluctuation
Reduces economic differences among richer and poorer members
Easier to cross borders – no showing passports
Strengthens trade (no tariffs, export taxes, checking products at borders)
Common commercial policy
Speak with one voice
Same currency – EURO
Requirements:
 Stability of institutions to guarantee democracy, the
rule of law, human rights and respect for and
protection of minorities.
 The existence of a functioning market economy as
well as the capacity to cope with competitive
pressure and market forces within the Union.
 The ability to take on the obligations of
membership including adherence to the aims of
political, economic, and monetary union.
1999: A new currency was introduced: Euro
 4 originally opted out of Euro – (United Kingdom,
Sweden, Denmark, Greece) Why?
 The rest began replacing money in 2002:
1. Sacrificed the element of sovereignty and gave power to
Central Bank
2. Surrendered the right to devaluate (compete against
other countries when in a recession) out of trouble
3. Surrendered the right to run budget deficits to counter
mass unemployment
4. Only way out of monetary unit is to QUIT
5. To qualify, a country must have stable economy and
little currency fluctuation.
Why did a few EU countries resist adopting the
EURO?
1. Hurt their economy – increase unemployment
through layoffs
2. Cared about their currency – sense of pride
3. Expensive to change all currency to EURO
European Union: definition
 The European Union: an
organization that promotes
cooperation among its members in
the areas of: economics and trade,
social issues, foreign policy, security
and defense, judicial matters,
monetary policy, and establishes a
single market in which economics of
all EU member states are unified
Compare and contrast US and EU
 EU produces and trades more goods than the
US
 Trade barriers across national boundaries are
disappearing – like US interstate barriers
 Common currency plan – EURO
 Today, the European union is dealing with the
collapse of a handful of countries, and now finds
itself trying to stabilize their system.