Why the Euro Can't Afford to Lose Italy
No relationship in Europe is more complex or dangerous than the relationship between the EU and the Eurozone.
The EU contains 27 countries. Only 17 of them use the Euro.
The economic impact of the Euro on non-Euro countries is obvious. Now consider the political effect.
Current voting rules in the Council of the European Union (Council of Ministers) requires representatives of 62% of the member states’ population to enact legislation, and this will go up to 65% in 2014. Today’s eurozone represents 66% of the Union’s population. Without Greece, that number is about 64%. Without Italy, that number drops to about 54%.
The Treaties of Amsterdam and Nice greatly expanded the policy areas that could be decided by qualified majority to more traditional home matters, such as industrial policy, social policy, commercial policy, immigration and citizenship policy, external policy as it relates to the common currency, and certain aspects of the Common Foreign and Security Policy.
There are so many reasons for the eurozone to strenuously try to preserve Italy’s status as a eurozone country: the relatively huge scale of its economy and difficulties, its commitment to the euro and the Union over time, its new Prime Minister, himself a former and highly respected Union official, and its role in the existential crisis the euro itself currently faces. But its indispensability as a member in a future qualified majority creating bloc cannot be ignored.
It would be a normal, and under the rules legal, for certain changes inside the deeply integrated eurozone to be imposed across the entire Union. Without Italy, barring the addition of several more countries to equalize the loss in represented population, those changes will likely stay just within the eurozone, further exacerbating the differences between the two blocs--the eurozone and everyone else.