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Mapping Wild Cards

Inspired by: workshops/meetings » Soft “EuroLanding” or "Happy End" in EuroLand

version: 7 / updated: 2011-01-11
id: #1414 / version id: #1295
mode: VIEW

Originally submitted by: Rafael Popper
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Last changed by: Rafael Popper
WI-WE status:
submitted unpublished archived

Source of inspiration

Workshops/Meetings

iKnow workshop country name

United Kingdom

Workshop date

February 2010

The source of the Wild Card is

iKNOW Workshop in Manchester

Headline

(max. 9 words)

Soft “EuroLanding” or "Happy End" in EuroLand

Description

(approx. 150 words)
Please describe the Wild Card (approx. 150 words)
The "Happy Ending" twist to Euro concerns involves the survival of the European political project and the emergence of a new “Euro Deal”, which dramatically transforms the economic and political landscape of Europe. On the one hand, debt-crisis countries are “allowed” to leave the Euro but at a high political cost (massive reduction in the number of administrative officials in European Union institutions) and a moderate yet acceptable economic and fiscal cost (e.g. a new “Euro Deal” tax or new agreements in total contributions to the EU and total receipts from the EU). On the other hand, richer countries rapidly benefit from the new Euro Deal’s reception by global financial markets and investors. Thus resulting in a steady recovery of economic and socio-political stability.

Keywords

Euro, Europe, economy, financial, currency, deal, fiscal policy

Mini-description

(max. 250 characters)

The growth of debts, austerity packages and spending cuts in Europe lead to critical economic instability and the abrupt transformation of the Euro Zone. A few countries leave the Euro at huge political price while others enjoy the new "Euro Deal".

Likelihood

Closest timeframe for at least 50% likelihood
Please use one of the following options:
now-2025

Features of life if the wild card manifests

Feature 1: business models and industrial environment
Businesses in several countries have to adjust to world of multiple currencies and floating exchange rates, in addition to national austerity.
Feature 2: education and research environment
Possible governance of collective research and infrastructure regime by core EuroLand countries, with priorities reflecting their national concerns.
Feature 3: consumers, markets and lifestyles
High divergence between core and more peripheral European countries. May result in another wave of large-scale migration in search of jobs.
Feature 4: technology and infrastructure
Uneven development of infrastructure based on market demand, though at least some crisis-stricken countries may gamble on investment in infrastructure as a means to attract foreign high-tech firms to locate (or remain located) in their area.
Feature 5: politics and global affairs
High divergence between core and more peripheral European countries. May result in political tensions, and new approaches to achieving representation in intergovernmental organisations. Impacts on internal market are unpredictable: perhaps some development of a two-tier framework.
Feature 6: health and quality of life
Health inequalities may be source of political concern.
Feature 7: security and defence
Defence cooperation may be traded off against economic inclusion.

Type of event

Unplanned consequence of events/trends/situations (e.g. financial crisis, accidental breakthrough)

Type of emergence

please select (if any) describe related trend or situation
An extreme extension of a trend/development/situation
(e.g. Increased global warming leads to a total ban on fossil fuels)

Type of systems affected

Human-built Systems - E.g. organisations, processes, technologies, etc.

Classification

Undesirable

Importance

please specify:
please select
Level 3: important for the European Union
Level 4: important for the whole world

Early indicators

(including weak signals)

There are several signals warning us about the probability of occurrence of such a wild card. Most recently the global financial crisis brought financial trouble to several European states, most notably Greece and Iceland, although different brought in its wake governmental crises and civil unrest. The collapse of the Greek economy has worried stakeholders and governments throughout the Eurozone as it has the possibility to drag other economies down with it due to investment and financial ties with Greece in the form of exports and imports. Other European states are currently struggling to bring their deficits under control and face governmental crises as a result, such as Spain and Portugal. It is feared that these troubles may start to spread across Europe. Investors are also starting to refrain from any investment in European financial markets, which further exacerbates the crises. Governments in financially trouble countries also have to face fierce resistance to their plans of cutbacks in public spending. This has in some instances resulted in protests and civil unrest causing injuries and loss of life as well as damage to infrastructure. These financial crises touch the lives of ordinary citizens and many face bankruptcy and extreme financial difficulties. Individual bankruptcy and unemployment is on the rise and families face loosing their homes and livelihood. As well as this putting the strain on families it is also a heavy burden to bear for already straining public services systems. These are all weak signals for rising public disillusion with politics and the financial systems, which potentially puts at risk the social treaty people have with their governments. Governments and banks are no longer trusted and widespread lack of trust could potentially lead to further civil unrest as the aforementioned have lost their legitimacy in the eyes of the people.

Latent phase

Obstacles for early indentification

information/communicational filters (media/editorial interests, language, reasoning)
institutional filters (rules, laws, regulations)
economic filters (business/market interests)
political filters (party or ideological interests)

Manifestation phase

Type of manifestation

In a probably pervasive way (contagious or transmittable)

Aftermath phase

Important implications
Transformation of a system (e.g. new applications, change in stakeholders relations/influence)

Comments

Transformation of the European financial and political system.

Key drivers or triggers

Provide up to 2 possible drivers or triggers of HIGH importance. Click on HELP to see examples:
please describe
Driver / Trigger 1 		please describe
Driver / Trigger 2
Social Growing anger in the European electorate in more stable European countries about the use of their taxes to bail out other countries' economies.
Economic Growing soverign-debt of some European countries.
Political Reluctance of larger European economies to rescue countries with severe economic problems.

Potential impacts (risks & opportunities)

Timeframe options
Risks Opportunities
immediate
(within 1 year after the Wild Card manifests) 		Resurgence of nationalism in individual European countries
short term
(1 to 5 years after the Wild Card manifests) 		Deterioration of European position in the world.

Potential stakeholders' actions

before
it occurs 		after
it occurs
Policy actors (at the international, European and national levels) Implement stability policies; regulate financial markets; EU policy formed on how best to assist countries in dire financial condition. Regulate and monitor the situation to avoid it spiralling out of control; Keep tight reins on policy response, avoid panic and make sure that response is evidence based.
Business actors (incl. SMEs) Invest in European markets, goods and services; Support national and European policymakers in the implementation of economic measures. Avoid price speculation or drastic decisions; Try to continue “business as usual” for a few months until new economic situation becomes much clearer.
Academic/Research sector To promote research on the Euro zone and its strengths and limitations; Research should aim to pinpoint areas of weaknesses and suggest solutions; Research in economics and economic models will be necessary to better respond to a sudden disintegration. Continued research focus on the issues named above; Research community would need to continue presenting research findings that would promote understanding of markets, currency, economics, businesses and also social sciences should focus on keeping track of quality of life of EU residents and report any drastic changes so they may be tackled without delay.

Relevance for Grand Challenges

where? please justify:
particularly relevant Europe world
Social exclusion & poverty
Economic prosperity/dynamics

Relevance for thematic research areas

please justify:
particularly relevant
Social Sciences and Humanities
International S&T Cooperation

Pan-European strategies potentially helping to deal with the wild card

please justify:
particularly relevant
Improving researchers mobility and career development by, for example, realising a single labour market for researchers.
Developing and funding world-class research infrastructures
Strengthening research institutions and universities
Facilitating and promoting knowledge sharing and transfer
Increasing the efficiency and impact of public research through Joint Programming (i.e. combining national and pan-European research efforts) or the optimisation of research programmes and priorities, for example.
Fostering and facilitating coherent international cooperation in science and technology

 Features of a research-friendly ecology contributing to deal with the wild card

For further information about 'research-friendly strategies' click here

please justify:
particularly relevant
Overcoming sub-criticality and systemic failures
To be subcritical means that the effort in a particular field or subfield lacks resources, equipment or a sufficient number of researchers to achieve a desired goal
Strengthening the actors in the research-friendly ecology
(i.e. Research funding organisations, universities, businesses, Research and Technology Organisations, Researchers and Citizens)
Addressing cohesion through a localised articulation between supply and demand
(e.g. making research institutions more engaged with their own context and local users; reinforcing knowledge flows into and out of regions; etc.
Creating a closer link between researchers & policy-makers
(e.g. supporting both thematic and cross-cutting policies, highlighting the strategic purpose of the European Research Area, etc.

Relevance for future R&D and STI policies

Note: RTD = research and technology development; STI = science, technology and innovation
Need to promote research on future changes in Europe’s monetary landscape. Recent shifts in the monetary landscape in the Europe indicate that stability is a key issue that needs to be carefully monitored. Recent events in Greece and Iceland, and worries over the state of affairs in Spain and Portugal, demonstrate how quickly financial problems can escalate and bring down a nation state’s entire economy. This has brought on civil unrest and governmental crises. Research in the field of European monetary policy is needed in order to provide an informed policy response in the face of financial crises. New strategies for extending research and innovation infrastructure over European space may be required.