European Union

Most Americans are citizens of just one country—the United States. Can you imagine having the rights of citizenship in many different countries? You’d have a lot more choices about where you could live, work, or study.

Many people in Europe have choices like these. That’s because more than two dozen European countries belong to an organization called the European Union, or EU for short. Countries that belong to the EU cooperate with each other. Citizens of EU member countries can freely travel, live, or work in any other member country.

Europeans founded the EU in 1993. But the EU has its roots in an organization that formed more than 50 years ago.

WHAT DOES THE EUROPEAN UNION DO?

The EU is an organization that brings European countries together to cooperate on economic and political matters—much like the different states in the United States work together. To help member countries make decisions and settle disputes, the EU has its own governing bodies. These include a legislature and courts.

A major goal of the EU is to promote free trade between member countries. In the past, trade barriers prevented European countries from trading freely. These barriers included tariffs, a tax paid when goods are moved from one country to another. Removing tariffs made trading easier and less costly.

The EU also makes it easier for people to move from one country to another to find work or go to school. Today, all EU member countries grant their citizens European citizenship. That means a citizen of France or Germany has the right to live and work in every other country that belongs to the EU.

ONE CURRENCY, MANY COUNTRIES

In the United States, you can go to any state and use the same money—the U.S. dollar. That makes it easy for people to cross state borders to buy or sell goods. But in Europe, before the EU formed, every country had its own currency (form of money). If you were in France and wanted to shop in Germany, you had to exchange your French money for German money. This was costly and inconvenient.

The EU decided to change all that by creating a single currency, called the euro. A euro is divided into 100 cents, just like the dollar. Any member country of the EU can use the euro as its currency if it passes certain economic tests.

Today, you can use the euro to shop in countries such as France, Germany, Belgium, Spain, and Greece. These countries gave up their own separate currencies to use the euro. The EU hopes all member countries will eventually adopt the euro.

OTHER EU GOALS

In addition to economic cooperation, the EU works to promote political cooperation among its members. The EU believes member countries should decide together how to respond to international problems or threats. But many Europeans don’t want to give up the right to defend their countries as they see fit. Often, this makes political cooperation difficult.

WHY WAS THE EU SET UP?

The EU grew out of an organization set up in 1951. At that time, World War II—the most destructive war of the 20th century—had just ended. A few decades earlier, World War I was fought on European soil. European leaders wanted to build cooperation between former enemies. They wanted a better way to solve disagreements among countries. They wanted to make sure there were no more terrible wars in Europe.

European leaders believed that the best way to guarantee peace was for people to trade goods freely across national borders. They believed free trade would lead to greater wealth and a higher standard of living across Europe. European countries would then defend free trade in order to defend their own wealth.

At first, the organization they set up was aimed at eliminating trade barriers in the coal and steel industries of just a few countries. These industries are important to many other major industries, such as making weapons or cars. The success of the European Coal and Steel Community (ECSC) led to new agreements that removed more trade barriers.

In 1967, the organization became known as the European Community (EC). The EC, in turn, was formally renamed the European Union in 1993. Today, more than half of the countries in Europe belong to the EU, and the organization is still growing.