The European Union (EU) is currently and simultaneously facing three huge challenges, which are making the present period the most serious crisis the EU has ever known.

First, there is an immediate and urgent problem, which already affects the stability of the EU and might even affect its survival if it is not solved rapidly: the acute crisis of the euro area. The imbalances in the EU's economic and monetary union (EMU), as it is conceived in the EU treaties, are serious. They will be difficult to correct as long as those Member States who have the euro as their currency remain the masters of their own budgetary and economic policies, as is allowed by the treaties. The process of giving huge loans to countries in need (Greece, Ireland and Portugal) might soon reach both its economic and political limits. Many economists think that no solution will be found without ‘significantly increasing the degree of political union’ according to Paul de Grauwe, or what a Nobel prize-winner for economics (2001), Paul Krugman, calls ‘a revised Europeanism’ and another Nobel prize-winner for economics (2008), Michael Spence, calls an inevitable ‘greater centralization and political unification’. Such a great leap forward would not only raise economic problems, but also political, institutional and legal ones.