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European Central Bank headquarters in Frankfurt, Germany.Ralph Orlowski/Reuters

On my family's summer holiday, we drove from Rome to Lublin, in eastern Poland, passing through three other European Union countries on our way. It was hard to tell exactly where one country started and another ended. Italy, Austria, Slovakia, the Czech Republic and Poland are all part of the EU's passport-free Schengen area, so there were no border stops, just changing speed limits and new languages on the road signs.

Try doing that in other regions of the world. You can't, not even in the NAFTA countries – Canada, the United States and Mexico. But how much longer will Schengen exist, or the EU, for that matter?

Border controls in the EU countries are making a comeback because of escalating terrorist attacks and the refugee crisis. The bigger threat to the borderless area is Brexit – Britain's June 23 vote to leave the EU. A widely held view is that Britain's exit signals that globalization and the halting progress toward open borders is dying or dead, and that the nation-state will emerge as the geopolitical building block of the 21st century. Already, increasingly popular opposition parties in some EU countries – France, Italy and the Netherlands among them – are calling for Brexit-style referendums.

Not so fast. Globalization is not dead, nor is the EU. Brexit is a major blow, yes. Only one country has voted to leave the union since its predecessor, the Treaty of Rome, was born in 1957: Greenland, in 1985. But Brexit will not be fatal. Remember that Britain was always a half-assed EU member. It never adopted the euro, the currency used in 19 of the EU's 28 countries. It had opted out of Schengen and had negotiated opt-outs in other crucial areas, including the EU's treaty-stated goal of forging an "ever closer union." The capitals of integration were always Brussels, Berlin, Paris and Rome, never London.

The EU certainly needs to be tweaked to make it more flexible, and further integration will surely be put on hold. But the EU won't die, because unions of countries make sense and the EU has had some great successes. The borderless market has promoted the (largely) free movement of capital, goods, services and labour, a godsend to permit-wary businesses and consumers who scour the continent for the best deals.

EU membership gives member countries clout that would be unimaginable on their own. Take Danish politician Margrethe Vestager, the EU competition czar. She has emerged as the world's most effective trust buster. In July, she slapped Europe's largest truck makers with a record €2.9-billion fine for illegal price fixing. In little Denmark on its own, she would be powerless. EU membership means that countries can centralize functions and set standards, from common trademark protection and bank capital requirements to auto emissions and drinking water quality. They can present a common front on fighting climate change and setting fishing limits. Membership allows the EU to negotiate trade deals with other countries from a position of enormous power.

Creating unions is never a smooth process, of course. All nation-states are fakes to some degree, in that their borders are often arbitrarily drawn. But their mythology is hard to destroy. It appears that Germans will always be Germans first, Europeans second, just as Britons used Brexit to take back sovereignty from Brussels. The EU is particularly messy because of the equal voting power of its members on some issues. The big countries resent the little countries' blackmail power, while the little countries resent the biggies' bullying power.

The EU, post-Brexit, is suffering an existential crisis. Its detractors – from Britain's new Foreign Secretary, the Brexit cheerleader and former London mayor Boris Johnson, to Marine Le Pen, leader of France's xenophobic Front National – insist the EU's central command is power mad, excessively bureaucratic, incapable of controlling its external borders and rigged toward big business. They are oblivious to the EU's accomplishments. It has built the world's biggest open and democratic trade bloc, a remarkable achievement among countries that were bent on destroying one another two generations ago.

The flaw is not so much the EU construction as the euro, which shouldn't have been introduced in so many wildly divergent economies. The euro deprived weak countries, like Greece, Portugal, Spain and Italy, of a release valve. They lacked a homegrown currency that could be devalued, so they had to introduce internal austerity measures. The economic results were disastrous. The youth jobless rate in Greece is about 50 per cent, and almost 40 per cent in Italy.

Dire macroeconomic deterioration is always fodder for social unrest and revolution. If the EU needs to be refined, the euro needs a complete overhaul. The common currency is the biggest threat to the EU, not the successful open market and its institutions.

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