As part of ECFR’s ‘Reinvention of Europe’ project, we are running a series of responses from leading thinkers and academics to Mark Leonard’s recent paper,‘Four scenarios for the reinvention of Europe’. The paper outlined four possible routes towards solving Europe’s current crisis, and argued that Europe’s main challenge was to solve the acute euro crisis without exacerbating the chronic crisis of declining European power. In the third in this series of responses, we hear from Brigid Laffan of University College Dublin:
This essay by Mark Leonard is to be welcomed because it places the political challenges facing the EU centre stage. The emphasis on politics is an important antidote to a narrow focus on economics in much of the commentary. A new European Union is being configured, the nature of which will only become clearer over time as choices are made.
Two important dimensions of that new EU are not brought out sufficiently in the Leonard essay. First, the new EU is being developed with the euro at its core. There appears to be a very strong commitment to saving the euro, to doing what is necessary to prevent an implosion of Europe’s financial system. Second, the Union will no longer move at the pace of the slowest ship. The decision of the UK to veto treaty change à la 27 and the decision of the 17 to proceed with an new international treaty was of profound political importance. It is as yet unclear which member states will join the 17 and which will opt for an outer circle with the UK. A significant majority of member states are likely to opt for the 17. Prime Minister Cameron has unleashed a dynamic that the UK cannot control.
There are many unresolved tensions that are brought out in the Leonard essay. Four, appear to me to be crucial to the future of the EU. First, will the euro’s small and medium sized member states be capable of re-establishing their voice in the decision making process? The Merkozy tandem amounts to a damaging de facto if not de jure directoire in the Union. It is in the interests of small states that the Commission regain a central presence in the Union. However, the Commission must ensure that its political antennae and technical competence are such that its intrusion into member state budgets is effectively and legitimately exercised. Second, can the euro states work effectively to address the current crisis as well as preventing its reoccurrence? To date far too much political attention has been focused on preventing its reoccurrence instead of dealing with what was an interlinked sovereign debt and banking crisis from the outset. The solvency of a number of euro states, not just Greece, remains problematic. Third, as the Union intrudes more and more into domestic budgetary and public finance choices, can party politics in Europe adapt to a very different governance regime? Fourth, as the EU develops on the basis of closer integration among the euro states, how will the relationship between the inner core and the outer rim evolve?
The likely outcome of the current dynamic lies somewhere between Leonard’s Asymmetric Integration and Federalism without the Federalists. The least likely outcome is Political Union, even if we could agree on a definition for it, through treaty change. The Union may well muddle through but a line from Yeats, The Second Coming, offers a stark alternative: ‘Things fall apart; the centre cannot hold’.
Also in this series:
Reinventing Europe: Harold James - ‘The more Europe suffers, the more its people will see that a reform agenda that is just an exercise in incrementalism is also nothing more than an exercise in futility’.
Reinventing Europe: Richard Rosecrance - ‘if Greece or Spain did not exist, they would have to be invented. Their participation in the euro keeps the value of the currency down from $1.80 to $1.20 or $1.30 or so, thereby ensuring the success of German exports to the rest of the world.’
Reinventing Europe: Charles S. Maier - ‘The British can imagine that their banks will suffice, the Germans their autos, but such comparative advantage can dissipate quickly. I’d as soon wager on Greek beaches.’
Reinventing Europe: Georg Sørensen - ‘a substantial part of the present euro crisis has less to do with European cooperation and more to do with member states that are fragile, ineffective, have serious corruption problems…’