Can Europe Take Care of Itself?

Jean Monnet, the chief architect of European union after World War II, once described crises as the great integrators. Without a clear and present danger to outweigh self-interests, he believed leaders would not make tough choices needed.  The current problems facing the European Union seem likely to test the validity of Monnet’s claim as a project many saw as destiny flirts with destruction.  Adopting a single currency marked an important step towards an economic integration aimed at ratcheting member states into a tighter political union, but the story took a different turn.  The euro now serves as a mechanism to heighten economic strains upon member states.  Financial crisis in Greece risks spreading to other economies as lenders raise their terms for purchasing bonds or flee vulnerable banks.  Rather than drawing Europe together, however, this and other crises over the past few years highlight deep tensions that work against integration, at least of the kind Monnet envisioned. Walter Laqueur’s After the Fall: The End of the European Dream and the Decline of a Continent explores what caused these present discontents and the issues behind them.

Laqueur brings to the task particular authority since European integration and the bitter history used to justify it maps the story of his life.  Born to a Jewish family in Breslau—a German city transformed into Polish Wroclaw by population transfers after World War II—he fled Nazi persecution in 1938 after completing studies at the Johannes Gymnasium.  Laqueur took refuge in British controlled Palestine at 16 where after university study and a brief stint as an agricultural laborer in a kibbutz he worked as a journalist for almost a decade.  The combination of a broad classical education with training as reporter led to an academic career at the intersection of policy analysis and contemporary history when he moved to London in 1955.  Research drew Laqueur into the political, economic, and social questions that shaped postwar Europe.  Indeed, he came to the United States at an important turning point when foreign policy challenges set a premium on informed analysis of Europe and the Middle East which émigrés could provide while the expansion of higher education created a golden age for academics.  Laqueur has seen “Europe and Europeans in good time and bad” with a perspective shaped by an appreciation of history and culture policy analysts typically lack.  He builds upon an earlier book The Last Days of Europe published in 2007 to summarize insights from his career.

Critics then had resisted Laqueur’s discussion of Europe’s decline, with The Economist disparaging the book’s “unduly apocalyptic conclusions.” Not surprisingly, Laqueur takes bemused satisfaction in reporting a more recent editorial in The Economist entitled “Staring into the Abyss.”  The financial crash of 2008 had completely shifted the terms of debate by revealing structural economic problems.  Steps toward European integration had typically gone with the flow of national politics and served the aims of member governments.  But monetary union had the opposite effect after the crash by constraining governments.  Euro zone economies could not stimulate their economies by currency devaluations as Italy and Greece had done historically.  Interest rates set for Germany, the dominant economy at Europe’s core, had spurred a speculative property boom in Ireland and Spain whose collapse damaged banks and public finance.  The euro also served as a transmission mechanism spreading financial contagion among countries sharing the single currency.  Given these developments, Laqueur sees the immediate concerns as what can be done to ensure a soft landing and perhaps even a future recovery along with how the crisis will shape the choice between integration, a shift back to national sovereignty or continued muddling along.

Laqueur writes that the Europe he has known is in the process of disappearing. Having lost political initiative to the United States and Soviet Union after 1945, Europe now sees the balance of economic power shift to Asia.  Demographic change, particularly an aging population combined with low native birthrates, reinforces the economic negative dynamic. A host of uncertainties make predictions impossible, so instead he sketches the history behind the European Union’s present situation as a starting point for reflection.  Laqueur does so in what might be described best as a thematic discursive essay touching on questions ranging from immigration and demographics to how Russia, China and the United States provide a mirrors in which (some) Europeans see their own future.  Many of these points show how European integration involved a reaction to external preoccupations as well as Europe’s recent history, while other themes Laqueur addresses highlight the failure to react or even notice important developments.

The European Dream of unification and what seems to be its failure marks the backdrop to Laqueur’s reflections.  European integration during the 1990s offered a way to mobilize economic strength otherwise dissipated among nation-states themselves too small to exert global influence or secure access to energy resources beyond their frontiers.  It would solve the apparent problem of an economic giant remaining a political dwarf.  Social democracy, with some contribution from the corporatist approach of Rhineland capitalism, offered an alternative European model to the United States, let alone the former Soviet Union and authoritarian states in Asia.  It promised affluence without the glaring economic inequality critics associated with Anglo-Saxon capitalism, especially in America.  Politically, the European model looked to international law and multilateral organizations as an alternative to military force and hard power.  Romano Prodi, who then headed the European Commission, declared in 2001 that Europe had a role in world governance based upon replicating its own experience on a wider canvas.

A peace dividend with the end of the Cold War and the consequent globalization craze made such aspirations plausible.  Considerations of achieving the scale and scope to compete in a global economy provided one argument for integration. The momentum behind the European Union’s success in overcoming historical animosities carried equal or greater weight in public discourse as Prodi’s remark suggests.  Integration symbolized by adopting the Euro as a single currency appeared to have solved the German problem which had brought instability or war since 1871.  Rather than the Soviet collapse instigating a new struggle among European powers as some political scientists predicted, the 1990s saw a transition from nation-states to member-states which underlined that model of peaceful cooperation within a framework of law that many Europeans saw as their contribution to world order.  Europe’s twentieth century history made the contrast all the more sharp.

The European project as it became understood during 1990s had earlier roots that deserve attention in the context of Laqueur’s book.  Monnet had sought integration from the early post-1945 as a solution to the problems which had brought two traumatic wars. Europe divided meant an unstable Europe prone to war and political extremism. Hence his view that crisis would provide the political will to overcome domestic opposition.  Early steps like the European Coal Steel Community involved ceding sovereignty to secure joint objectives.  Germany could no long independently rearm as it had done in the 1930s.  Control over the resources in question had been a political concern in both world wars, and pooling them also offered a stimulus for economic production.  Other agreements on market access benefited manufacturing countries like Germany and the Netherlands that feared the exclusion of their exports.  Integration, especially when coupled with agricultural protection and transfer payments to impoverished regions like Southern Italy, proved beneficial.  Sustained economic growth and the consequent rise in living standards hid any costs.

Integration worked smoothly when it coincided with national interests and the economic well-being of voters.   Few observers remarked on the fact because nothing yet drew attention to it or suggested any tensions between integration and the interests of member states.  Only later did it become clear, as Laqueur notes, that “whenever the interests of the nation-state and Europe collided, the former always came first.”   Talk usually of a European community elided differences about what the phrase meant.  Charles de Gaulle’s concept of l’Europe des patries envisioned cooperation between national governments rather than ceding sovereignty to a supranational authority within a federal system as Monnet had in mind.  Moreover, France, West Germany, Italy, and the Benelux countries then formed a much tighter institutional Europe.  Expansion during the 1970s made consensus harder to reach, although transfer payments brought the European periphery higher living standards.  The end of Europe’s Cold War division then posed a choice between deepening the European Union through integration and widening its membership that nobody wanted to make.  Doing both—or at least making the attempt—made integration even more problematic.  The test would come when the interests of nation states and their citizens collided with Europe, and it seems clear that Europe has failed.

Laqueur points out that political support for European integration has faded.  A generation which saw it as a solution to twentieth century problems has passed from the scene and its successors lack that commitment to a European ideal.  Much support, however tepid, also reflected the fact that European integration seemed to go along with economic growth.  It made few demands upon the average person and brought some interests significant rewards.  Opposing what advocates sold as the wave of the future often appeared idiosyncratic or curmudgeonly.  Skepticism from that perspective seemed an exercise in nostalgia.  The argument that Europe had become a post-nationalist continent, however, went too far in downplaying loyalty to country and exaggerating cosmopolitanism.  Laqueur rightly notes that European nationalism presented by intellectuals like Jurgen Habermas lacks a wider constituency, and it certainly fails to arouse sufficient enthusiasm for significant change in political arrangements.  A more critical observer might question whether the position Habermas and Jacques Derrida take for a common European identity springs more from anti-Americanism and opposition to historic national cultures in Europe than any positive justification.  Insisting that there is no alternative to the plan, hardly amounts to an argument that will convince the doubtful, but it remains the strongest case amidst the present financial crisis.

The numbers of doubters has grown, and not just in response to economic hardship.  Because Europe lacks a people—and really operates by agreements among national governments and technocrats—the European Union cannot mobilize public support for integration.  Observers have noted the “democratic deficit” in Europe which leaves the public spectators in debates over their future.  The fear of populism from the interwar period became among technocrats a fear of the public itself.  Rather than engaging public opinion in an attempt to persuade, they have sought to put topics like immigration outside the parameters of legitimate debate.  Besides creating space for the kind of populism leaders hoped to exclude, that practice made it impossible to address serious problems honestly.  Laqueur frames his discussion of immigration and multiculturalism around this insight, and economic crisis only makes these questions more difficult to resolve.  Cynicism and political apathy have predictably followed.

The phrase “in theory” recurs in discussions of the European Union because arguments for greater integration logically set forth theoretical benefits of various steps.  Europe in theory can become a superpower and compete economically with the United States plus the rising powers of the two-thirds world.  Laqueur, however, points out that theory has failed to accommodate the reality of European circumstances.  Economics, culture, history, and deep institutional structures push in an opposite direction.  Attempting to overcome the past has only accelerated relative decline and made problems worse, and recent difficulties have only revealed the structural weakness behind the cracked façade.  Far from prompting further integration, crisis has brought a risky stalemate.  Laqueur ends with a question rather than answers.  Will Europe take care of itself?  Or is it, as Metternich famously said of Italy, merely a geographical expression.  Perhaps both are true.  Europe taking care of itself, however, may involve something very different from the dream of integration pushed since the 1950s.


The EU and Us

Having had my fun at the European Union’s expense, perhaps it’s time to move past Lufthansa jokes (although I do have a few more) and pay more serious attention to the EU and its federalism. There’s little room for American gloating or Schadenfreude: the ongoing EU disaster is hanging over our economy; and besides, our own federalism isn’t in such terrific shape, either. Read on to learn more.