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At Large
So Much for the European Project
The question is not so much can Europe match the U.S. as can it survive at all?
Europe was supposed to have arrived. With the final approval of the Lisbon Treaty last year, the European Union sported a new, consolidated government. Europe’s political elite believed it had answered Secretary of State Henry Kissinger’s derisive question: what is the phone number for Europe?
But continental politics remains chaotic and European nations are tottering economically. The European Union’s future is now at risk. The question no longer is whether the EU can match the United States, but whether it can survive.
Even as Europe came to dominate the globe the continent remained fragmented into warring states and peoples. After World War II European integration was seen as the best means of solving “the German problem.” The beginning was the European Coal and Steel Community in 1951, eventually evolving into the European Union. Still, the “European Project” remained incomplete.
Europe’s collective GDP and population exceed those of America. Despite its economic heft, however, the continent long has been a geopolitical nullity. Charles Grant, director of the Centre for European Reform, complained: “On many of the world’s big security problems, the EU is close to irrelevant.”
The answer: give the continent an effective government. Hence the Lisbon Treaty.
Lisbon created a president and foreign minister, reduced the influence of national governments, and expanded the powers of the European Parliament. It took the Eurocratic elite, whose insider status transcends ideological differences, a few years to overcome popular opposition to the new plan, but late last year the new super EU emerged. Herman van Rompuy was chosen president of the European Council and the Baroness Catherine Ashton was selected as the High Representative for Foreign Affairs.
Yet Lisbon delivered bureaucratic confusion rather than continental clarity. Van Rompuy is president of the European Council, but the Lisbon Treaty failed to dispense with the rotating six-month EU presidency held by governments, now Belgium. There also is a president of the European Commission, Jose Manuel Barroso. Ashton found herself limited both by the demands of member governments and the newly empowered European Parliament.
The different organs of EU power have battled over which represents Europe in international forums and signs letters to the UN. The European governments, European Commission, and European Parliament have sparred over who should take the lead in exercising greater oversight of member finances. Van Rompuy and Barroso fought over who would represent Europe at the G-20 meeting. Reports Jennifer Rankin for European Voice: “Each of the EU’s institutions attaches a very different weight to the treaty.”
So much for turning Europe into a Weltmacht. Despite the Lisbon Treaty, a United States of Europe the EU is not.
George Will observed: “The European Union has a flag no one salutes, an anthem no one sings, a president no one can name, a parliament (in Strasbourg) no one other than its members wants to have power (which must subtract from the powers of national legislatures), a capital (Brussels) of coagulated bureaucracy no one admires or controls, a currency that presupposes what neither does nor should nor soon will exist (a European central government), and rules of fiscal behavior that no member has been penalized for ignoring.”
Europe’s economic travails pose another challenge. Sixteen of the EU’s 27 members belong to the Eurozone, which sports a common currency. Alas, the lack of a common fiscal policy means the continent’s financially prudent economic powerhouse, Germany, is yoked to shameless spendthrifts such as Greece and Italy. Everyone knew that the Eurozone’s weak sisters lied about their finances, disguising deficits and debts. Until now no one cared.
But the Greek government’s financial wizards could no longer hide the truth and default loomed. Letting the Greeks come to terms with their creditors was the obvious answer. Alas, those creditors included French and German banks, which apparently never entertained the possibility that a euro government wouldn’t be able to pay its bills.
Expelling Athens from the Eurozone was another option. But the euro is a political as well as an economic institution. Warned German Chancellor Angela Merkel: “If the euro fails it’s not just the currency that fails, but Europe and the idea of European unification.”
So rather than hold irresponsible spendthrifts accountable and respect the no bailout provisions of EU treaties, the organization rushed to Greece’s aid. But that has turned out to be merely the start rather than the end of the crisis.
A Greek economic crash merely has been postponed. Athens will likely have to restructure its debt at some point. With $420 billion in sovereign debt, a Greek default would be the largest such bust in history.
About the Author
Doug Bandow is a senior fellow at the Cato Institute. A former Special Assistant to President Ronald Reagan, he is the author and editor of several books, including The Politics of Plunder: Misgovernment in Washington (Transaction).
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JimP| 7.7.10 @ 8:16AM
I guess this proves that it takes more than a 'union of states' to be an economic or political power. The only thing standing in the way of European countries each being another Singapore are their policies. A union of socialist states was already tried and failed (the USSR). But, Europe gave us multiple world wars, why not another failed socialist 'union'? If Obama & the Dems succeed in turning all of the U.S. into Detroit, Europe will be looking good in comparison. Parlez vous Francais mes amis?
Stuart Koehl| 7.7.10 @ 8:50AM
It is seldom that I agree with Doug Bandow on anything (I not being inclined to doctrinaire libertarianism), but this is one of those cases. Having been immersed in EU affairs since 2004, the more I see of this abortive union, the less I like of it. My own perception is the EU may not formally break apart, but it will become increasingly irrelevant as more countries buck against the goad of its onerous regulatory burden, and begin to go their separate ways in the name of national survival.
The EU was not and is not popular among ordinary citizens of the individual member countries. While they like the freebies that come with membership, they resent the intrusions into their daily lives. I have yet to meet a Briton, Frenchman, German, Italian, Swede, Pole or Romanian who actually thought of himself as a "European". The principal supporters of this experiment in transnationalism gone horribly wrong is a small technocratic elite that has, by seizing control of the bureaucratic apparatus of the member states, managed to impose the union upon an unwilling populace.
Since the EU has not been able to provide security, and is increasingly incapable of ensuring prosperity, and has done nothing to gain the allegiance of the people it pretends to represent, it is only a matter of time before a nationalist backlash sweeps it away, or causes it to revert back to the common market whence it came. May that day come soon.
Rodney T Walton| 7.9.10 @ 12:35AM
Doug Bandon is so right. Before the American Civil War most people thought of themselves as Mainers or Alabamians. And they were mostly white Protestants from English or Scotts/Irish stock. After the Civil War, people began to see themselves as Americans. But in Europe as I travel there all the people I meet are Poles, Germans, Danes, ect. They are not one people and never will be. I think there is coming in Europe a movement back to small nationalism & small countries. And why not? They've got America to do all the heavy lifting in world security. They're going to have enough problems with all the muslim immigrants living there. I'm just glad our invasion from Mexico & Central America is by people that are Catholics!
Louis Jenkins| 7.7.10 @ 9:10AM
The EU will fail. It cannot ensure economic prosperity, nor provide security. It presents itself as just another layer of goverment over top of a national government. Thank the Lord that, for now, we only have our government to content with. We'd do well to observe and take to heart the lessons that this mess has shown.
jomo2009| 7.7.10 @ 3:02PM
Given the fact that Europe no longer faces an existential threat like the old Soviet Union, the time is ripe for the US to pull out of NATO and leave the continent and their squabbling components to their own devices. The savings would amount to the hundreds of billions of dollars over the next ten years; the US troops could certainly be used elsewhere and we would no longer have to take into consideration European "sensibilities" when determining American foreign policy.
Archibald Bomwitz| 7.7.10 @ 4:19PM
Doug, you American conservatives should concentrate on saving your own country, not have wet dreams about Europe failing. No, I am not talking about your "president" I am talking about your totally dysfunctional society with clueless liberals and conservatives.
Stuart Koehl| 7.7.10 @ 4:30PM
That was helpful. Please do come again.
JimE| 7.7.10 @ 11:36PM
Arch, How's that islamic thing working out for you?
Curly Smith| 7.7.10 @ 5:26PM
We should call the EU what it is - USSR II. The EU Constitution says that all powers not specifically delegated to the people belong to the government, whereas our Constitution still says (7/7/10 at 4:30 PM CDT) that the powers not delegated to government belong to the people. The EU is simply another "expert" run system that failed. Not to worry though, by the time Obama's finished the EU may look like a very successful enterprise.
jstwndring| 7.8.10 @ 1:36AM
Collectivism looks good to the naive--until the bill comes.
Andrew Warren| 7.13.10 @ 8:10AM
EXTRACT FROM ABOVE:University of Chicago economist John H. Cochrane bluntly predicts: "barring a fiscal and growth miracle, we will either see sovereign defaults (larger and more chaotic for having been postponed) or the ECB [European Central Bank] will have to print euros to buy worthless debt, leading to widespread inflation."
Tell you what. Go back to this self-appointed guru in five years time. And ask him to explain why none of his predictions came true.