Today’s European Union needs both salvation and radical reinvention. Saving the EU must take precedence, because Europe is in existential danger. But, as French President Emmanuel Macron emphasized during his election campaign, reviving the support that the EU used to enjoy is no less essential.
The existential danger the EU faces is partly external. The Union is surrounded by powers that are hostile to what it stands for – Vladimir Putin’s Russia, Recep Tayyip Erdoğan’s Turkey, Abdel Fattah El-Sisi’s Egypt, and the America that Donald Trump would create if he could.
But the threat also comes from within. The EU is governed by treaties that, following the financial crisis of 2008, became largely irrelevant to conditions prevailing in the eurozone. Even the simplest innovations necessary to make the single currency sustainable could be introduced only by intergovernmental arrangements outside the existing treaties. And, as the functioning of European institutions became increasingly complicated, the EU itself gradually became dysfunctional in some ways.
The eurozone in particular became the exact opposite of what was originally intended. The EU was meant to be a voluntary association of like-minded states that were willing to surrender part of their sovereignty for the common good. After the 2008 financial crisis, the eurozone was transformed into an arrangement whereby creditor countries dictated terms to debtor countries that couldn’t meet their obligations. By dictating austerity, the creditors made it practically impossible for the debtors to grow their way out of their liabilities.
If the EU carries on with business as usual, there is little hope for improvement. That is why the Union needs to be radically reinvented. The top-down approach that Jean Monnet used to launch European integration in the 1950s carried the process a long way, before losing momentum. Now Europe needs a collaborative effort that combines the EU institutions’ top-down approach with the bottom-up initiatives needed to engage the electorate.
Consider Brexit, which is certain to be immensely damaging to both sides. Negotiating the separation with Britain will divert the EU’s attention from its own existential crisis, and the talks are bound to last longer than the two years allotted to them. Five years seems more likely – an eternity in politics, especially in revolutionary times like the present.
The EU should therefore approach the Brexit negotiations in a constructive spirit, recognising the unpredictability of the future. During the prolonged “divorce” process, the British public could decide that being part of the EU is more attractive than leaving it. But this scenario presupposes that the EU transforms itself into an organisation that other countries such as Britain want to join, and that people on both sides of the English Channel have a change of heart.
The chances that both conditions will be met are slim, but not zero. It would require EU-wide recognition that Brexit is a step toward European disintegration – and thus a lose-lose proposition. By contrast, making the EU attractive again would give people, particularly the younger generations, hope for a better future.
Such a Europe would differ from the current arrangement in two key respects. First, it would clearly distinguish between the EU and the eurozone. Second, it would recognise that the eurozone is governed by outdated treaties, and that its governance cannot be altered because treaty change is impossible.
The treaties assert that all member countries are expected to join the euro if and when they qualify. This has created an absurd situation where countries like Sweden, Poland, and the Czech Republic have made it clear that they have no intention of joining the euro, yet they are still described and treated as “pre-ins.”
The effect is not purely cosmetic. The EU has become an organization in which the eurozone constitutes the inner core and the other members are relegated to an inferior position. This must change. The euro’s many unresolved problems must not be allowed to destroy the EU.
The failure to clarify the relationship between the euro and the EU reflects a broader defect: the assumption that various member states may be moving at different speeds but are all headed toward the same destination. In fact, a rising proportion of member states have explicitly rejected the claim of “ever closer union.”
Replacing a “multi-speed” Europe with a “multi-track” Europe that allows member states a wider variety of democratic choices would have a far-reaching beneficial effect. As it stands, member states want to reassert their sovereignty, rather than surrendering more of it. But if cooperation produced positive results, attitudes might improve and objectives pursued by coalitions of the willing might attract universal participation.
Meaningful progress is indispensable in three areas: territorial disintegration, exemplified by Brexit; the refugee crisis; and the lack of adequate economic growth. On all three issues, Europe starts from a very low base of cooperation.
That base is particularly low when it comes to the refugee crisis, and the trend is downward. Europe still lacks a comprehensive migration policy. Each country pursues what it perceives to be its national interest, often working against the interests of other member states as a result. German Chancellor Angela Merkel was right: the refugee crisis could destroy the EU. But we must not give up. If Europe could make meaningful progress on alleviating the refugee crisis, the momentum would change to a positive direction.
I am a great believer in momentum. Even before Macron’s election, beginning with the convincing defeat of the Dutch nationalist Geert Wilders in the Netherlands’ general elections in March, one could see momentum developing that could change the EU’s top-down political process for the better. And with Macron, the only pro-European candidate, winning in France, I am much more confident about the outcome of Germany’s election in September. There, many combinations could lead to a pro-European coalition, especially if support for the anti-European and xenophobic Alternative für Deutschland continues to collapse. This growing pro-Europe momentum may then be strong enough to overcome the biggest threat: a banking and migration crisis in Italy.
I am also encouraged by the spontaneous, grassroots initiatives – most supported mainly by young people – that we see nowadays. I have in mind the “Pulse of Europe” movement, which started in Frankfurt in November and spread to some 120 cities across the continent; the “Best for Britain” movement in the UK; and the resistance to the ruling Law and Justice Party in Poland, and to Prime Minister Viktor Orbán’s Fidesz party in Hungary.
The resistance in Hungary must be as surprising to Orbán as it is to me. Orbán has sought to frame his policies as a personal conflict with me, making me the target of his government’s unrelenting propaganda campaign. He casts himself as the defender of Hungarian sovereignty and me as a currency speculator who uses his money to flood Europe with illegal immigrants as part of some vague but nefarious plot.
But the truth is that I am the proud founder of Central European University, which, after 26 years, has come to rank among the world’s top 50 universities in many of the social sciences. By endowing CEU, I have enabled it to defend its academic freedom from outside interference, whether by the Hungarian government or anyone else (including its founder).
I have learned two lessons from this experience. First, it is not enough to rely on the rule of law to defend open societies; you must also stand up for what you believe. The CEU and my foundations’ grantees are doing so. Their fate is in the balance. But I am confident that their determined defense of academic freedom and freedom of association will eventually set in motion Europe’s slow-moving wheels of justice.
Second, I have learned that democracy can’t be imposed from the outside; it needs to be achieved and defended by the people themselves. I admire the courageous way Hungarians have resisted the deception and corruption of the mafia state Orbán has established, and I am encouraged by the European institutions’ energetic response to the challenges emanating from Poland and Hungary. While the path ahead is perilous, I can clearly see in such struggles the prospect of the EU’s revival. - Project Syndicate