One day we will forget that the EU still exists

The tragedy of Europe is well illustrated by the bench with the boats and the helicopter. A priest is surprised by a flood. A boat is approaching, ready to take it. He refuses, saying that God will save him. The waters become even more angry. An engine boat comes, but the priest refuses. Then a helicopter comes, and the priest refuses. Eventually it drowns. He arrives in Heaven and asks God why not help him. « I sent you two boats and a helicopter. What did you want to do? ». God sent to Europe a crisis of sovereign debts, a pandemic and Vladimir Putin. And Europe said: « No, thank you. We will join when a crisis comes »writes Wolfgang Munchau, for Eurointelligence.

« The story of Europe does not yet have a denouement. We are still in progress. But I expect the end to not be the union in which the pro-European people believe. I believe that today’s Europe is in the position of the Habsburg Empire in its last years-rich, tired, intellectual, cultural but doomed to failure. Economic and foreign policy problems of Europe are uninteresting.

If you are to ask me why Europe needs now, I would say that all of the above and more than that. The above ideas were not supported by any majority in their time. Not even the most shy proposals – to remember « red bonds » and « blue bonds ». No one dared to talk about the things he really needed. All these ideas, bolder or more timid have failed because the Member States did not want to give up the slightest slice of sovereignty. If we want to face what comes to us from the US and China, we should apply the hardest version of the reforms then.

But in this decade, Europe’s ambition has reduced a lot. The unique market that Europe always speaks is not what it seems. According to the IMF, internal barriers in the EU are higher than Trump’s rates. And, after giving up halfway to the single market and the Economic Union, the EU is now heading to another project to abandon in half-Defense Europe.

I think that the moment when the EU integration died was the summer of 2012, at the height of the Sovereign debt crisis, when the EU leaders ceased a political and fiscal union and went to the variant of a bailout from the European Central Bank. Until 2012, the Fiscal Union was a possible scenario for the EU. Now we talk about creating a capital market union, but what is the point? There can be no such thing without a tax union and without a tool of sovereign debt. The latter two require at least a small political union. There are no technical solutions to bypass these things.

The EU has resigned with the idea that it becomes a union based on rules that have the main activity transfer of payments. So much. There is no direct way from where we are now to a political union and there is no point in pretending that we have an integrated economy and a capital market. It may appear something that will claim to be a union of capital markets, but will not be able to direct the economies of the private sector to profitable investments. This will not be seen in the national budgets. As no one saw EU funds for economic relaunch in macroeconomic statistics.

The choice that the EU will make will have long -term consequences. Europe will remain behind from a technological point of view, of innovation, business opportunities, productivity and the rest of the indications that measure the economy. It will remain behind because all these need a truly free market for goods, services and capital. Europe does not need a political union to complete the unique market. It needs a political union because without it there can be a unique market.

Even if the EU project fails, Europe will remain a beautiful place to live, just like Austria before the First World War. The Habsburg Empire broke violently because it slipped into a war. I’m not saying the EU will have the same fate. But I do not exclude this, given the military feeling in the European capitals. The analogy with the Habsburg Empire ends at the level of the year in 1914.

Further, the Member States will take over the decision -making power and will undermine the unique EU market and the competition policy. The new coalition in Germany has just reformed the national tax rules without any coordination with European partners. They did the same with the subsidies granted to companies to pay her electricity, they hope to find a way to bypass the European rules and objections from other Member States. Maybe they will find such a way. Each Member State will find a way to bypass the others. One day we will forget that the EU still exists.