23 August 2011
The recent proposals from Paris and Berlin on how to stem the Euro crisis quite clearly point to some form of fiscal union. Although it has made no appreciable difference to the volatility of global markets in recent days, it nevertheless suggests that the current economic crisis in Europe cannot be contained within the current Euro support mechanisms. The whole EU project is visibly under severe strain.
For those advocates of closer European integration, who have taken every opportunity to suggest that only deeper political and financial integration can stave off disaster, the move would suggest that things might be going their way. They conveniently overlook the fact that critics of monetary union had always predicted it would end in tears but speaking truth to truth has never been a European Union strength, with fudge and compromise more highly regarded than principle. Can the current economic crisis herald the beginning of a new era for the Union?
I don’t think so. The EU is in deep crisis at the moment and it is not simply a case of a shattered economic policy. The much-vaunted Schengen agreement is cracking under the strain of disunity over immigration – both legal and illegal. Enlargement, another key facet of EU policy is all but moribund with few, if any, calling for the admission of new members. Turning inwards for a new lease of life based on even deeper integration is simply ignoring the realities of life.
How long can it be before someone stands up and asks the awkward question about the position of democracy in all of this? When was the last time any popular movement in the EU called for further political integration? Which countries are queuing up to hand over their right to tax their citizens and control national spending? How far away from governance can people become before the concept of democratic accountability becomes meaningless?
This proposed move for Fiscal Union by Germany and France, should it ever come to fruition, will actually fragment the EU, not cement it. There is simply no way that all the existing members will accede to this scheme and we should now be thinking of a future EU with less cohesion and more nationalism, less solidarity and more self-interest.
Perhaps the time has come to admit that the high-tide of European political integration has passed and that the dreams and aspirations of a generation of post-war politicians have had their day. Maybe the time has come to consider what a looser concept of European integration might look like and what steps we need to take to make this a working reality.