The EU and the Greek Crisis: Courage to Confront the Real Issues?

May 9 marked the sixtieth anniversary of the speech by French foreign minister Robert Schuman in which he called for the unification of the coal and steel industries of Germany and France. A year later, the two countries signed an agreement that was to became the first building block in the construction of the European Union, which EU members have been working to complete ever since. At the foundation of Schuman’s historical proposal (which was immediately accepted by Chancellor Adenauer) were the assumptions that without French and German partnership nothing would be achieved in Europe, and that the first building block had to be economic rather than political. From an historical perspective, this enterprise became a success story (unprecedented in the blood-soaked annals of the European continent), worthy of admiration and emulation. The many expansions undergone by the EU since Schuman’s speech – from two states to twenty-seven – are evidence of the attractiveness of the concept of European integration.

Although the integration process has known several ups and downs, the Greek crisis is one of the most severe in the history of the EU. Even if the necessary steps were taken to help Greece begin the long and painful process of thorough housekeeping and at the same time prevent similar crises in the future by means of a financial package unprecedented in Europe’s economic history, uncertainty remains regarding the success of the specific move and the chance that it is possible to contain the crisis and prevent it from spilling over to other EU member states. It is still doubtful whether the steps taken will be enough to prevent the repetition of crises like the Greek crisis or the emergence of similar episodes.

In a paper prepared thirty years ago on the future of Europe, Belgian prime minister Tindemans claimed: “a house constructed perfectly in only one of its parts cannot stand.” Does this assessment by one of the most fervent supporters of a united Europe foretell the future? What is clear is that the current crisis is a symptom of a long list of problems at the political-economic and institutional levels plaguing the EU for a long time that fundamentally reflect the inability (absent any political will) to solve them. Does the EU in its present format require decisions about continuing down the same road, without which EU attractiveness as well as its relevance as an influential player in the global balance of power will diminish? The answer is yes. Will the necessary decisions in fact be made in the foreseeable future? That is highly doubtful.

An expression of the sense that Europe is finding itself in uncharted territory was given by Chancellor Merkel on May 5, 2010 in the Bundestag during a discussion on approval of the financial package for Greece: “The decision that will be reached in Germany will recognize the political-historical dimension of the situation." In addition, “Rarely one finds oneself in a situation that historically has no precedent and that has ramifications for the moment as well as for the future of Germany and all of Europe.” She added that Germany is now at a crossroads.

The crisis is also an opportunity to make decisions that recognize the political-historical aspect of the moment. To this end, Europe’s leadership has to be willing to risk making unpopular decisions if it is in fact committed to completing the construction of the EU edifice. The manner in which the EU leadership (both at the national level and at the level of the EU institutions) has confronted the crisis does not seem to indicate that that is the case. It is one thing to accept a string of decisions made by the European Economic and Monetary Union regarding the steps to prevent a recurrence of the Greek crisis (such as the establishment of an emergency fund to prevent the spread of the crisis and the formulation of a series of penalties against states that fail to meet their obligations as EU members). However, it is quite another to accept major decisions such as fiscal union and further expansion of economic integration whose importance goes beyond giving first aid and preventing the spread of the disease. In order to make these decisions, there must be willingness to take significant steps toward political integration, meaning significant concessions in components of member nations’ national sovereignty. In the present circumstances, such willingness seems farfetched; the EU larger member states have shown little in recent years.

Instead, for quite some time we have witnessed a process of national assertiveness at the cost of advancing Europe’s interests. Germany serves as a good example. A turning point in its attitude to European integration started when a Social Democratic chancellor, Schroeder, was elected in 1998. He differed from his predecessor, Helmut Kohl, who was a member of the generation of politicians who had internalized the lessons of World War II and the defeat of Germany. Alongside his striving for the Europization of Germany, Kohl was also prepared to pay for the advancement of the idea of European integration with German currency. The unification of the currency was to become one of the cornerstones in advancing his task. By contrast, the end of the Cold War, the unification of Germany, and its subsequent striving for normalcy in the European arena made Schroeder set limits on his country’s willingness to continue paying German currency for the sake of European integration. His statement that German interests would be defined in Berlin, not Brussels, reflects the rise of the nationalist component in the set of considerations that has guided Germany since then. In this sense, Chancellor Merkel’s approach expresses continuity of Schroeder’s line rather than a return to Kohl’s. President Sarkozy (like his predecessor Chirac), alongside the lip service he pays to continue the process of integration, conducts a policy that gives clear preference, especially in times of economic crisis, to the national interest over the pan-European one. Even more extreme in its approach is Great Britain, which historically has preferred national over pan-European considerations.

The crisis has emphasized (not for the first time) the lack of support for the idea of integration among EU citizens. The lack of interest demonstrated by the political elite of the member states in EU institutions and the caliber of the politicians sent to represent their nations, alongside the sense of distance and irrelevance that Europe’s citizens feel towards the bureaucrats in Brussels, leave their imprint in the low rates of voter turnout in EU parliamentary elections. Given this situation, national leaderships do not feel any pressure to advance integration in order to surmount obstacles. Attentive to the desires of the public, the political leaderships are tempted to adopt nationalist stances rather than pan-European ones in response to the crisis. For this, they are rewarded with widespread public support.

Anxiety about undermining the stability of the euro and concern that possible ramifications of the Greek crisis are not being addressed by the leading economies (primarily Germany and France) have pushed the leaders of these states to identify the crisis and prevent its possible repetition. Particularistic interests rather than collective ones have guided the leaders of the large states in their handling of the issue. Because the Greek crisis is a symptom of a disease, the way to handle it must be structural rather than piecemeal. This is well known to EU leaders, but their political will here is lacking. As long as this remains the case, the EU may be expected to have to cope with similar crises in the future that will again place national interests before pan-European ones, with all that this entails for the character of the EU. Outwardly, the EU may be expected to continue to lose significance as a relevant player in the global game.