A challenge that Europe cannot afford to miss
The decision by European Commission President Jose Manuel Barroso to announce a program of significant reforms designed to promote growth in the EU is a welcome message after Romano Prodi’s unremarkable time as Commission head. More importantly, it provides a new chance for Europe to act as an independent global leader. It is not by chance that the European press lauded Barroso’s plans last week. A day before he made his announcements, Barroso made it clear, at a dinner with top Brussels businesspeople, what the reforms mean. The effort to boost the European economy is, deep down, also an effort for Europe to preserve its own autonomy and welfare state culture. In essence, Barroso’s policy, in the formulation of which he had the ample support of France and Germany, is the following: Europe’s future as a superpower rests on two pillars: the first being the economy, which has slowly lost its competitiveness and dynamism, leaving it to the United States and several Asian countries to conquer global markets. The second pillar is the social model, which is far superior to that of the US and achieves higher levels of social solidarity and cohesion. In Europe, said Barroso, the states spend almost 20 percent of their budget on education and health. The US spends almost nothing, leaving it to the citizens themselves to shoulder the burden. Therefore, do we or do we not wish to retain this superior social model? If the answer is «yes,» says Barroso, we must reform the economic pillar and render it as competitive as the US’s, sooner rather than later. If we fail to resume growth and boost employment, the social pillar, which provides Europe with its unique identity, will collapse. To avoid this, we must implement bold economic reforms. As Alexis de Tocqueville warned almost 170 years ago, the only danger for democratic societies is stagnation. To help these reforms, we must lift legal obstacles to entrepreneurship, complete the integration of the internal market and stick to a few priority actions, such as investment in education, research and innovation. This will also help large European enterprises to compete globally with the US behemoths. This development is crucial for Europe – witness Airbus’s surge ahead of Boeing in the passenger aircraft sector – while it would be foolish not to seek the necessary mergers and strategies. What the Commission president failed to mention is the lack of an EU-wide mechanism to enforce reform on member states. He and his 24 fellow commissioners must use their political and diplomatic skills to the fullest in order to convince member states that structural reforms are more than ever a one-way street and that they ought to ignore political costs at national level in order to move, decisively and in concert, to build a strong and unified Europe. If growth can accelerate, then European citizens can also maintain the, admittedly expensive, social and environmental policies they have come to expect.
