The weak heart of Europe

The weak heart of Europe

Europe speaks many languages, but the language of global power is not one of them. Worse than political misfortune, this is historical carelessness, to paraphrase Oscar Wilde.

The new European Commission, under President Ursula von der Leyen, has raised the bar of global ambition, identifying itself as “geopolitical.” The previous Commission under Jean-Claude Juncker branded itself “political,” implying a cleverer management of the European Union’s poly-crisis – most notably the Greek crisis. Junker’s “political” Commission was successful in that the worst was averted. Will this Commission be equally successful?

The launch was far from ideal. From day one, Europe has had to deal with the consequences of US President Donald Trump’s unilateral initiatives: the abandonment of the Kurds and Turkey’s invasion of Syria; the Libyan crisis, where Turkey is also sending troops; and of course the cavalier assassination of General Qasem Soleimani by an American drone, which pulverized whatever was left of the JCPOA agreement on the Iranian nuclear program – one of the most important joint foreign policy achievements of the European Union and the Obama administration. Now Iran is heading undeterred toward accelerated completion of its nuclear program, and the Middle East is sliding into a new cycle of escalation.

To all this the European reaction was subdued, if any. In the absence of co-decision, the EU has been replaced by E3 formations (Britain, France, Germany), trying to salvage some semblance of a common European foreign policy.

This is a shame, because Europe remains a force of good on the planet. On key issues, such as tackling climate change, the EU is a global leader. The European Green Deal is the most ambitious such program ever to have been formulated, it spans a wide range of different policy areas, mobilizes markets, and responds to the concerns of European citizens. It is a plan Europe can be proud of. But in many ways, as is often the case, Brussels’ noble ambitions are grounded in the other European capitals.

The main factor of paralysis is the now dysfunctional relationship between Paris and Berlin. Close Franco-German cooperation has always been at the heart of European integration. No European leap has been made possible without the two countries working closely together.

President Emmanuel Macron, the only leader with a European vision, has been left without an interlocutor. Berlin accuses him of erratic grandstanding, but the blame lies mainly with Berlin. Macron proceeded with his domestic reforms, but Germany left him hanging in the eurozone. The eurozone’s “budget” is in name only. Banking integration and the common deposit insurance scheme are proceeding at glacial speed. The adoption of a common “safe asset” is in deep freeze.

Without further integration within the euro, Europe will not be able to convert its commercial weight into political influence and its single currency into a tool of economic might. It will remain defenseless against world powers that choose to weaponize their financial superiority and their global currency.

At the root of the problem lies the weakness of the German government. Firstly, because after a long period of growth, its economy is slowing down. Secondly, because the once dominant Chancellor Angela Merkel is on her way out, with the inevitable lame-duck status this entails. Thirdly, because of the weakness of the junior partner, who remains in the coalition out of fear that a withdrawal would lead to an even worse performance in the elections.

Even more profoundly, German weakness is rooted in the German model of economic competitiveness. Its economic growth driven by the dynamism of its exports, Germany has made itself extremely vulnerable to external pressures and fluctuations in global trade. Its huge trade surplus, a symbol of German economic dynamism, is paradoxically its source of weakness. And Europe’s weakness as well.

German exports and car factories in China make Germany susceptible to Chinese pressure on 5G. Beijing has threatened that if Berlin brands 5G a security threat, then China will retaliate by considering German cars hazardous. Massive German exports to the US render Berlin vulnerable to Trump’s blackmail, as long as Germany stands to lose the most from a trade war. And the size of German exports and investments in Turkey make Germany hesitant toward tighter sanctions for Ankara, even when these are needed to stamp out Turkish militarism in the region. Economic strength occasionally breeds political exhaustion.

George Pagoulatos is professor of European politics and economy at the Athens University of Economics and Business, and director general of the Hellenic Foundation for European & Foreign Policy (ELIAMEP).

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