The Stone City

Words Made to Last

Tuesday, April 26, 2005

Whose Side Is Europe On?

I had the good fortune to speak this week with a well-placed former politician, who has been peripherally involved with the European project. His optimism on Europe surprised me, and finally I dropped the pretense of neutrality and said something like:

Europe has tremendous structural problems. One: an ongoing demographic bust, which can be redressed only by taking in masses of uneducated, unassimilated and frankly uncivil immigrants. Two: dominant unions which mandate inefficient labor laws, preventing the reallocation of capital into growth industries and guaranteeing extremely high unemployment, especially among youth, thus creating an unskilled labor force. Three: generous welfare and pension guarantees which the countries cannot sustain in the face of the first two.

de facto European government being created in Brussels will be utterly unresponsive to these problems. First because it is dominated by its bureaucracy, and need not even notice public pressure; second because the corps of bureaucrats with lifetime employment will make Brussels itself recession-proof (buoyed by tax money from across the continent).

The Continental opponents of the European Union are the extremists on both sides. As Europe inevitably falls on hard times, these extremists will grow more powerful by blaming the ongoing economic malaise on the Union. As times get worse, they will grow stronger; victories in any one country will catalyze more of the same elsewhere. They will ineluctably grow strong enough to tear the Union down, and put something worse -- and far worse than the current system -- in its place.

Is the future of Europe not written plain for all to see? How could it end any other way?

The response I received (from someone who is better informed on EU politics than I) is worth noting. I will paraphrase it to the best of my ability.
There are indeed great structural inefficiencies in Europe. For example, Southern European governments still subsidize the growing of tobacco, which is then bought by the government and sold at a loss in places like India. The European Commission has been created with a mandate to promulgate free trade, which means getting rid of subsidies like that. They haven't yet had the power to do the job, because horse-trading between the individual nations can keep favored subsidies alive (not always: the forcible privatization of Iberia in 1995 is a success story for the EU). The effect of the constitution is to allow the bureaucrats to override national governments.

The situation with labor laws is similar. Union shops and restrictive work practices are barriers to the movement of people (another Commission mandate), and the constitution will give the bureaucracy power to prevent that. In this case, the hard left in Europe has it right: the constitution truly is an attempt to make Europe more Anglospheric.

What you see in Europe is an attempt to do something that has never been tried before: to create a supranational entity that is not a sovereign state (lacking powers for foreign policy, defense, and internal law and order), but helps make its members more prosperous. Of course there are a lot of problems -- just as, when America fought the cold war, there were problems like Vietnam and Chile -- but they are small compared to the scale of the things being done right.

I cannot share my respondent's sanguinity about a powerful bureaucracy, but he paints a very different picture of the European project than we have been accustomed to see.