Echoes Of The Past In The Debate Over Europe's Future

by Adriano Bosoni

The European Union is thinking about the kind of bloc it wants to be. As EU members consider a range of reforms - including measures to help the eurozone better withstand crisis and to make European institutions more efficient - the underlying question is whether the bloc should become a federal superstate. The conversation isn't a new one for the Continent. But given the many challenges facing the bloc, and the differing priorities among its members, the latest iteration of the federalism discussion could deepen the divides among the European Union's constituent states.

Overcoming Geography and History

Europe's divisions are a product of its geography. The mountain chains, unconnected rivers and peninsulas that characterize the Continent have enabled multiple economic centers to emerge and thrive. Over the centuries, these various hubs have given rise to dozens of nation-states, each with its own strong identity, and many with expansionist ambitions. European history offers several examples of the integration of small political entities into larger units, but the process usually happened by conquest. In that sense, the European Union represents a radical departure for the Continent, because it seeks to unite Europe's many components by consensus instead. Whether the bloc's bold political experiment can overcome the Continent's natural tendency toward fragmentation is far from settled.

Germany's own experience with integration may provide some insight into the question. In 1871, several small entities came together to form the German Empire after a decadeslong unification process that included the elimination of trade barriers and the establishment of a customs union not unlike the EU single market. The country became a modern nation-state within just a few years despite the cultural, linguistic and religious differences among its constituent territories. German unification, however, didn't come about solely because of political negotiations and freer trade; it took a series of wars to bring the country together and to forge a national identity.

Defenders of European integration argue that the Continent, likewise, endured its foundational conflict during World War II. But an event that took place seven decades ago may not be enough to drive the bloc's members together and build a common European identity in the 21st century. Though many Europeans see themselves both as citizens of their country and as citizens of the European Union, their primary identities and loyalties lie at the national or even the local level. For that reason, issues such as transferring financial resources from wealthy to poorer EU member states or creating a common European army are still controversial.

Getting Back to the Question

That's where the idea of federalism comes in. Proponents of a federalist model for the Continent argue that drawing Europe's many states together under a central authority is the way to overcome its divisions. Under this system, member countries would cede their sovereignty to strong, centralized institutions. Some of the reforms currently under discussion - such as a common deposit insurance for eurozone banks and the integration of Europe's capital markets - promote greater federalization, a process that supporters maintain has already begun anyway and will strengthen the European Union.

Detractors, however, hold that Europe is too diverse to become a federal superstate and that the problems in the bloc trace back to its insistence on reconciling the differences of countries with varying interests and priorities. Some even argue that the European Union has federalized against the will of its members states' people in a bid to replace national identities with an artifical pan-European one. Rather than constantly trying to accommodate the disparate needs of countries such as Germany and Greece, anti-federalists contend, the European Union should simply accept that its members are intrinsically different and adopt a simpler model to reflect that reality. They do not necessarily want to do away with the bloc but would prefer it to function as a loose association of sovereign nations that cooperate on matters of mutual interest.

The future of European federalism has proved a divisive topic among, and within, EU member states. Although at first glance eurozone members may seem more amenable to federalism, having already abandoned their national currencies in the interests of integration, founding states such as France, Italy and Germany are home to large Euroskeptic movements. Plenty of voters in states outside the eurozone, such as Poland and Hungary, on the other hand, want to forge closer ties with the bloc, notwithstanding their governments' Euroskeptic policies.

The Debates to Come

As EU leaders try to hash out a future for the bloc, the enduring divisions among the Continent's various countries will complicate the negotiations. Apart from their diverging views on federalism, the European Union's members also vary in their political and economic beliefs. The countries of Southern Europe tend to favor protectionist trade policies, tolerate inflation and embrace increased spending and risk sharing in the bloc. By contrast, Northern European states typically defend their national wealth, oppose protectionism and insist on greater oversight of their southern peers' finances before the bloc moves forward with integration.

Once the European Union has settled on what reforms to implement, moreover, it will still have to determine which countries to include in the measures. France - which along with Germany forms the core of the bloc - has suggested that a small group of member states can move ahead with integration even if others are unwilling or unable to join them. Germany, however, wants to ensure the broadest possible consensus behind the reforms, even if achieving it means slowly enacting modest changes. Since most of the countries that France is willing to exclude from the next stage of EU integration are in Central and Eastern Europe, Berlin is concerned that Paris' plan will cause a rift between these states and Western Europe. The fracture could gradually reduce the European Union's influence in the region, perhape leading to political instability and economic stagnation that, in turn, could enable outside powers such as Russia or China to increase their sway there. Yet the alternative is far from ideal. While France's proposal could break the European Union apart, Germany's could lead to inefficient compromises for the sake of unity.

The countries of Central and Eastern Europe, meanwhile, are pondering questions of their own. Many of these states are outside the eurozone and exempt from several of the reforms under consideration. Even so, the entire region will face an existential dilemma: to join Western Europe in its quest for deeper integration, perhaps at a greater expense to their national sovereignty, or to resist, perhaps at the risk of isolation.

Even if the European Union emerges from these negotiations intact, the debates that come next will prove still more challenging for the bloc. The European Union, for example, will have to look for ways to remain relevant in global affairs in the years ahead. Issues such as immigration from sub-Saharan Africa and the Middle East, trade competition from East Asia, China's growing influence and Russia's growing assertiveness highlight the bloc's vulnerability to economic, political and social developments beyond its control. Political fragmentation could hinder the bloc's ability to confront these challenges and shape its own future.

What's more, the Continent will have to tackle these concerns while also dealing with a range of internal problems, including aging populations, low economic growth and steadily decreasing defense spending. And in the meantime, the European Union will weather the upheaval of losing a member, the United Kingdom. The Brexit will leave the bloc with a smaller economy and without one of its few truly global powers.

More than a half-century since its creation, the European Union is again facing a quandary that has plagued the Continent throughout its history: how to negotiate the differences among its many countries. The bloc probably won't become a federal superstate anytime soon. Nevertheless, its leaders will continue to spend considerable time and energy looking for ways to stay together. And as the bloc confronts more novel challenges in the coming years, achieving this perennial objective will become increasingly difficult.

"Echoes of the Past in the Debate Over Europe's Future" is republished with permission of Stratfor.