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Sunday, November 20, 2011

A continent over the Euro virus


By Swapan Dasgupta

How many of us can honestly admit to not being envious of a passport holder of a European Union country? The charm of being able to ride the Eurostar to Paris on an impulse, the delights of visa-less travel from Scotland to Sardinia, the luxury of being to live and work in Dublin or even Gdansk, and the comforts of a single currency—these were the ideas that captivated the world from the early-1990s. The EU was the archetypal cosmopolitan ideal that overwhelmed successive generations seeking antidotes to national boundaries and narrow nationalisms.

It was fashionable to be committed to a EU that, in time, and despite the misgivings of Little Englanders, would herald a true fiscal and political union. The generously paid Eurocrats in Brussels and Strasbourg were committed to the civilising mission of a Europe based on uniformity—the uniformity of a single currency, one market and, above all, of progressive social legislation based on exaggerated notions of human vulnerability. Having created a transnational utopia from the debris of a war-ravaged continent, Europe imagined it had earned itself the right to be preachy and sanctimonious to the lesser world.

Yet, few expected the bubble would be so close to bursting. In the past two months, a sickness that had first emerged in Ireland and the Iberian Peninsula is threatening to overwhelm Greece, Italy and, in time, even France. Coming in the wake of an American crisis, the epidemic is threatening to destroy the cosy assumptions of the past 20 years. Unchecked, it may even trigger the “final crisis of capitalism” Marxists have been fantasising since 1914.

Prophets of doom have traditionally jumped the gun. The latest Euro-zone crisis may yet lend itself to a patchwork solution that preserves the essence of the EU while ridding it of grandiose embellishments. However, for that to happen, the captains of the EU have to get off their high horse and recognise basic realities.

The first is the belief that national sovereignty can coexist harmoniously with the stated purposes of the EU. It just can’t. Greece can’t pretend it can continue merrily with its inefficient public sector and Italy can’t pretend that it can afford to persist with its elaborate welfare state. To live in a monetary union involves accepting a rule-based fiscal system that rejects financial profligacy.

This is a difficult decision and involves defining the limits of democracy. The removal of the elected prime ministers of Greece and Italy by technocrats who have never even contested municipal elections is ominous. As a stop-gap measure to tide over a crisis this may well be unavoidable. But since the austerity measures are deeply unpopular in both the countries—and, indeed, in the other countries affected by the Euro virus—how long before political exasperation forces a return of cussed nationalism?

For the moment, Germany and Angela Merkel have been portrayed as the villains of the game and anti-German feeling is rampant all over Europe. German voters in turn are asking why they should be subsidising the spendthrift ways of their European cousins and, at the same time, be ruthlessly vilified for doing so. Will the clash of nationalism lead to the unravelling of the EU experiment?

This is not necessarily a doomsday scenario. Although the original European Economic Community was created at the initiative of France and the Scandinavian countries to keep the ambitions of a divided Germany within the bounds of economics, the past decade has seen united Germany outstrip its fellow Europeans. Without any doubt Germany has emerged as the driving force of the European economy. In terms of creativity and entrepreneurship it has left the rest of Europe far behind. Without Germany, the EU is meaningless.

However, for the rest of Europe to recognise the leadership of Germany is a very tall order. The burden of history, particularly the 12-year aberration of the Third Reich, has a tendency of intruding into the consciousness of the present.

Germany may have repackaged itself as a benign first among equals but it is confronted by a challenge that economic good sense is powerless to confront: the irrational self-esteem that nationalism breeds in the less successful.


Sunday Times of India, November 20, 2011 

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