CURRENT EVENTS
HARD TIMES

EUROPE, THE
END OF A DREAM?
Greece is on the verge of collapse. Financial speculation abounds. The European Union is defending itself with plans costing billions to shore up against a wave that threatens to overwhelm the euro and other countries. We spoke with LUDGER KÜHNHARDT, Director of the Center for Studies on European Integration, who explained the root of the weak euro, and the point of departure for starting again: “Rediscovering a treasure we forgot that we had.”

by Davide Perillo

In the beginning, there was the fraud, the one that for years falsified Greece’s national finances, in spite of European restrictions (and supposed but nonexistent monitoring). But when the long wave began rolling, bringing Athens to the brink of bankruptcy, few realized that, this time, the crisis truly threatened to overwhelm everything: the euro, attacked suddenly by speculators; the PIGS (the countries at risk: Portugal, Ireland, Greece, and Spain); and all of Europe, which had to patch things together with a 750 billion euro megaplan, crossing fingers and waiting for developments that at the moment are unpredictable, because the stock markets are dancing and the crisis is once again closing in.
The build-up has been monitored for years by Ludger Kühnhardt, political scientist, economist, Director of the Center for Studies on European Integration in Bonn and professor at half a dozen universities throughout the world. Asked whether this is a crisis of the euro or of Europe, and whether it can be explained simply in terms of technical reasons and attacks by stock market speculators, he replies, “No. The crisis is much deeper. It is the result of an economic integration without political integration. In the last 50 to 60 years, we’ve built the European institutions but we haven’t given birth to the European. We have a common currency without a truly effective common policy system. Then, there’s another aspect.”

What is it?
Solidarity among European countries is not a one-way street. It is clear that the others have to help a country in crisis; it is necessary. But accepting common rules is also a form of solidarity. In the past decade, Greece hasn’t done it–nor have the majority of the others, including Germany and Italy.  In Europe, the exercise of solidarity hasn’t worked.

Are you talking about the violations of the pact of stability and the famous parameters of the Maastricht Treaty?
Exactly. The European pact isn’t just for workdays; it’s for the whole year, even in the ugly months. The Schröder and Chirac governments were the first to break it, in 2002, violating those parameters. They opened the road. And today, in some way, we’re paying the consequences. This is why we need to return to a strong, clear agreement with transparent rules. It’s the basis of a true system of solidarity.

It’s interesting that you link solidarity to rules. They aren’t just technical evaluations of eurobureaucrats, but are born of an idea of a common task, even if it’s translated into numbers, percentages, and deficit parameters not to be exceeded…
You see, the basis of the whole European system is trust–in institutions, in rules. Today, there is no longer this trust. For example, in Germany, the climate is strongly against Europe, against development of integration and also against the euro–the majority of Germans would like to return to the marc. Clearly, there’s a mistaken foundational evaluation, and a lack of seriousness. But it’s also the consequence of a lack of trust in the behavior of the other countries.

But wasn’t it reductive to base everything on numbers and rules? As things went forward, there was a slow loss of the awareness that those rules came from a common ideal. The only things left are the obligations, and you can get around obligations, so now the people have lost faith.
Wasn’t it an error?
The rules aren’t abstract. They have to be bound to institutions that see to their development, improvement, and application. To a system of government. To effective governability. We’re still behind on this.

Doesn’t a system of government need ideals, points of reference, at its foundation? Isn’t the crisis that of a Europe without a soul?
The soul of Europe doesn’t mean accepting everything the Greeks do because they are the heirs of Socrates. The soul is to accept common values, principles, and rules. I was very critical of Schröder and Chirac 10 years ago, but today it’s the same thing: the countries that live above their means destroy the very soul of Europe, because their egotistical behavior undermines the trust of everyone. The soul functions only if the blood runs throughout the body, not just in one direction.

However, could it be that we are before a more serious forgetfulness? To be explicit, doesn’t the loss of an overall project seem to be linked to the rejection of Europe’s Christian roots? The idea of solidarity was born there; it has a profound relationship with Christianity, and this bond was cut...
Yes and no. It’s true; maybe we’ve forgotten the Christian roots–the ideas of love, solidarity, and justice come from there. But we have also forgotten a certain sense of enlightened self-interest, attention to one’s interests in the positive sense–the awareness that when we live together, in a community, we have to accept all the consequences. Here there’s the idea of living in a community, but there are also strong limits, because money isn’t everything. In this sense, I believe that Europe has forgotten how important it is to rally around the idea of a community of values. It has become a rhetorical expression. The consequence is the risk of returning to nationalistic sentiments, the idea that your country can save itself from the strong winds of globalization. But this is an illusion. We’ve been seeing it these days: we have increasingly greater need of European solutions, not just for saving Greece, but also for all of us.

How can trust in the Union be recovered?
With serious action in favor of integration, and with transparency. The point is that we can’t live without European mechanisms, but people don’t understand why. These people who meet in Brussels govern us, but the people don’t have the sense that it’s an effective government. They perceive it as something far away.

And yet, there are those who see in this crisis a signal of the overall decline of Europe, and say that the center of gravity of the global economy is shifting elsewhere...
People are afraid of decline because they see the others–China, India, Brazil–growing. We have the sensation that the inevitable consequence is a sum zero: if the Chinese gain, we necessarily lose. But this conclusion is simplistic. There are aspects in which we lose; it’s inevitable–in certain spheres of industrial production, for example. But on other points, no. We can win if we invest in what helps develop the society of services and communications, or new technologies that produce added value. Think of healthcare, education, and urban infrastructures: hot problems throughout the world. But European potential is enormous, above all, in another sphere...

Which sphere?
We can help define the principles that help us live more humanly. Countries like China and India are not just markets and economies in rapid growth; they have grave social problems that question the very idea of development. What are the conditions for truly human development? Just a whirlwind increase in GDP? Here, Europe has a lot to say on this, and to share with the rest of the world.

And much more to say, the more Europe draws upon its cultural roots. If not...
True. Cultural and religious roots, but also political. In all these aspects, Europe is more than a continent in decline, and it needs to realize it holds a treasure that it is not always aware of having.

The attitude of the United States toward Europe is changing. The U.S. looks to the east and the south, and increasingly more often bonds with emerging economies. How does this fact influence Europe’s self-perception?
For many reasons, it is normal. Obama is the first “Pacific President”–he was born and raised in Hawaii, and for him the Pacific is mentally closer than Europe. But he’s already been here several times since becoming President. You see, the United States is a global power, and always has been, in virtue of a global cultural attraction: the American Dream. It is still something that draws people from all over the world. There is no European Dream. We need to do two things at once: reactivate this sense of internal solidarity in the Union and truly open ourselves to globalization. The destiny of Europe is to become part of the world, not just a protected fortress that fears breaches.

What short-term scenarios do you see? What will happen to the euro?
On the basis of the real economy, we will have to achieve near parity between the euro and the dollar. But the drop in the euro isn’t as grave as it seems. We lived a long time with the euro at less than a dollar, 10 years ago. Then it rose to over 1.5 and it certainly wasn’t a positive situation for European exports. Today, we’re returning to a balance. It is not the end of the euro; these are normal waves. What is not normal is the debt of EU countries. We all have to work against this, and strengthen the European government.

And the PIGS?
It depends on what they do in the political system. Two or three years ago, Latvia was on the point of collapse, but with a strong austerity program they have recovered. Ireland is on the same road. It is possible for Portugal and Spain as well, not to mention Italy.