Éloi Laurent is a senior research fellow at OFCE/Sciences Po and a visiting scholar and professor at the Center for European Studies and Environmental Science and Public Policy Concentration at Harvard University.
There is very little to be cheerful about five years into our “great recession”: financial markets are more than ever a fertile ground for global crisis; government have as modest power to control them and less resources to clean up their mess; Americans and Europeans in their vast majority find themselves marred in a “great regression” of their standards of living and expectations.
But one single piece of good news should not be overlooked: European integration, on the brink of dissolution at several key moments in the last five years, has somehow managed to survive its most serious crisis since its consolidation in 1992, when the European Union was created.
Of course, nothing has been easy or smooth and European crisis-management was at each turn at best accidental: from the early complacency (the great recession was merely an “American financial crisis”) to the constant irresolution (an “extraordinary summit” following another to no tangible result) and unscripted turnaround (the European Central Bank singlehandedly re-writing the European economic constitution to eventually assume its role as the region’s lender in last resort in August 2012).
And nothing is certain still: The challenges facing the European Union five years down the road are nothing short of herculean. Most flaws in the design of the continent’s monetary union – the epicenter of the European crisis - have not been corrected, the divergence between core economies such as Germany and Spain have only slightly eased, the trumpeted “recovery” can hardly hide the persistent mass unemployment and growing social precariousness. Even more concerning, the self-defeating commitment to austerity is still very much the common currency of European leaders. But the most staggering challenge lies in the expanding European disillusion: surveys reveal that a majority of European citizens have turned their back on Europe because they feel Europe has let them down when they most needed it. Who can blame them?
In other words, the survivor European Union has to invent at once a new prosperity and a new purpose to endure, it must find both an exit and a direction out of the crisis.
Political leadership could mean turning this elusive and ever-threatening “crisis” into a chosen and meaningful transition. And the most sustainable European transition out of the crisis is toward the Green economy, building on the continent's ecological comparative advantage. The European Union has indeed become in the last two decades the global ecological leader, the very position assumed by the United States in the 1970s. But deeds have been falling behind words in the last five years.
To have a sense of the gap between rhetoric and political will of European policy-makers on the green economy, consider the sorry state of the European carbon market, by far the world’s best climate change mitigation instrument, brought down by the economic recession and neglected ever since.
To have a sense of the potential of the green transition for European revitalization, consider what massive investment in thermal retrofit of housing could do to win back European citizens, through non-outsourceable job creation, fuel poverty alleviation and energy efficiency promotion. Or how much Europe could save in financial and geopolitical terms by getting out for good of the trap of fossil fuels dependency. Or how the creation of a European community for energy and sustainable development could catalyse cooperation and economic dynamism.
European integration was always much deeper than economic inter-dependence, which was the genius ruse of the founding fathers to overcome political divisions and bind bellicose sovereign powers to peace through trade. But economic mismanagement has threatened to undo decades of patient sovereignty pooling that makes the EU an unprecedented political and cultural experiment and a laboratory for global governance. By truly committing to the green economy, Europe would essentially be reaffirming its existential attachment to lasting peace. The European Union has survived the crisis, brilliant, now it should get back to securing the future of Europeans.