Despite the economic crisis and the struggle to save the euro, the European dream is not dead yet: what Europe needs is an "economic vision and game plan that would create a seamless, distributive energy grid" to build a third industrial revolution, said Jeremy Rifkin, author of 'The European Dream', in an interview with EURACTIV.
The EU is in the best position in the world to make the transition from a second to a third industrial revolution, said Rifkin, refuting arguments that Europe is doomed to fail.
"For all its faults, Europe is still the laboratory of the world," argued the US economist, who heads the Foundation on Economic Trends. He explained that the United States is moving further and further back in time and China is a top-down centralised regime that is going to implode.
However, EU leaders should stop looking at the "side-show", Rifkin said, claiming that the financial crisis is merely an after-shock of the economic earthquake caused by oil prices hitting $147 a barrel in 2008.
"That's what I call peak globalisation and it is an end game for the second industrial revolution," he claimed, adding that for over a decade, industrialised countries spent their savings to move ahead with globalisation.
Rifkin predicted that when the recovery picks up, oil prices will increase and eventually "short circuit", cutting off the economic engine again and throwing the world into panic. "It is going to be a boomerang effect," he warned.
Four-pillar third industrial revolution
According to the US economist, who became well-known across the Atlantic after publishing his best-seller The European Dream, the exit strategy to push the EU into the third industrial revolution rests on a four-pillar infrastructure revolution that will give the EU the same economic multiplier effect that drove previous industrial revolutions: the railroad in the 19th century and more recently the interstate highway in the US.
Apart from increasing the use of renewable energy to move towards zero-carbon emissions and a post-carbon economy by 2050, Rifkin called for the transformation of every home, office and factory into a partial power plant.
"A bit of sun on the roof, a little bit of wind on the walls and heat from the ground, and buildings become partial power plants," he said, stressing that buildings are not only the major cause of climate change, but also the solution.
Hydrogen is the third pillar of Rifkin's vision. The EU must commit to hydrogen as a means of storing intermittent energy sources, he said. "We have to set up hydrogen infrastructure across all buildings, infrastructure and power lines in Europe."
The fourth strand of his strategy combines the Internet and communication technology revolution and the distributive renewable energy revolution.
"Millions and millions of buildings producing their own energy, storing some of the surplus hydrogen – like you store digital and media – then what they don't use, they can share across 27 states with 500 million people on an intergrid that acts exactly like the Internet," he said, insisting that the technology exists.
Europe's asset: Integrated market and Mediterranean partnership
According to Rifkin, the EU, as the first continental governing body and a leading global economy, has all the assets to win the third industrial revolution race, including the fact that the bloc can count on its associated partnerships with the Mediterranean regions of North Africa and the Middle East.
"That makes up one billion people, potentially the largest internal market in the world: way beyond anything China can imagine," he said.
Such a plan would leave old geopolitics behind and pave the way for what Rifkin calls "biosphere politics".
"This is the next project for Europe and if Europe fails, then the European dream will fail. If it succeeds, the European dream becomes a dream for an empathic civilisation, a global dream of living together in a shared biosphere," he said.
Pay for revolution with 'economic investment model'
Amid budget cuts and austerity measures, countries are struggling to allocate resources to transform their economies, but taking the public expenditure approach is not the right way to go, Rifkin argued.
"You have to look at this as an economic development model. The reason it is important is that it changes the whole way one thinks about where the money is," he noted.
As an example, Rifkin described his work in the city of Rome. The Italian capital spends about €26 billion on economic investment – approximately one-fifth of its GDP. Rifkin reckons that by spending only 1.4% of that amount on implementing the four pillar strategy, Rome could cut 40% of CO2 emissions in the next 20-30 years.
"This is money they are going to spend anyway, even in bad times," he argued.
Other EU countries are also developing a silent revolution – these include Germany, Spain and the Scandinavian countries.
The economic development plan is sure to boost construction, create millions of jobs and transform the European economy towards a sustainable growth model, said Rifkin.
From elite vision to people's vision
But this vision, so far confined to Brussels, has to move out of elite circles to become a major public discussion across Europe, Rifkin underlined.
"It requires political leaders who can 'talk the talk' with the public and still 'walk the walk'," he said, saying that in the midst of the crisis, the EU should step in, tell the world where the recovery is and develop a new narrative.
According to the economist, the next step after the collapse of international negotiations to deliver a global climate deal last December in Copenhagen is a change in the way we think.
"We have to see the opportunity for a new economic vision [and] game plan, a new economic revolution that will get us to a post-carbon society," he said, stressing that with such a change, a legally-binding agreement becomes "completely irrelevant".
Jeremy Rifkin was speaking to EURACTIV Managing Editor Daniela Vincenti-Mitchener.