Why the European Union Is Less than Ideal

A moment that encapsulated the hubris of the European elite came during the Netherlands’ 2005 referendum on the European constitution. Journalists discovered that the yes campaign was planning to show where a rejection of ever closer union would lead. It did not plan to offer images of politicians having to cope with an unwelcome setback but of the railway track to Auschwitz and of the Srebrenica massacre.

Public outrage forced the organizers to pull the campaign broadcast. But the incident offers a telling illustration of the dogmatic state of mind shared by many proponents of federalism. The roots of the E.U. lie in economic and political alliances forged in the rubble of World War II. The E.U.’s underlying logic was to save Europeans from the horrors of the past by turning old nation states into a cuddly, new Euronation.

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A majority of respectable politicians, bureaucrats and journalists in continental Europe supported the Euronation’s single currency, the euro, just as their counterparts in Britain and America supported a laissez-faire state that allowed bankers to do as they pleased. Both policies have led to disaster. Yet when conventional wisdom fails, when its predictions turn out to be ridiculous and its hopes become cruel illusions, respectable people do not, as a rule, hold up their hands and admit their mistakes. They would lose too much face, and where would their privileged positions in society be then?

Even after all Europe has been through, its leaders still shy away from stating plainly that the idea of putting Italy, Ireland, Spain, Portugal and Greece at a 30% competitive disadvantage by locking them into the same currency as Germany was monumental folly. The keepers of European orthodoxy have therefore convinced themselves that corrupt Latins and Greeks caused the crisis by failing to keep to the rules. The utopian schemes of a deluded E.U. had no part to play. Turn southern Europeans into northern Europeans by means of a rigorous austerity program and — voilà! — crisis solved.

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E.U. leaders in denial make a cheerful bunch. President Nicolas Sarkozy is assuring French voters that the worst is over. On March 6, the E.U.’s Economic and Monetary Affairs Commissioner Olli Rehn said that he was confident the euro zone would recover from recession and the restructuring of Greek debt would succeed. The European Central Bank is boasting that it saved the world from a second credit crunch by lending $1.3 trillion to southern Europe’s banks. Meanwhile, Finnish Prime Minister Jyrki Katainen is facing the future with such confidence, he told anyone prepared to listen that a meeting of E.U. leaders on March 1 was “not a crisis meeting.”

The miserable inhabitants of southern Europe might manage a grim smile. Unemployment is 20% in Greece and 23% in Spain. Almost half of young people are out of work in both countries. Portugal and Italy are in recession, and few can see a way out. There is only so much punishment these people will take before they revolt.

More punishment is all the E.U. is offering them. It thinks it can impose austerity during a recession on countries that do not have the option of improving their competitiveness by devaluing their currencies — without pushing them deeper into the mire. Instead of healing them, austerity is crushing demand and sending debt-ridden countries closer to bankruptcy. Greece is already there — as everyone except the E.U. admits. Portugal looks ready to follow.

Redemption will only come from an honest admission of failure. The E.U. is nothing like the monstrous utopias of Hitler and Stalin, so I will spare you the Nazi comparisons. But its utopianism has created a “gentle monster” — to use the German poet Hans Magnus Enzensberger’s nice phrase. It has insisted that there is no alternative to ever greater union and did not understand that “the notion of a lack of alternatives offends human reason, because it amounts to a ban on thought.”

Honesty will require northern Europeans to show that their talk of “European solidarity” was not just windy nonsense. They need to spend vast sums on cleaning up the mess. Either they throw money at the countries of southern Europe to help them stay in the euro and restructure their economies, or they throw money at the countries of southern Europe to help them leave without suffering a cataclysmic breakdown.

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The alternative — for there is always an alternative — is to allow southern Europe to fall into ruin and despair, a precursor of the conflict the E.U. was founded to prevent. And that is an alternative no civilized European should contemplate.

Cohen is an author and recently published You Can’t Read This Book: Censorship in an Age of Freedom

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