The European Union has since its creation in 1992 never been as much criticised as nowadays. The idea of a communitarian Europe has evolved into an idealistic and unreal concept far from the reality of disputing and divided European States. The increasing hostility towards the EU has various reasons leading to the outcome that Europeans out of desperation and anger are not willing anymore to support the European formation as a whole. Citizens have lost their trust in the institutions as they feel misunderstood and insufficiently represented in their interests. As a consequence, communitarianism in Europe is largely endangered by nationalist and extremist tendencies which have witnessed a tremendous rise over the last few years, largely profiting from the delicate political and financial situation many European countries find themselves in.
We are in this development going to analyse the reasons for this rise of anti-communitarianism and going to seek for solutions regarding the necessary response the European Union has to give to regain confidence among its citizens.
The European Debt Crisis endangering the European Construction as a whole
The Financial Crisis which started with the bankruptcy of Lehman Brothers in the United States in 2007 engendered nearly a complete breakdown of the financial markets and sovereign States had to deal with the consequences of the excesses caused by the financial sector. This is mostly due to instability on the markets, leading to a significant increase of interest rates which made debts of several Member States explode and caused recessions in a lot of European countries over the last few years. The whole European formation has suffered significantly due to the difficult economic situation Europe had to face over the last years and still does. People have lost their trust in the European Union, conceiving the latter as of purely economic interest for an elite represented by the powers incarnated by the so-called “ Troika”, the European Commission, the European Central Bank and the International Monetary Fund, imposing doubtful austerity measures to different countries in difficulty who need to consolidate their public finances.
A flagrant lack of solidarity between the Member States throughout the management of the Crisis
Throughout the management of the European Debt Crisis, the lack of confidence and solidarity among countries could not have been more flagrant. However, its strictly impossible to move forward as an entity being part of a whole, as the EU, but at the same time only wanting to see it’s own interests represented in the most favorable way. To be able to have an effective and straightforward monetary policy, it is important to take communitarian decisions which seek for the best compromise among all Member States. Although, Europe fails majestically when it comes to taking these decisions. For example, the monetary policy imposed by the European Central Bank does not aim for consensus among all Member States but advantages clearly Germany to the disadvantage of many other European countries. Spain, Greece, Cyprus or Italy have suffered from severe recessions for several years and require a devaluation of the Euro to be able to become competitive again, to increase their exports and, as a consequence, have the possibility to let their economies grow. On the contrary, Germany is completely opposed to a devaluation of the Euro because it is profiting from booming exports with a strong currency inside the European Union.
The Euro is conceived to be a common currency for all countries within the Euro zone, however these countries grow very differently from one another and subsequently it is difficult to fix an accurate value of the currency for a vast number of heterogeneous economies. Further, the European Central Bank is not able to execute a strictly defined monetary policy within the Euro zone. Indeed, while instituting the European Union in Maastricht in 1992, Member States did not want European institutions to take over their sovereign monetary policy by putting in place a strictly defined common policy which would have however been of vital importance for a strong and straightforward monetary Union. This turned out to be a big mistake and shows that lack of communitarianism in Europe is unfortunately deeply rooted in the formation process of the EU.
Moreover, the European Stability Mechanism (ESM), an institution put in place to guarantee and provide financial assistance for EU Member States in difficulty, demonstrated vividly to what extent Europe does not act as a democratic unity and to what extent mistakes have been committed in the management of the crisis. The money from the ESM flowed directly into the pockets of investors and banks, countries which asked for financial help such as Spain, Portugal, Greece or Cyprus were not helped at all with subventions which could have been used for productive investments in order to try to reactivate certain parts of their economies. Austerity policies have been implemented and were certainly necessary to attempt to resolve the crisis. However, merely putting in place austerity measures corresponds to the biggest mistake which could be done to try to handle an economic crisis.
In fact, they should be implemented with subventions for productive investments and coupled with administrative reforms which try to reactivate the economic growth and fight corruption within the State by making administrative procedures more efficient and cost saving. The price countries as Greece or Cyprus have to pay, imposing them only austerity measures which drive them into poverty and precariousness, is too high and discourages citizens in their beliefs regarding the effectiveness and strength of the European Union.
European Citizens losing their trust and confidence in the European Union
It is important to note that citizens, having to bear the entire consequences of a financial disaster they are not responsible for, turn their back to communitarian ideas and stop believing in a strong European Union. In the end, this constitutes the biggest danger for Europe and it seems as if our representatives have largely underestimated the necessity to seek for solutions which provide a hopeful outlook for the future and do not only drive Europeans into precariousness.
Apart from people living in poverty, extremist tendencies have experienced a tremendous rise and are severely threatening communitarianism in Europe. Without extremist powers, many countries are not able to legislate anymore because these political parties are well represented in their relative national Parliament. To illustrate, in the Greek Parliament, the coalition of the Radical Left has 71 seats, the Communist party has 12 seats and the Golden Dawn, being an extreme right party has 18 seats. More than a third of the seats in the Greek Parliament (101 out of 300) are currently occupied by extremist political parties. The example of Greece has been chosen in this case, but a lot of different European countries as for example Sweden, Austria or Hungary show similar evolutions concerning the rise of extremisms in Parliament.
The need for transparency and democracy as a basis for a communitarian Europe
The financial crisis has evolved into a democratic crisis in Europe. Policies are no longer defined in national governments but are decided either by financial institutions in New York, London and Brussels or by the “Troika’’ without the consent of the concerned population. To illustrate, former Greek president George Papandreou wanted to let the Greeks vote on referendum if they accepted the conditions under which the “Troika’’ would allow a 50% haircut of the government debt. However, the leading European countries were not at all pleased about the idea to have to discuss about the conditions of the cut by letting the Greek people decide whether they would accept austerity mesures or not. Papandreou was set under huge pressure by the European Central Bank, former French president Nicolas Sarkozy and Germany’s chancellor Angela Merkel, thus he finally decided to cancel the referendum.
If this example might seem controversial because it can be argued that Greece needed to have the entire sovereign choice whether or not to agree on these austerity mesures due to the dramatic situation they found themselves in, however it shows well the democratic deficit in Europe. It has become normal to take decisions without the consent of the concerned population even though they are the ones who have to bear the consequences of these decisions.
Unelected technocratic Prime ministers who governed a certain number of European countries over the last years give another example of the lack of democracy. In Italy, Mario Monti, a former Goldman Sachs banker known for having a positive influence on the financial markets, was appointed Prime minister by the Italian President Giorgio Napolitano in 2011 and set up a cabinet of unelected technocratic professionnels in order to try to resolve the difficult economic situation the country found itself in. At the same time in Greece, Lucas Papademos, the former governor of the Bank of Greece, was appointed Prime Minister without democratic elections for the same purpose.
Further, the negligence to refer more frequently to democratic principles in decision making processes has become one of the major arguments put forward by extremist political parties to criticise the “elites” or powers in place. The current hostility against the European Union is largely due to a lack of democracy as well as a lack of transparency regarding decisions which are taken in Brussels, Frankfurt and Strasbourg. There is an urgent need for transparency of all organs which would make it possible for citizens to understand and be informed on issues which are decided inside the institutions. To illustrate, the European Commission in Brussels, being the most powerful organ of the European Union, is not at all operating under democratic principles which give Europeans power to control the institution. A Commissioner is elected by every government of the 28 Member States, however, neither governments nor citizens are really involved in the decision making process of the Commission. In this context, it is praiseworthy that the upcoming European Elections in May 2014 are envisaged for the first time with two prime candidates who run for the vacant seat as President of the Commission to engage citizens more extensively with the election of representatives and their political beliefs within such institutions.
Additionally, it is absolutely necessary apart from seeking for more transparency to imply European citizens with basic democratic principles such as referendums on crucial questions concerning the EU. The refusal of the “ Treaty establishing a Constitution for Europe” referendum held in 2005 was largely motivated due to the repugnance a certain number of citizens felt against the decision making processes of European institutions. This repugnance can only be avoided if all organs of the EU work in greater transparency.
Besides, transnational media is necessary which provides citizens of all Member States easily with news regarding important decisions that are taken either in Brussels, Strasbourg or Frankfurt and which are not only focusing on single aspects taken up occasionally by national medias.
The imperative need for politics to regain dominance over finance
More generally, it is possible to state that this lack of democracy in Europe is mainly due to the lack of power and influence politics have over the financial sector. To regain confidence in the eyes of citizens, politics need to control the financial sector and not vice-versa. There is an eminent need for democratic institutions which control sharply the financial markets and their transactions mostly in the domain of financial deregulation. A first step has been done by the European Union in prohibiting speculation on debts of European sovereign States. The creation of the European Banking Union could be a second and very decisive step in order to fight abuses of big financial institutions and mostly for their need to be saved by tax-payer money. As a matter of fact, the Banking Union should give a supervising power to the European Central Bank not to let a network of big banks in Europe degrade themselves into a precarious situation where public money is needed in order to avoid bankruptcy. The Banking Union creates a system where first of all the creditors and shareholders take the risk of a breakdown of the institution. Apart from this, a sovereign fund subsided by all these banks of more less 60 billion euros is put in place to help banks in difficulty. However, this risk pooling of banks is only going to operate from 2025 on. Besides, Germany opposed itself to use money from the ESM to fund banks in difficulty. Nevertheless, it is important that the Banking Union would set a new departure of a communitarian Europe where savings of citizens are secured against insolvency of big financial institutions.
For Europe, it is crucial to reinstall a climate of confidence based on basic democratic principles where capital decisions are taken in the interest of all European citizens. A breakup between politics or more generally democracy and the financial markets is essential if Europe wants to regain confidence among its citizens. If we fail in reinstalling such a climate of confidence, the EU will shift beneath our feet and the ongoing peace process in Europe since the second World War through European cooperation will definitely come to an end.