E3G

Europe in the World: Summer Briefing

By Chris Littlecott

Europe in the World

The defining feature of the future is global interdependence. We know to our cost the price of a retreat into nationalism. In this world the core insight learnt from the experience of building the European Union becomes globally relevant: that sovereignty can be shared without loss of identity.

Europe is the world’s largest economy, trading power and supplier of capital. It is the world’s biggest market. It invests more in the public goods that underpin prosperity than any other major economic power. It leads the world in ensuring that economic growth leads to increased well-being, equity and social mobility. It has built a solid foundation of political support for these strengths. Its financial stability, enduring social compact and strong environmental governance equip it to cope well with a world of structural economic and social change, demographic transition, resource constraints, climate instability and multiple interlinked vulnerabilities. These assets are firmly embedded in deeply held and widely shared values.

However, Europe’s reform debates have failed to build on these strengths, and have offered Europeans a prospect of the future based on a fear of change, rather than confidence in its management. European’s misplaced fears about their ability to maintain prosperity is resulting in a politically debilitating lack of confidence.

This lack of confidence has its roots in the reality of unemployment and the tensions resulting from accelerating economic change. But these roots are watered by the self-defeating rhetoric of European political debates: by politicians who present economic reform as if Europe needs to become a pale imitation of the USA, and by their populist opponents who promise to return to some mythical and unobtainable protectionist golden age.