The primary obstacle to solving Europe's fiscal crisis is not money. There is enoughmoney, especially in Germany, to stabilize European financial markets, at least untilthe next convulsion. What is plainly missing among the European states is the sense ofmutual sacrifice and common political destiny that we call citizenship. The crisis hasexposed the thinness of European citizenship, especially in comparison with that in theUnited States.
Not since the Maastricht Treaty twenty years ago has the location and scope of Europeansovereignty been so urgently contested. The bitter, seemingly endless negotiations overwhich taxpayers, banks, and investors will pay for what shares of the huge impendingbailouts and haircuts are fueling resurgent nationalisms. Powerful Germany, the stolidDutch, tiny Finland, and other flourishing states ask the question that defines citizenship:Why should our provident, already highly-taxed workers pay for the undisciplinedspending of Greek and Italian politicians, their bloated public payrolls, and their corruptinstitutions? Why should we allow irresponsible strangers who can barely governthemselves to punish our hard-won prosperity, restraint, and stability?
To the visionary Europeanists who have dominated the EU bureaucracy since the 1950s,the answer to these questions is clear: far from being strangers, the struggling people onthe continent's periphery are comrades and fellow citizens, united in the commonwealthof Europe. In this commonwealth, the wealthier states must bear most of the financialsacrifices necessary to bolster the political and fiscal fragility of the weaker ones.
Six decades and several fiscal crises later, however, this admirable communal vision hasbeen revealed as an unattainable, dangerous fantasy. The cosmopolitan European idealhas (to paraphrase Irving Kristol) been mugged by a stark reality: each European state isan independent polity with a unique history and language, driven by (enlightened) self-interest, and exhibiting a deep citizenship that requires substantial sacrifices to support itsgenerous (if endangered) welfare state.
How did this reversion to reality happen? The EU is one of the great contrivances inhuman history, built with visionary leadership and generous mutual regard. Its free tradezone has created vast economic benefits and its borders have made intra-European travelmuch easier (perhaps too easy, as we shall see). Most important, it has made internalwarfare unthinkable. Germany, in particular, has restrained its economic power andhistorical ambitions in the interests of promoting this vision of a commonwealth.
It is the common currency that has stretched the idea of European citizenship beyond itsachievable limits. The euro's doomed struggle to harmonize the political economies ofthe EU's member states has only served to underscore their irreconcilable cultural andeconomic differences. As the weaker states desperately seek national remedies for thecrisis, they are drawn powerfully to zero-sum, beggar-thy-neighbor, free-riding policies-- especially currency devaluation -- that must ultimately fracture the euro zone. The
weaker states have reneged on the single-currency bargain by failing to limit deficits,maintain healthy financial institutions, and discipline their public sectors and laborunions. The stronger states fear that their own voters will punish them for having beensuckered and frittering away their money on a cosmopolitan scheme that only Brusselscould love. When strong states' benevolence reaches its limits, and the weaker onesretreat to their own currencies, the already tenuous conception of European citizenshipwill further retreat.
The thinness of European citizenship is also revealed by the EU's largely unsuccessfulefforts to integrate immigrant, linguistic, and other minorities, efforts that have managedto reinforce the very nationalisms that the EU admirably sought to suppress. Forexample, each of the leading EU states now imposes a demanding cultural test as aprecondition for citizenship -- and in some cases, even for initial entry. These tests belieany notion of a common European culture, much less one that could justify the enormousinter-state transfers, subsidies, and sacrifices that the current crisis will increasinglyrequire from the stronger states.
Then, there is the problem of borders. To be a citizen of a polity is, among other things,to be able to rely on borders that the polity will defend. Yet in Europe, the Schengenperimeter has proved quite porous. Frontier states like Italy and Greece have broken theirSchengen promises both by failing to intercept illegal migrants from North Africa and byencouraging them to move northward into other, more prosperous EU states. This failurehas helped to make right-wing nativist parties an electoral force in almost every EU state.
Compare this with the situation in the United States where the number of newcomers whomust be integrated is far greater. Congress continues to permit high legal immigrationlevels and makes citizenship relatively easy to obtain (including even the U.S.-bornchildren of illegal immigrants), partly because the cultural test is so undemanding. Legalimmigrants and minorities are widely respected and protected in the U.S., which has noglimmer of a nativist party. Even conservative Republicans, eager to recruit high-skillworkers and attract the growing number of Hispanic voters in swing states, tend to acceptthe current high levels of legal immigration.
Even America's own economic crisis has not significantly threatened the moralunderpinnings of its common citizenship. Even as the politicians bitterly disagreeabout how Americans should share the fiscal and programmatic burdens of controllingthe deficit, the sense of national unity, reciprocal obligation, and common destiny thatunderlies this debate remains deep and powerful.
Internally, each European state has achieved this unity to a remarkable degree, despitedevolutionary pressures in some. Externally they have been able to exploit the mutualgains to trade and cooperation through some effective collective institutions. But thequality of citizenship necessary for a sustainable fiscal union does not yet exist andprobably never will. It was a step too far.