One of EU leaders' most frequent reactions when the bloc goes through a traumatic experience is to come up with a series of proposals to deepen political and economic integration. If the European Union is in trouble, so the argument goes, the only way to protect it and prevent new crises is by making countries transfer more national prerogatives to supranational institutions. Now that the Greek crisis has given EU leaders a temporary respite, the French government is proposing a series of reforms that, according to Paris, will avoid similar conflicts in the future. But France's proposals would do little to alleviate the systemic crisis of the European Union.
In an opinion piece for Le Journal Du Dimanche published July 19, French President Francois Hollande called for the creation of a "eurozone government," with its own budget and parliament. The French leader did not provide the details of or a desired timetable for the implementation of the project but suggested that, "it is not the excess of Europe that is threatening us, but the lack of it."
The Socialist leader has made similar statements in the past. But the timing of his most recent proposals is notable because the Greek negotiations generated the most serious political crisis in Europe since the creation of the eurozone more than a decade ago. The crisis was so severe that German officials said they were open to Athens leaving the currency union — a rare admission that the process of Continental integration could be reversed, at least for some countries. This position is particularly important because it came from Germany, the largest political and economic power in the bloc and a country that has traditionally defended EU integration for historical and geopolitical reasons.
Hollande linked his proposal for the creation of a eurozone government to similar ideas defended by another Frenchman, Jacques Delors, a notable former European Commission president and one of the main forces behind the creation of the euro. But besides the superficial calls for European unity and solidarity, Hollande's appeal to Delors' ideas reveals a deeper geopolitical principle: the need to keep France and Germany together in the closest possible political and economic alliance.
The euro was not created out of solidarity and friendship, but because of the need to link France and Germany in such a way that Paris and Berlin would be forced to cooperate and lead Europe together. When Germany reunified in 1990, the euro was seen as a way to link Germany's economic might to France's political and military leadership. But the European crisis weakened the French economy and reduced its influence in Europe, while Germany consolidated its position as the most powerful and influential country on the Continent.
During the early stages of the crisis, Germany was a reluctant hegemon, a country stronger than its neighbors but one that needed their acquiescence to make decisions. This has allowed former French President Nicolas Sarkozy and then Hollande to somewhat influence decision-making in Berlin while maintaining the facade of dual leadership on the Continent. But the Greek negotiations severely damaged this balance; the main decisions were made in Berlin, Frankfurt and Athens while Paris watched from the distance. Hollande's intervention eventually facilitated an agreement between Athens and its creditors, but the French government was probably shocked by Berlin's tenacity during the negotiations.
Germany and France agree that the Greek crisis has created a dangerous precedent for Europe, but for different reasons. The Germans fear that a rebel government in a southern nation could threaten the European Union's rules on debt and deficit. The French government is alarmed by the fact that Germany built a coalition of Northern European countries willing to asphyxiate a government in the periphery and force it to make painful capitulations. For both, deeper Continental integration would prevent a similar crisis from happening again. But since their diagnoses of the crisis differ, so do their positions on what to do next.
The idea of a parliament and a special budget for the eurozone is notable because Mediterranean nations have fragile economies and large populations. Should a special parliament be created for the currency union, France, Italy and Spain would outvote Germany, the Netherlands and Finland. In this scenario, the wealthier economies in the north would contribute to a common budget that would be controlled by a parliament dominated by the economies in the south. With a eurozone parliament in place, Mediterranean Europe would probably push for a weaker euro, a relaxation of the process of economic reform and the use of more EU funds for investment and subsidies.
Germany would naturally oppose this. In a recent interview with Der Spiegel, German Finance Minister Wolfgang Schaeuble praised Hollande's proposal for more economic integration and said the creation of a eurozone parliament should be complemented with the creation of a finance minister for the eurozone and the strengthening of common fiscal rules. Both measures suggest that Berlin remains profoundly interested in securing supranational control for deficit and debt limits in the currency union — something that could make France uncomfortable.
Finally, recent political developments show that many Europeans want less Continental integration, not more. While Germany and France may disagree on how to deepen the process of EU convergence, some political forces directly refute the idea that there is a "lack of Europe." Nationalist parties, such as France's National Front and the Danish People's Party, and moderate administrations such as the British and Dutch governments, believe there is actually too much Europe and that deregulation and even the reversal of some aspects of the process of Continental integration are necessary to generate growth and employment in Europe.
Hollande's proposals will not be implemented any time soon, if at all. The president is facing general elections in less than two years, and his Socialist government will probably be replaced by either a moderately Euroskeptic center-right or a nationalist-right government. In Germany, where general elections are also scheduled for 2017, conservative forces will continue to resist any measures that force Berlin to share taxpayers' money with the country's southern neighbors. Despite Hollande's well-intentioned ideas, it is more likely that the process of European integration will halt or even reverse rather than accelerate.
