Europe: Unity or Disunity?

The problem of economic stagnation has been especially prevalent in Western Europe, where unemployment is at its highest level since the 1930s and economic growth in recent years has averaged less than 1 percent annually. Conditions have been exacerbated in recent years by the need for individual governments to set their financial houses in order so as to comply with the requirements for unification as called for by the Maastricht Treaty of 1991 (see Chapter 9). For an individual nation to take part in the process, government deficits must not greatly exceed 3 percent of gross domestic product, nor must the national debt greatly exceed 60 percent of total output. Inflation rates must also be cut to minimal levels. The problem is that many countries are encountering difficulties in adopting the severe economic measures that are needed to qualify for the transition to economic unity. France, concerned at the potential impact on its own fragile economy, has threatened not to carry out the necessary reforms. In Italy, the refusal of the Communist Party to agree to belt-tightening measures almost led to the fall of the coalition government. Even in Germany, long the healthiest of all major Western European states, reductions in social benefits sharpened tensions between the eastern and western zones and undermined public support for the government of Gerhard Schröder. But perhaps the most ominous consequence of the new economic austerity has been a rise in antiforeign senti- ment. In Germany, attacks against foreign residents— mainly Turks, many of whom have lived in the country for years—have increased substantially. Conservative forces have turned to the idea of preserving “German culture” as a rallying cry to win the support of Germans concerned over the rapid process of change. In France, hostility to immigrants from North Africa has led to rising support for Jean-Marie Le Pen’s National Front, which advocates strict limits on immigration and the ejection of many foreigners currently living in the country. It seems clear that the ethnic animosities that so often fueled conflict in Europe before World War II have not entirely abated. By no means do all Europeans fear the costs of economic unity. Official sources argue that it will increase the region’s ability to compete with economic powerhouses such as the United States and Japan. But fear of change and a strong legacy of nationalist sentiment have promoted public fears that economic unification could have disastrous consequences. This is especially true in Great Britain and also in Germany, where many see little benefit and much risk from joining a larger Europe. At the same time, some of the smaller states within the European Union (EU) are afraid that their concerns will be ignored by the larger powers. Such concerns have also emerged in Eastern Europe, where several governments are seeking membership in the EU to improve their own economic conditions.