What is Crisis Boost? The buzzword “polycrisis” has been around for a number of years. In 2022 it will be in general usage. It’s my word of the year.
Measured against what swept over Europe in the past year, the past few decades have been an era of calm, reliability and boredom. You have to think back several generations to find a similarly delicate constellation. War, energy shortages, inflation, insecurity – and all this shortly after the great pandemic that has temporarily tied us to our homes without moving. No, it wasn’t a good year overall. And yes, it could have been worse, but it was – and is – bad enough.
Just a few years ago, the term “polycrisis” was primarily used in connection with Europe. The EU was riddled with internal fissures that seemed to be widening. The then Commission President Jean-Claude Juncker used the term again and again after the 2016 Brexit referendum
. He said at the time that he was now leading “the Commission of the Last Chance”. That sounded like: reboot – or perdition.
As we know, there was no restart. Somehow it still went on.
The Berlin think tank Foundation Science and Politics defined the European polycrisis as a parallel development
from “the euro crisis, including weak growth and increasing inequality, the refugee crisis, Great Britain’s exit vote, a rise in anti-European populism and the disregard for democratic and rule-of-law principles in individual member states”.
The quote is almost six years old. From today’s perspective, it reads like a memory of the good old days.
A land war with hundreds of thousands of soldiers in the field
Poly crisis now means: a land war with hundreds of thousands of soldiers in the field, with tanks and howitzers, including targeted attacks on the civilian population and vital infrastructure, just 1000 kilometers from Berlin; threats to use nuclear weapons; blown pipelines; cyber attacks on western institutions and infrastructure; plus inflation rates that have not been measured for generations; cool apartments; expensive groceries; oh yes, Covid is still circulating and the atmosphere continues to heat up.
Europe is challenged like never since the Second World War. There is no relief in sight. The prospects for 2023 are not exactly bright. What is the increase in Polycrisis? self-abandonment?
“Europe is forged in crises” – or not
Crises are times when things can be changed. Because it becomes clear that things cannot go on as usual. The rails on which thought and action have moved up to here have burst. Those who are unable to pave new paths into the future are doomed to stand motionless and unprotected in world history.
World War II was such an event. When the killing ended, the story changed direction. The Western Europeans thought anew. They imagined ways into the future. And then they started building them. It was the Monnet method: small steps that add up to a long path over time.
Jean Monnet, one of the founding personalities of European integration and in many respects its pioneer, wrote a sentence that has since become part of the treasury of European myths: “Europe is forged in crises and will one day be the sum of the solutions that have been found for devised these crises.” From this comes the certainty that every crisis harbors the chance to widen the space of the possible and to let solidified resistance crumble.
We Europeans really blew up the last crises
A nice thought. It’s just that we Europeans really messed up the last major crises. We also seem to be shrugging our shoulders at the current escalation to the poly crisis.
The last major constitutional decisions were made in the early 1990s. In 1993 the European single market was opened. In the Maastricht Treaty, signed in 1992, the community became a “union”. In 1999, some of the member states made the transition to monetary union. They were reforms that were not triggered by crises but by convictions: first, Europe should become more competitive; to do this, it had to overcome the small-scale national markets.
Second, in the long run, endangered the great, now reunited Germany the balance of power in Europe; therefore, the European institutional framework should be strengthened. Since then, however, things have only progressed in toddling steps, and sometimes backwards as well. In view of existential threats, sticking to business as usual is extremely risky.
The Europeans pull themselves together. But that is not enough
In order not to be misunderstood: the EU has proven again and again that it can pull itself together when it counts. It’s the same this time.
During the euro crisis, the countries of the currency union introduced crisis intervention funds (EFSF, ESM) and finally the European Central Bank (ECB) unchained to prevent a breakup of the euro area. During the refugee crisis, the border controls that had been introduced in the meantime were soon abolished again after Angela Merkel and her Dutch colleague Mark Rutte in the Turkey had come forward to ask Recep Tayyip Erdogan for help in closing the immigration routes (and put a lot of money in the window in return). Contrary to fears, no other member state followed Britain’s example. In the Corona crisis, the EU states agreed on a 750 billion redistribution pot (“Next Generation EU”) in order to prevent the EU from further drifting apart economically.
Given the Russian attack on the Ukraine the EU showed remarkable unity in the past year: It is able to impose tough sanctions, even if they cause considerable costs in many member countries. The member states have pragmatically supported each other in the event of energy shortages. As far as aid for Kyiv is concerned, there was initially an embarrassing reluctance in many countries. In the meantime, the EU has launched a support package worth 18 billion euros. Together, Brussels and the member states have pledged more aid than the US
, as determined by the Kiel Institute for the World Economy. Late but significant.
There is no question that the EU can swing its way through crises. On the way towards the abyss, the train has so far always caught the branch to the alternative route. A deliberate dissolution of the EU is not an option, not even for nationalist governments like those in Budapest and Warsaw. After all, the member states are now so closely intertwined that the Union is in fact indissoluble – at least not at a reasonable cost. And how did they plan to survive alone in the global power play? Great Britain In any case, since the Brexit referendum, it has painted a sad picture. (Watch out for the wave of strikes in the week ahead.)
But muddling along in status quo mode will not be enough. The geostrategic situation has changed radically. The poly crisis of 2022 shows how vulnerable we are. Without the rapid and massive help from the USA, Ukraine would have been overrun long ago. Possibly Russian troops are now in the EU member states of the Baltic States, maybe in Finland, maybe in Poland. Because Europe cannot defend itself. Although the EU countries plus Great Britain together spend close to $300 billion a year on the military, our external security depends on US nuclear and other protective support.
Where we would be at the end of this year would not be Joe Biden US President but still donald trump, one can easily imagine: Europe in its previous outlines would have ceased to exist. The answer to the question of what is the increase in polycrisis would then have been: catastrophe.
What is missing is the will
There really is no time to lose. For the foreseeable future, the USA will hardly be able to maintain its present presence in Europe. They are required elsewhere, especially by China. In the face of the geopolitical situation, which is determined by the struggle of the great powers, the only sensible way for the EU is: forward. A new leap in integration is needed. At the center would then be a properly legitimized federal level – with its own joint budget including tax revenue, with a communitized military and a consolidated armaments industry.
This would secure the EU, both internally and externally. The currency would also be easier to stabilize because the ECB would be relieved; it would then have less consideration for highly indebted member states, in particular Italy, take. The credibility of the central bank and the eurozone as a whole would be strengthened. Like every other currency area on the globe, Europe would have a central fiscal level. That would make a lot of things easier.
Unfortunately, the current corruption scandal involving members of the European Parliament, which is evidently literally have had sacks of cash slipped in by foreign governments, not exactly a confidence-building measure on the part of the Brussels institutions. A ruthless clarification is therefore important.
Europe has the means and the size to play on an equal footing with the USA and China. What is missing is the will. Even in the polycrisis year of 2022, there was no jolt through Europe. Just as little as in 2011, when the euro crisis was approaching its climax and at times the entire integration project, including the currency and the internal market, was at stake. Why not?
Publicly, the topic of EU reform is dead
Political scientists have repeatedly stated that Europe is a “polity in the making”. In fact, things are progressing. In surveys, three-quarters of the inhabitants of the EU now describe themselves as EU citizens. More than 60 percent say they feel emotionally attached to the EU; 90 percent say the same about their home country. Which shows that Europe is not an exclusive concept: national and European identities coexist peacefully, even within the same person. Incidentally, in countries with shrill-sounding nationalists in government, such as Poland and Hungary, three-quarters of those questioned admit an emotional closeness to the EU.
Many citizens are quite willing to hand over further core areas of state sovereignty to the EU level, such as a Eurobarometer survey
commissioned by the Commission: 71 percent of respondents in the Member States are in favor of a common foreign policy, 77 percent for a common defense policy, and 78 percent for a common energy policy.
So why is it not progressing? What is missing? Last but not least, an open Europe-wide debate about possible ways into the future. And for a long time.
In a study with colleagues from the Brussels think tank Bruegel
we recently analyzed how media in the three largest Member States Germany, France and Italy have reported on ideas for reforming the EU since the beginning of the millennium. The result is sobering: the topic is actually dead. As a result, there is a lack of public pressure to advance the difficult European reform process – although many citizens seem to want exactly that because they feel that all the major pending issues of peace, security, Prosperity, if at all, can only be answered in a closer EU association.
Our data-based analysis shows that the European reform debate has largely disappeared from coverage since 2005. Before that, Europe still had big plans. A convention drew up a constitution. After monetary union and eastward enlargement, Europe’s top personnel thought they were on the threshold of becoming a European state. But the citizens of France and the Netherlands said in a referendum: No. In the years that followed, the EU tried to ensure the Union’s ability to work by means of additional contracts. Since then, however, it has been taken for granted in European politics that big leaps don’t stand a chance.
However, a lot has happened since 2005. The premises under which Europe lives and works have shifted radically. Again and again the media try to put the topic on their own agenda. But it doesn’t catch on, not with the readers, not with politics, economy, culture, science. During his first term in office, French President Emmanuel Macron dared to come up with a few bold plans for a restructuring of the EU and the eurozone. He earned silence from Berlin. Little has changed in that regard, regardless of whether it is a polycrisis or a “turn of the era” (Chancellor Olaf Scholz).
Despite all the crisis management, the answers, measured against the existential questions, remain meager. Instead of big leaps – such as building a joint nuclear deterrent – there are small hops.
A chancellor without a headline
end of August Scholz gave a speech in Prague
. It should be about fundamentals – about the major decisions, about Europe’s historic mission and the question of what needs to happen now to preserve it for the future. After all, Scholz acknowledged a strong Europe, which should play at eye level in the global showdown and counter the “challenges from outside”.
The text of the speech was published without a headline. That’s probably no coincidence. Because the lecture once again turned into a collection of individual measures: from chip production to migration policy and the hydrogen economy to military air defense. He called for the introduction of EU majority decisions in policy areas where unanimity still applies in the Council of Ministers and was open to changes to the European treaties. You can call that pragmatism. Or despondency. Hopefully we have enough time for that.
The most important economic events of the coming week
Monday
Munich – Sentiment test shortly before the end of the month – The Ifo Institute publishes new figures for the business climate index, the most important leading indicator for the German economy.
Stuttgart/Frankfurt – Turbo capitalism – Only a few months after the IPO of the sports car manufacturer Porsche the share is included in the Dax, the index of the 40 most important German publicly listed companies.
Brussels – ready for change? – Meeting of EU energy ministers. It’s about the climate, the energy transition and the war.
TuesdayLondon – Winter of Discontent I – UK hospital staff strike.
Tokyo – Outsider – Monetary policy decision by the Japanese central bank: While the central banks around the world are tightening the reins, Tokyo has so far been holding back – and interest rates are extremely low.
Wednesday
London – Winter of Discontent II – Ambulances and other NHS workers are on strike.
Thursday
London – Winter of Discontent III – The wave of strikes in the kingdom does not stop. Now the security staff of the high-speed train Eurostar is on strike.
Friday
London – Winter of Discontent IV – Border guards at UK airports are on strike.
Saturday
London – Winter of Discontent V – Christmas Eve of all days: strike at the Royal Mail and British railways for higher wages and better working conditions.