From my AEI colleague Stan Veuger, in The National Interest:
This past Saturday the members of the new European Commission, the “cabinet” of the European Union’s executive branch, took office. Led by former Luxembourgish prime minister Jean-Claude Juncker, the new Commission faces a wide range of challenges both within the Union and in its near abroad. The EU faces an unemployment rate higher than 10 percent, is near deflationary territory, and may well end up in a triple-dip recession. Meanwhile multiple armed conflicts are raging just across its borders, new and extreme political parties dominate the politics of various member states, and secession movements (Scotland, Catalonia) threaten both the EU and its constituent members. The Commission, as always without a direct electoral mandate, composed of commissioners handpicked by national governments and assigned to posts by an unelected leader, may not be able to address these problems by itself, but the priorities it ought to set for the entire constellation of European institutions are clear.
The European economy is still in shambles, and the Eurozone economy even more so. In the latter, the unemployment rate is 11.5 percent, higher than it was at any point in 2008, 2009 or 2010. Astonishingly, it is still around 25 percent in both Greece and Spain. Youth unemployment rates are also near record heights for the Euro area, at over 20 percent overall and over 50 percent in Greece and Spain. Yes, that is correct: around half of the Greeks and Spaniards between the ages of 15 and 24 who want to work cannot find work, and that has been true for years now. The only positive note here is that most of the people who were in that age group at the start of the financial crisis have aged out of it by now. Growth has been minimal ever since the Eurozone last year left recessionary territory for the second time since 2008, and improvements are not in sight.
A lot of this is unnecessary, and European policy makers bear a significant share of responsibility for the harm that has been and continues to be inflicted on especially the younger citizens of peripheral Eurozone members. Most obviously, the common currency continues to look like an unforgivable mistake by a hubristic class of utopian Eurocrats. Sadly, what is done cannot always be easily undone; there is path dependence in the options we get to consider; and dismantling the Euro now would come at a tremendous cost—and in any case, the political courage to even admit mistakes on that front, let alone reverse course, can be found only on the (growing) fringes of the European political spectrum.
I particularly like that Dr. Veuger is aware of the importance of institutions:
But some challenges are internal to the institutions of the European Union. There is still nothing even remotely resembling a European public debate or a European civil society, let alone a European polity. As long as those do not exist, attempts to transcend the supranational character of the European Council and venues along those lines will necessarily be largely technocratic and devoid of democratic legitimacy. It was flags, hymns and constitutions that made Dutch and French voters reject further European integration in 2005; it is a generalized sense of discontent about an unaccountable elite with all the wrong priorities that has led to the rise of protest parties from Syriza in Greece to Podemos in Spain and from UKIP in the United Kingdom to AfD in Germany.
— Michael R. Strain is a resident scholar and economist at the American Enterprise Institute. You can follow him on Twitter at twitter.com/MichaelRStrain.