The EU and the Creative and Destructive Impact of Crises

Since the beginning of the eurozone crisis in 2009, the EU has experienced a series of challenges, including a massive influx of refugees, Brexit, the coronavirus pandemic, and the Russian invasion of Ukraine. It is safe to predict that this era of crises will continue for a number of years. Geopolitical rivalries and turmoil in neighboring regions, deep economic and social inequalities, and accelerating global warming make for a tougher environment than the union has ever faced. The EU’s track record of crisis management over the last decade offers lessons that can be applied to current and future challenges. The key question will be how the union can muster the necessary solidarity and cohesion to survive in an increasingly contested and complex world.

In the words of Jean Monnet, one of the EU’s founding fathers, “I have always believed that Europe would be built through crises, and that it would be the sum of their solutions.” The past thirteen years, during which the EU has confronted one major challenge after another, have confirmed the wisdom of this famous quote from his memoirs. The EU’s financial crisis (2009–2012) brought about major innovations in the union’s financial architecture, and the massive influx of refugees into Europe in 2015 and 2016 resulted in a substantial upgrading of the mechanisms to secure the union’s external borders. The British decision to leave the EU ended up enhancing the cohesion of the union’s remaining members and unblocked negotiations on defense policy. The early months of the pandemic led to the EU recovery fund, which constituted a breakthrough for the financial solidarity of member states, and gave rise to the union’s first collective vaccination program. Finally, Russia’s invasion of Ukraine prompted a massive mobilization of the EU’s external policy in support of Ukraine including, for the first time, the delivery of weapons and a tough sanctions regime against Moscow.

Monnet also offered an explanation for this creative effect crises can have when he added, “People only accept change when they are faced with necessity, and only recognize necessity when a crisis is upon them.” What is true about people is even more true about a complex, multilevel organization with heavy decisionmaking procedures and all the inherent difficulties of collective action. Strong external or internal pressure, acute urgency, and the clear risk of inaction are often necessary to convince the EU to break with its preference for incremental progress through long technocratic negotiations and to instead act boldly and decisively.

Stefan Lehne

Lehne is a senior fellow at Carnegie Europe in Brussels, where his research focuses on the post–Lisbon Treaty development of the European Union’s foreign policy, with a specific focus on relations between the EU and member states.
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Monnet published his memoirs in 1976, which shows that this positive impetus of emergencies has a long tradition. Still, the process of innovation through crisis reached a new degree of intensity during the last thirteen years of a seemingly permanent state of crisis. Few of the innovations of these years were provided for in the EU treaties and the union’s other programmatic documents. Most came about through improvisation, often emerging from late-night sessions of the European Council. Some of the steps taken during this period marked an important transition. Alongside its role as a norm-setting apparatus, the EU is developing into an executive actor. Direct operational engagement such as collective purchases of vaccines and possibly, in the near future, shared bids to buy energy resources and deliver military support to Ukraine would have been unthinkable just a few years ago.

Crises are thus often a necessary stimulant for the development of European integration. However, the much-repeated view that the union always emerges strengthened from crises is quite wrong. If it were true, given the proliferation of major challenges recently, the union would today have to be in brilliant shape, which clearly is not the case. In fact, each crisis affects the union in different ways. Some create conditions for progress, but others are divisive and harmful. And sometimes the urgency of demands for crisis management result in suboptimal solutions, which then become permanent when the pressure for change is no longer present. The exact dynamics triggered by a given crisis need to be examined on a case- by-case basis, but there are some elements that are frequently in play. A key criterion is whether a crisis adds to the solidarity among EU member states or detracts from it.

The EU’s Responses to Various Crises

Financial Reforms Amid the Global Financial Crisis

The effects of the financial crisis on the EU illustrate this point well. The monetary union as conceived by the Maastricht Treaty previously had been a half-finished project lacking adequate safeguards and mechanisms for financial solidarity among member states in cases of emergencies. When hit by the consequences of the U.S. sub-prime mortgage crisis, Europe’s financial system came close to collapse. But the impact of the crisis was uneven. Southern European members of the eurozone suffered a great deal more than others. They not only fell into a deep recession but also had to implement harsh austerity policies imposed by Northern European members as the condition for the bailouts they received. The consequent anger of affected Southern European populations opened up a rift between Northern and Southern Europe that hampered EU cooperation for a number of years.

Yet, despite the asymmetric impact of the crisis, all EU members also faced the common threat of a breakup of the eurozone, which would have had devastating consequences for all of them. This grave risk prompted EU members to pull together in spite of all their divisions and to agree on a far-reaching overhaul of the EU’s financial architecture. This included emergency funding programs, new binding fiscal rules, and the launch of a banking union and was complemented by unprecedented financial operations by the European Central Bank, which stabilized Europe’s banking system and offered financial support through bond purchases. Thus, in this case, the uniting effect of the imperative of averting economic catastrophe proved stronger than the divisions engendered by the crisis. The EU’s monetary union has still not been completed, and some important reforms remain blocked. But the steps taken during the crisis undoubtedly have made the eurozone more stable and have enabled it to weather subsequent economic disruptions.

The Migration Crisis and Changes to Immigration Policy

Europe’s migration crisis in 2015 and 2016, during which more than 1 million people mostly from Syria and Afghanistan entered the EU, serves as a counterexample. Here, too, an ambitious integration project, namely the Schengen passport-free travel zone, proved insufficiently robust to cope with a serious challenge. The sudden, massive influx revealed deep fissures in the union. Members’ different historical experiences shaped sharply contrasting attitudes toward immigration. Countries like Germany, Sweden, and some others with long experiences with high levels of immigration initially took a welcoming stance, whereas Central European countries, which for decades had existed in relative isolation, aimed at preventing people from entering their territory. Equally serious were the tensions deriving from geography. The frontline states in Southern Europe, where the bulk of the refugees arrived, complained about a lack of solidarity, while Northern European countries, where a large share of the refugees ended up, criticized the Southern European governments for not living up to their obligation to process the asylum requests in their countries, as required by the Dublin Regulation. Populist and nationalist parties that usually also have anti-EU platforms exploited these growing antimigration sentiments and gained ground in several member states.

It is true that this crisis led to innovations in migration policy, such as an expansion of the capacities of the European Border and Coast Guard Agency (also known as Frontex), the body charged with supporting the policing of external borders, and those of the European Union Agency for Asylum, an agency aimed at helping and coordinating member states’ asylum policies. Moreover, the EU became more active on the external dimension of migration policy. In particular, an agreement with Turkey reached in March 2016 proved crucial in stemming the inflow of migrants.

However, these steps did not outweigh the crisis’s negative impact on the cohesion and solidarity of the EU. The strengthened institutions still lack executive powers that would ensure reliable and effective control of all the union’s external borders. To this day, the Schengen Area has not returned to full functionality, as border controls persist between a number of countries. As the issue of burden sharing could not be resolved, there is still no agreement on a new, comprehensive asylum system that would replace the broken Dublin Regulation. The inherent tension between the ideal of borderless travel and member states’ wish to control who enters their territory has not been resolved. All this means that the union remains vulnerable to renewed waves of mass migration, which in view of the manifold threats to the stability of Europe’s neighborhood are highly likely.

The Pandemic and the EU’s Response

The pandemic has shown the complex dynamics of the EU’s crisis response particularly well. When the virus first caused large numbers of deaths in Southern Europe, a mindset of every state for itself took hold. Barriers between EU countries went up in futile attempts to keep the virus out, and governments competed to acquire personal protective equipment. This left little space for European solidarity, further alienating the populations in the most heavily affected Southern European countries. Governments adopted sometimes sharply contrasting public health policies and initially resisted the European Commission’s efforts at coordination. Negotiations on a common response to the sudden collapse of Europe’s collective economy were hampered by the old ideological divisions between Northern and Southern European members. But after a few months, attitudes began to shift.

As the virus spread throughout Europe and brought the continent’s economy almost to a standstill, the crisis was increasingly perceived as a common threat that would have to be addressed by collective action. Northern European countries (particularly Germany) understood that the disastrous economic consequences of the pandemic for the Southern European member states posed great risks for the future of the eurozone. Abandoning long-standing taboos, they agreed to the commission’s proposal for a recovery fund of 750 billion euros, which would be raised by the commission on the financial markets and disbursed largely as grants. Incidentally, this massive expansion of EU funding also helped mitigate the North-South tensions inherited from the 2007–2012 financial crisis.

In parallel with this initiative, the EU achieved a similarly significant breakthrough on public health policy. Although the competencies in this area remain mostly with the member states, the union agreed on a joint vaccine procurement program. While the rollout of the vaccines suffered from delays, the program in the end turned out to be a major success, as it ensured equal access to vaccines for all member states regardless of their economic strength. It also proved that, with the necessary backing by member states’ governments, the EU is capable of innovative operational engagement.

Russian Aggression Against Ukraine

The governments of EU members from the start perceived Russia’s attack on Ukraine as a breach of basic international law and as a challenge for the entire union. Hence, the EU responded rapidly and with remarkable unity and determination. Even countries that had traditionally maintained friendly relations with Russia fell into line.

But as the war continues and as the collateral damage of the crisis for the EU mounts, asymmetries are beginning to emerge. Most countries in the northern and eastern parts of the EU view Putin’s aggression as a direct threat to their national security. They push for even tougher sanctions and more military support for Ukraine. From their point of view, a clear defeat of Russia constitutes the only acceptable outcome of the war. In the southern and western parts of the union, there is less fear of Russian military aggression and more worries about the war’s impact in terms of energy scarcity and inflation. As a consequence, one hears more and more calls for an early ceasefire, even if this would freeze a military situation unfavorable to Ukraine.

It will require considerable political leadership to overcome these divisions and to ensure the EU’s continued coherence in confronting an aggressive Russia. This example shows that EU members’ individual stances do not always evolve from a greater diversity of views toward greater unity (as in the cases of the pandemic and the financial crisis): the reverse is equally possible.

Lessons Learned

The last thirteen years have rightly been called a permanent state of crisis. It is not difficult to predict that the rest of the 2020s will be similarly fraught. As long as Putin sits in the Kremlin, and quite possibly for even longer, Russia will continue to be a threat to European stability. The energy supply crunch, partly related to the war, is also unlikely to go away rapidly. Energy scarcity plus inflation could trigger an economic downturn in Europe with severe socioeconomic consequences. Rising food prices could bring starvation and social disruption to large parts of the Middle East and North Africa. Deteriorating U.S.-China relations and a host of risks to stability in the regions surrounding Europe threaten to usher in further geopolitical challenges. Another “America First” U.S. president could damage transatlantic cooperation and leave the EU to its own devices in dealing with crises. And climate change, manifesting itself more painfully from year to year, tops the list of known threats, as its impact affects many dimensions of life including food production, public health, security, and migration.

What lessons can be learned from the EU’s recent experience of crisis management and applied to the handling of current and potential future crises?

Overcoming the Nation-First Reflex

As the pandemic has shown, a sudden emergency often initially triggers a nation-first reflex. As governments are primarily concerned with the safety and well-being of their own citizens, the initial phase of crisis management can be marked by a largely inevitable high degree of national egotism. Governments naturally prefer to deal with critical situations themselves. And as long as negative effects on the EU’s internal solidarity can be avoided, there is nothing wrong with this.

During the pandemic, initial restrictions on travel, transportation, and trade endangered the functioning of the EU’s internal market, but thanks to pressure from the European Commission, this impulse was corrected after a few weeks. Later, Germany, France, and some other Northern European states could probably have procured vaccines earlier if they had proceeded on their own or in a smaller group. But this choice would have been badly received in the poorer parts of the EU. The joint vaccine procurement program thus had a cost for the strongest and wealthiest member states. But this cost was worth paying, as it helped preserve the cohesion of the EU as a whole. By contrast, the damage of the persistent inclination toward uncoordinated national action during the migration crisis of 2015–2016 was longer-lasting and still has not been fully overcome.

When the governments of EU member states reach the limit of what they can accomplish with national means, they usually turn to collective action. But this often happens at a late stage, when earlier EU efforts would have had better results. Overall, it would be desirable for this shift from national egotism to collective responsibility to occur earlier in a crisis. Systematic EU-level preparations for various crisis contingencies, including the stronger use of forecasting and scenario planning and intensive communication between institutions and governments early in an emergency could help in this regard. The EU already has a number of crisis response mechanisms in place, such as the Integrated Political Crisis Response mechanism and the EU Civil Protection Mechanism. In light of the experience of the most recent crises, the commission has now proposed the Single Market Emergency Instrument, which is aimed at preserving the free movement of goods, services, and persons, as well as the availability of essential goods and services, in future emergencies.

Dealing With Asymmetries

Asymmetric shocks that leave parts of the EU unaffected or even pit member states against each other are inherently more difficult to manage than crises affecting the entire union in a similar fashion. The migration crisis has demonstrated how differing interests combined with ideological diversity can frustrate attempts at collective action. However, most crises contain symmetric as well as asymmetric elements. This was the case during the financial crisis with the divide between Northern and Southern Europe amid the threat of the collapse of the euro. It holds also true for the geopolitical clash with Russia, which constitutes a challenge to the EU as a whole but affects different parts of the union in different ways.

The current energy crisis serves as another example of asymmetries hindering coherent EU action. Soon after Russia’s full-scale invasion of Ukraine began, the European Commission had already warned of the negative consequences of Putin’s use of energy exports as a geopolitical weapon. But the interests of the member states in this policy area are diverse. Different countries use different energy mixes. Some are highly dependent on energy imports from Russia, while others are not at all. There are many national champions with entrenched interests and long-term contracts for the delivery of energy resources. Early appeals for collective action to impose price limits or to buy energy collectively therefore met with considerable resistance. Only in August 2022, as prices skyrocketed, threatening a massive disruption in the winter months, did many governments begin calling for common action, albeit without agreeing on the exact steps to be taken.

In light of this diversity of views, the commission is proceeding cautiously. It proposed taxing the windfall profits of energy firms, recommended several energy-saving measures, and greenlit state subsidies to troubled producers. A majority of member states demanded an EU-wide price cap on gas, but some of the richer countries prefer to rely on national measures. In particular, a 200 billion-euro German support package created much resentment in less affluent countries and threatens to reopen the North-South rift in the EU. At this point, it is still possible that the EU will develop a strong collective response to the energy emergency based on common energy purchasing, price caps, or a new financial package modeled on the recovery fund. If not, it will likely end up with an incoherent patchwork of national measures and mutual recriminations between member states, an outcome that would also detract from the solidarity needed for confronting Russia.

Similar dynamics seem to mark the EU’s work on climate change. As there is only one planetwide climate, fighting global warming should obviously be a common concern that not only unites the entire union but also calls for strong engagement with other countries worldwide. In fact, the union has managed to play a leading role in setting international targets for the climate transition. But setting ambitious targets was the easy part. The union’s internal negotiations on implementing policies and measures have already shown that members’ uneven dependencies on fossil fuels and divergent industrial interests are often difficult to reconcile.

In addition, the changing climate manifests itself in droughts, fires, and floods that affect different parts of Europe in different ways. Part of the impact of the climate crisis will be sudden and localized, requiring immediate responses in the places directly affected. Other effects will manifest as gradual changes in conditions calling for broader, long-term policies. Mitigating climate change presupposes solidarity beyond borders, as no single state’s actions to reduce emissions will move the needle in isolation, unless others move in the same direction. By contrast, adapting to climate change may follow different dynamics, as the necessary measures can often be taken at a local or regional level and differences in wealth and economic development will play a major role.

These divisive, asymmetric dynamics could hamper the EU’s ability to forge common solutions. However, the high level of economic integration within the union and the mutual interdependence arising from it should help counteract these tendencies. Any serious challenge to parts of the union will eventually affect other member states too. Solidarity arising from pure altruism is a wonderful thing, but it works best in interpersonal relations. Among states, it is more plausible to rely on solidarity based on enlightened self-interest. The union’s internal market is possibly the strongest and most reliable pillar of solidarity among member states. But as these mutual dependencies and the consequent contagion and spillover effects of emergencies are not always understood in the early stages of a crisis, the path to common solutions can be rocky and long. Enhancing the EU’s collective capacity to analyze and evaluate the broader impact of asymmetric shocks could go some way toward mitigating this problem.

Marshalling Political and Institutional Leadership

Ultimately, an effective crisis response is a political challenge and requires leaders that are capable of transcending the confines of national politics and understanding their responsibility for the future of the EU. Former German chancellor Angela Merkel’s support for the pandemic recovery fund was exemplary in this regard. She understood the dangers of the devastating economic impact of the pandemic on Southern European members and sacrificed long-standing principles of German orthodoxy to allow a new, large-scale financing program. It is not clear whether the current German government is capable of similar leadership in the energy crisis.

Traditionally, European leadership in crises was primarily expected from France and Germany. Their contributions remain necessary, but in today’s more complex and heterogenous union, it is no longer sufficient for Paris and Berlin to set the course for the union as a whole. Nowadays, constructive initiatives and obstruction can come from all parts of the union.

The European Council, composed of the EU members’ heads of state and government, will remain the key decisionmaker in urgent crises. It is the only body with sufficient authority to improvise. As crises have proliferated in recent years, the European Council has met more frequently, including (since the pandemic) in a virtual format. However, its working methods also should be adjusted to the tougher demands of an era of permanent crisis.

As for international crises, a strong case can be made for setting up a support structure for the European Council roughly modeled on the National Security Council in Washington. Such a body, which could form a special part of the European External Action Service, would analyze and assess international developments and provide strategic advice to the European Council. Having a shared assessment of a situation, in addition to national briefings, would help the EU’s twenty-seven members reach substantive decisions. This support structure could also serve as a clearinghouse for high-level European diplomacy of the institutions and member states while helping coordinate messages and policies.

While the member states still call the shots, the European Commission has assumed a greater role in crisis management. Often, its technical expertise and operational capacity are essential for developing EU-level solutions. As the college of commissioners with its twenty-seven members is a cumbersome body, the president of the commission (supported by its Secretariat-General) has emerged as the central actor. In recent years, it has been the commission president and the heads of government of the EU’s larger member states who have shaped the union’s response to crises. The commission usually does not make formal proposals, unless it sees a reasonable chance that they will be adopted.

The multiple challenges of the coming years will undoubtedly require an increase in the commission’s crisis-management capacities through greater resources and more flexible, more nimble procedures. To enhance the coherence of the institution, it will also be important to enhance the president’s ability to shape her own team of commissioners.

Forging Resilience Through Trust

In stressful situations, horizons shrink, and immediate concerns crowd out broader considerations. Governments only overcome their nation-first mindset in emergencies if they are convinced that common efforts add value and if they believe that their partners will cooperate effectively and loyally. In the case of Europe, trust among the union’s member states and toward and within the EU institutions in Brussels is a key ingredient for successful crisis management. Such trust is fostered by common interest based on deep economic integration and interdependence. This process is also self-reinforcing: just as trust is necessary for reaching solutions, delivering such solutions is the best way of building further trust. A positive track record on handling challenges increases the plausibility that present and future crises will also be managed effectively. After a deep crisis of self-confidence in the mid-2010s, the EU now, thanks to a number of recent successes, appears more certain of its ability to solve difficult problems.

But just as confidence can be built up, it can also be destroyed rapidly. Mistakes and delays can have high costs in terms of goodwill. The long-standing habit of member states’ governments to shift blame to Brussels when things go wrong can undermine public support for European solutions. Internal divisions, such as the union’s divide between Northern and Southern European members over demonstrating solidarity versus calling for responsibility on fiscal matters or the illiberal policies and violations of the rule of law by the leaders of Hungary and Poland diminish mutual confidence among member states and tend to spill over into various aspects of the EU’s work. If energy scarcity and inflation were to result in a severe economic setback and social disruptions, this would reenergize the populist and anti-EU movements across the union and could weaken the union’s ability to act together.

In view of the union’s inherently fragile cohesion, building trust among member states and toward the EU institutions must be an ongoing concern. It is a joint responsibility of member states’ governments and EU institutions that needs to go well beyond the realm of political elites and involve civil society systematically. Governments will more readily engage in collective action on the EU level if their broader populations are favorably disposed. And ordinary Europeans will only support EU engagement if they understand that integration not only offers substantial benefits in terms of prosperity and stability but also involves a shared responsibility for the well-being of every partner in this endeavor. If the EU, which now includes less than 6 percent of the world population, doesn’t want to be pulled apart by an increasingly turbulent world, it will have to overcome traditional conceptions of national sovereignty and rise to a new level of unity. Stronger and more deeply rooted bonds of solidarity will be the best guarantee of the union’s resilience in an era beset by crises.

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