Europe: So Far, It Flies

Jacques Santer
Jacques Santer; drawing by David Levine


As home to the main institutions of the European Union, Brussels likes to call itself “the capital of Europe.” But the conceit does Europe no favors. Brussels is a dank, irritable city with some of the ugliest public buildings west of Warsaw. Think of it rather as the world’s biggest company town. What they make there is European integration, and the market is booming.

A “European Economic Community” of six countries founded in Brussels in 1957 has evolved into a “European Union” of fifteen (the name was changed in 1992). A dozen more countries, mostly ex-Soviet satellites from Central Europe, are pressing to join. The engagement demanded of Union members has evolved from a relatively simple set of rules covering trade and agriculture to acceptance of a sprawling corpus of European law—90,000 pages at last count—touching every large aspect of economic life and a growing number of noneconomic aspects besides. This year’s innovation has been a common currency, the euro, adopted in eleven countries of the Union so far. The other four have stayed aloof for a mixture of political and economic reasons, but all—even so-far skeptical Britain—appear likely to join within five years at most.1 The rise of the European Union has been counterpointed by the decline of other big ideas, such as the Soviet-sponsored Comecon and the British-inspired European Free Trade Area. Whatever the EU’s absolute merits, there is now no rival project for “Europe.”

For many economic purposes, although not for most political ones, the Union is integrated enough to demand that it be viewed as a single entity. It has all but abolished national barriers internally to the movement of goods, services, capital, and labor. With relatively few exceptions, the main ones in banking and other financial services and in pharmaceuticals, nothing stops a company based in any one EU country from selling its goods and services in all fifteen countries. And nothing, in principle, stops a citizen of one country from taking a job in another (save for many public-service jobs which are still reserved for a country’s citizens). London is full of German bankers, Berlin is full of British construction workers. Foreign trade is governed by a single set of tariff and quota rules binding on all countries; a single European team of negotiators represents all the EU governments in international trade talks.

That said, national governments do argue fiercely among themselves about the sort of trade deals they want to strike, with France often leading the protectionist faction. (For example, Denmark and the Netherlands oppose the EU’s use of tight quotas to restrict imports of bananas from Central American countries, a practice which is provoking a minor trade war between the EU and the United States. In recognition, the US is trying to spare Danish and Dutch products when choosing European goods for punitive countertariffs.) And EU governments do sometimes interfere unilaterally with the…

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