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European values, the US and the scenarios

European values, the US and the scenarios

Please click here to return to comment 8 of the main paper.

Look, I'm not going to pretend that everything is rosy in Europe right now, but to assume that it is the black spot which retards everything else in the world seems to me crazy. I see the European ideal as a bright spot in the world, something that is selfless and set up really to be better than what went before.

Well, I say that, but what is this "ideal"? Romney's running mate Ryan has said that America was built on "an idea". I searched Google for "America + US + ideal", verbatim, and I got around 120 million hits. But then I did the same thing for "Europe + EU + ideals" and I got slightly less than 300,000. Is the US 400 times more loquacious about its identity, or 400 times less secure? Let's get to that in a minute. I want to pursue this "European ideal"

Europe

I scanned a selection of European entries and found doubt: what was the European ideal? Given that, what was the European union to be? Why, above all, was nobody of importance debating this in public?

In "The Divided West", J├╝rgen Habermas thought that Europe had the following defining characteristics:

This model reads a true central ethos for some countries, and as a Left aspiration for others. It has, however, made great progress towards a true zeitgeist in the past generation. In particular, the collectivist element, and the great variety of social crimes - being rich, acting in ways that may make you dependent on the state (by smoking, for example) - has grown sharply towards a new orthodoxy.

It is interesting to think a little further along these lines. It is a social crime to flaunt your wealth if it was gained through conventional commerce, but not at all a problem to do so if the money was gained through sport, the arts or entertainment. A whole subculture of magazines exist to display the results of such success. It is acceptable to stand out through eccentricity, but not through achievement, except - once again - in these few categories. Essentially, those areas in which flamboyance is acceptable are those where ordinary people could imagine themselves participating and where they could feel themselves at home.

The concept of "cool" catches this exactly. A cool device, dress style or way fo behaving positions itself at the edge of a social group, and in a direction that it wants to go, but not too far from the centre. If a style goes too far, it passes out of the group comfort zone and becomes alien, something of a threat. It is no longer cool, but 'nerdy', 'elite', 'not for us' and perhaps somewhat challenging, discomforting if it makes us feel left behind. There is, surely, a strong class-based element to this: a recognition that societies are innately unequal, and that it is better not to talk too much about this in public. Europe likes to pretend that we are all the same, and deprecates hugely reminders that we are, in fact, not so. It may be that much of Europe's cultural root lie in unresolved class conflict, in the vain hope that classes will melt away.

This model has its strong points: principally, it values individuals and it loathes what have been the roots of many conflicts. Its weak points are, first, that it has difficulties with excellence, achievement and the notion of individuals winning out over the collective, even if the collective is enriched thereby. Second, in growing the model of communal support, it places individuals in an environment that makes everyday life seems as natural as the growth of a forest, and creates a population of urban hunter-gatherers who make no effort to cultivate or even to think where the fruits of civilisation come from. Indeed, "the system" is so pervasive but so intangible that taking what would elsewhere seem simple actions, such as starting a company, seems almost against nature, too complicated to consider. The frontiersman ideal of the US, by contrast, sees a far simpler structure: the regulatory complexity may be identical, but the perception of statist fog and muddle is much less to that perspective.

America

Everyone notes that that Europe has had a terrible past. As suggested above, many of its values consist of the repudiation of what it sees as the roots of this, and the tiptoeing around issues of class that have never been resolved. America, by contrast, was supposed to have sprung whole from the frontier, the classless melting pot, in rejection of European compromise and corruption and dedicated to freedom and enterprise.

Of course, it did not. The frontier was long gone when its industrialisation took off. It was a primarily agrarian nation for only a short period, and most of its people have lived in towns or cities for most of its history. Its population was far from classless and its democracy far from universal: black males got the vote, in theory, in 1870, women in 1920 and full adult suffrage developed from 1965. It political structure was sufficiently imperfect for the civil war to break out. and event of such ferocity that it killed proportionately more of the combatants than any previous war. America invented itself an identity through an act of will and through deliberate propaganda, doing so at the height of the immigration boom from Europe in the period after the agricultural depression that began in 1870. Those values, carefully erected, have supported the extraordinary growth in the US economy over more than a century, and still influence political thought today.

Immigrants were to be subjected to 'Americanization', This was officially defined as "a concerted movement to turn immigrants into Americans, including classes, programs, and ceremonies focused on American speech, ideals, traditions, and customs." As a broader term, it was also used in debates about national identity and fitness for citizenship. This program was heavily influenced by two writers, Frederick Jackson Turner and Theodore Roosevelt, ultimately the 26th President.

Turner's key book is "The Significance of the Frontier". In this, he establishes the very influential notion that the frontier helped both to establish American identity and break away from European influence. In other words, westward expansion was a "steady movement away from the influence of Europe, a steady growth of independence on American lines". What happens in the frontier is the creation of the American. Certain qualities such as strength, quickness of the "grasp of material things," came from life on the frontier; as did connection with nature, personal freedom, the need to live with the consequences of your own actions and the importance of reputation in a small community. The frontier told one when to fall back on the community - to fight off an attach or a forest fire, for example - and when self-reliance should come to the fore.

Teddy Roosevelt had similar views, expressed in dozens of books. His book "American Ideals and The Strenuous Life" describe how Americans should be. "There was scant room for the coward and the weakling in the ranks of the adventurous frontiersmen." Cowboy life had a comradeship that led to cooperation without coercion. A simple morality, set against the wilderness, led to clear morals and the need to seize opportunities or die. Corruption tended to follow accumulations of wealth, and a corrupt society led to corrupt politicians. A society made up of property owning individuals, endowed with common sense and liberty, enjoying the fruits of their labour in ways that helped society was the best counterweigh to corruption.

This model of America is at war with large government, monopolistic corporations and corruption, as defined by special interests that act against the common good. It is also a model that does not know what to do with the people in the society who do not fit with this model of self-reliance and self-sufficiency. This remains true today. We can see this from the very coherent speeches made by the Republican Vice-Presidential hopeful, Paul Ryan.

Ryan's notion of the American ideal is set specifically in contrast to what he sees as the European model. His American is self-reliant rather than welfare-dependent, a self-motivated risk taker with a strong pragmatic streak. These characteristics were first formed from practical life on the frontier, now honed for modern America. Such a person wants a minimal back-drop of a state for all but emergencies, happily pays taxes for that and expects otherwise to profit from the fruits of their labour. If they are concerned with others, it is to shape those who cannot shape themselves to participate in the American ideal - through education, through health in early life, through safe streets. They accept that adults do need charity, but they are also clear that there exists a deserving poor to whom support should be given - the ill, those who have participated in the American ideal but who have suffered personal tragedy - and that there are those who had their chance but did not take it, to whom nothing but the most basic support is owed. If that.

Perhaps Romney will adopt notions from Roosevelt, which have strong resonance in today's world: how to manage corporate America, and particularly US banks, without damaging the system? What is the primacy between economics and the interests of the populace and the natural world? Is the state a mere backdrop, or are there things which the state needs to catalyse that lie between commerce and the citizen, such as knowledge provision, science and other public goods? More profoundly, what is to be done with the large fraction of the US population which has a limited role in the modern world?

Back to Europe

What all versions of Europe-the-ideal have in common - from the geographical to the metaphysical - is that Europe is an idea, an abstraction. Quite what constitutes this abstraction is never made clear. Notions vacillate between, on the one hand, that the unifying feature is a common set of values and a mutual attraction of similar cultures shaped by a common history; and on the other, that the project a hodgepodge of practical motives for which "values" are merely an ornament.

These practical values can be summarised - for today's world, as they were different half a century ago - as follows:

  1. Conflict avoidance through mutual economic dependence and better mutual understanding.
  2. Economic advantages of scale that arise from a customs union; free flow of labour and ideas; mutual funding of collective issues such as research, environmental concerns and so forth.
  3. Collective bargaining power and negotiating weight in the international arena, given common goals, of course. That is, to project European values and interests as soft power.
  4. Economic stability and weight, given resolution to the current situation, which is of course the exact opposite of this.
  5. State obligations that are easier to fulfil jointly - policing, crime and terror, tax collection and regulation. Joint management with other powers - US, perhaps China - given an equivalent scale and economic weight.

Those are all fine goals, if in some cases of marginal benefit as compared to the likely effort required to deliver them. Other, unspoken goals, tend to comprise the imposition of some of the values already discussed on countries that do not want them, or do not give them the same priority. On the whole, however, these represent a blameless list. The first and second have been achieved, and many would think that this should draw a line under the overall project. The final three require, in their various ways, a commonality of interest that simply does not exist. German and Spanish interests in - say - Latin America are completely different. France has interests in North Africa that have little meaning to - say - the Baltic states. In those situations where there is common interest - in free trade, for example - there is little reason to suppose that delegating this to EU level, inevitably in a generalised, diluted way, would get "better" results than would nation-by-nation representation.

These are, however, policy frills that would follow from much tighter political - and particularly, central banking - integration. One can take two postures on the sovereign debt-Euro complex of issues. The pro-integration stance says three things:

  1. That we need to save the Euro because its collapse would generate another global crisis.
  2. That the necessary integration of fiscal and monetary policy disciplines - if not full integration - that is needed to save the Euro would anyway be good for the countries involved. Indeed, they say - look what has happened without such disciplines.
  3. Given the two points above, then, why not simply integrate central bank functions at the European level? And fix tax raising and spending powers for individual states. And...

There are of course, two kinds of opposition to this. One variety, let's call then the Ultras, hate the entire European project and wish to reduce it to something like the old EFTA, a customs union. A more reasonable group like European achievements, buy into the values of close partnership, but cannot see the value of continuing with the Euro it its current form. They suggest that there are many potential mechanisms by which the Euro could dissolve to an ERM-like structure, could alternatively shrink to a core of willing countries or otherwise reduce its scope. The costs of doing this are reasonably clear, and are far less than an endless bail-out for the Mediterranean countries. Beyond this, they make a number of points.

First, the Euro was a prestige project, aimed to crystallise a sense of European progress. Its supposed economic benefits - lowered transaction costs and reduced risks - are self-evidently false. Modern financial technology has solved both issues as far as companies are concerned. So its loss might be a humiliation, but nothing more than that.

Second, what we have is not, deep down, a sovereign debt problem. It is the problem of extremely dissimilar economies pretending to have identical properties. With all the discipline in the world, countries like Greece or Portugal cannot become Germany. The Euro regime may not have suited Greece and others, but it also has not suited Germany, which is now running a huge current account surplus. In effect, as you have mentioned elsewhere in this scenario process, Germany is in effect fining its people for belonging to the Euro. They have to pay more for imports, and their exports are worth less than a free exchange rate would earn for them. The Euro has distorted a continent.

So: there exist three outlooks.

One, the official future, has a more integrated Europe pressing for a common set of values, for the complete integration of the the 35 chapter headings of the acquis communautaire, and the Euro and the economies that it represents both stabilised and brought into productivity parity. Democratic institutions would spring into existence at all levels, cross-coordinating themselves to "supplement" national legislatures. This is trajectory to a United States of Europe.

The second perspective is an orderly retreat to a structure that is more than a customs union and, at the core, considerably more integrated so as credibly to retain the Euro. The periphery are arranged in a hierarchy of integration with the core, earning deeper connections through compliance with the new acquis of the core. The notion of universal values - and particularly, de facto welfare entitlements - would have been abandoned, save as an aspiration.

The third perspective involves a disorderly or unilateral retreat from the Euro, less through the departure of Greece than the implied or actual terminal impatience of Germany. The stable outcome would probably resemble Europe as it was in the mid-1980s, but with both more tightly integrated values and a much weaker sense of direction. The global impact on the financial system is not known and is probably unknowable.

This fits very well with Comment 1. I do not think that I have refuted Comment 4 - indeed, I value it extremely. However, whilst I see all of the elements that they describe, I do not see Europe "becoming American" any more than the US will "become Europe." Whilst there is small chance that the US will fail economically in the scenario period, there is every prospect that Europe may do so, at least in part. America's weakness is that it may find itself in conflict with China. That is its cross: too much of that frontier spirit, "scouring the world for dragons to slay".

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