Europe 2030: The citizens,the sun and the Union

Abstract

In Europe itself, the EU has been a success. But its new challenges are mostly global: the rise of Asia, climate change, the end of the industrial age, the information revolution and an ageing population. To address these effectively, the EU should draw strength from its values of human rights, freedom, democracy, equality and care for people and the environment. In the years to come, it will need to rely increasingly upon three key resources: the people, the sun as an energy source, and the Union itself. The EU has been perfected through generations. Its strength lies in its openness to enlargement and its readiness to deepen its structures. Rather than going through another institutional change, it should learn to use the tools it has to deepen the common market and extend it to vital new areas of competition.

The European Union has been a successful idea. It brought peace and democracy to the continent, and it unified most of the region to experience cooperation, relative wealth and, on average, one of the best standards of living in the world. In the first decade of the twenty-first century, the EU has almost completed its deepening and widening by successfully expanding to include 12 new Member States, introducing the euro, creating and expanding the Schengen area and agreeing on a new treaty.

But these achievements, while historic, dealt with local, European issues. Since the end of the Cold War, the world has changed even more than Europe has. The main challenges that the European Union faces today are global in nature.

The next few years will define what role the EU will choose for itself. Europe must stay in the lead when it comes to the well-being of its citizens, the protection of human rights, democracy and collaboration. After years of introspection, however, will Europe also assume a determined global role in protecting European interests on the world stage, making both Europe and the world a better place? Or will it be a Union that will slide into marginalisation and become a looser and looser group of former global powers in the distant western corners of Asia?

This article presents some ideas for moving in the first direction. First, it presents a brief analysis of the disruptive changes that the world is experiencing—how they affect us in Europe and what options we have in responding to them. It then identifies the strengths the European Union has in addressing these changes, the values and principles we need to hold to and the change in perspective that we need. Finally, three key ingredients of our future are described, along with several key recommendations.

Global disruptions

The world is going through a series of changes which, when coupled with the economic crisis, will create significant discontinuity with the past. The future will not be a version of the present; instead, in many ways, it will be ‘a grand transformation’ of what we now know [12].

From an era of Western dominance to the rise of the East and South

Brazil, India, Russia, China and other countries represent a changing of the tides in the world's economic, technological, scientific, political and military power. By 2020 the EU will no longer be the number one economy; it will be number three, dropping from about a quarter of global GDP to less than a fifth [9].

Increased prosperity around the world is a good thing. It means that billions more people will rise out of poverty. It also means that many more will have needs similar to ours. It means bigger markets for products and services that we are offering already.

It also means more competition, however—not only among European workers but also among innovators, engineers, scientists and scholars. Since the Renaissance our capacity for cutting-edge science, innovation and creativity has been the source of our strength and wealth. The role that the EU and European countries play on the international scene is linked to the vitality of their science and innovation, the strengths of their populations, the vibrancy of their economies and the potency of their diplomacy and their militaries. Europe's objective share in all of these areas is likely to diminish in the future.

The EU can either try to maintain the status quo by building walls and preventing competition—or it can accept the challenge and compete on a level playing field, focusing on its own absolute progress rather than envying other economies that are catching up. The EU can either try to maintain the global order in its post-Second World War shape, whose architecture has been quite favourable to some European powers—or it can exercise an ambition to be a player on the international scene, shaping the next global architecture in a way that would recognise the new reality, both in Europe and in the world.

From below-ground to above-ground energy

Current ways of using natural resources are unsustainable. In particular, the decrease in the atmosphere's capacity to absorb and process greenhouse gases is most likely leading to a significant warming of the planet, with dire consequences for the life on it [6,15]. A standard of living cannot be maintained without energy, and the developing world cannot be deprived of the same standard that we have. The world will simply have to find a way to help all people achieve a similar quality of life while using less non-renewable energy and finding a way to create almost all energy from renewable resources. This is a revolution, because within about 40 years we will need to replace our current power base and much of the infrastructure that took centuries to build.

The EU can continue to be at the forefront in setting the global political agenda related to climate change measures. It can also get back on track as the technological power that spearheads innovation and grows energy-related industries. The alternative for the future would be that Europe, finding comfort in the fact that it is not the region most afflicted by climate change, builds fences against the climate refugees who are predicted to come from the south.

From a young to a greying society

The EU is facing a major demographic challenge. Its population is expected to peak at around 520 million in 2030 and then drop back to 505 million by 2060 [5]. On average this population will be much older than today's, less optimistic, and less likely to take risks—while globally, the EU will face demographically youthful societies, particularly on its southern and south-eastern borders. By 2025 the EU, even with expected expansions, will comprise only 6.5% of the global population [2]. The fact that human talent will become the main economic resource [4] also gives a perspective on the global share of the EU in tomorrow's world.

The EU can either promote a return to higher birth rates and larger families, encourage people to work longer into what are now retirement years and allow for more immigration—or it can face a severe worsening of the relationship between the working and the supported population.

From an industrial to a conceptual age

Increased efficiency of manufacturing processes, automation and robotics are enabling industry to produce more and more with less and less human work. Markets are saturated with products that consumers—especially those in rich societies with money to spend—hardly need [11]. A significant shift in the economy is taking place in which industrial jobs are being replaced by service jobs; production jobs are replaced by jobs of creating or caring [8]. An increasing share of a product's purchase value is not in the material, energy or labour costs embedded in the product, but in the meaning that a product (or service) evokes in the consumer. Products and services of the future will not only concern basic functions; they will also be well-designed, beautiful, of a known brand with a positive ethical association. The new values will include ‘home-made’, ‘environmentally friendly’, ‘trustworthy’, ‘ethically produced’ and ‘green’ [14,16].

While traditional paths of growth in the developing economies and in poorer segments of the developed ones are possible, the challenge of the developed societies is how to create new needs. Reshaping material needs into symbolic ones is a great challenge for an entire society. Such a change, however, will not only grow new domestic industries but potentially could help save the planet.

The EU can use its rich cultural and ethical capital and reorient its economy towards a creative economy—one that combines science, innovation and creativity to create products and services that are more than what they are useful for. It can maintain its world-class brands and create new ones embedded with our culture and values. Alternatively, the EU can engage in an uphill struggle to maintain an economy built on price and function only.

From paper-based to digital communication

Technological and scientific development today is rapid in all areas. Amazing breakthroughs are occurring in the fields of medicine, biotechnology, nanotechnology, genetics and other new sciences. But no other field has such a pervasive impact on all areas of life as information and communication technology does. It is communication among people that makes a family and enables collaboration in business, science, politics and governance. In the next decades the communication revolution around the Internet will change how people collaborate, learn and work; it will change the mass media and will even have an impact on the kind of democracy and citizen participation that is practised [17]. The rise of information technology is of the scale that the invention of affordable paper and print was a half-millennium ago. The digital world is global. Countries and unions do not exist on the Internet. There are no borders. Everyone is a few clicks away.

As Europe did in the time of Gutenberg, the EU can use the new communication paradigm to expand its creative and innovative base of people; reach to resources abroad; and adapt its education, innovation, economic, social and political systems to take advantage of the new technology. Or it can cherish its memories of the glorious age of paper when European civilisation achieved global dominance.

The global, historic and immediate nature of the disruptions

Some disruptions are long term and historic

The abundance of industrial products signals a historic shift from the industrial economy to a creative post-industrial economy in which information and meaning add most value [18]. The rise of the BRICs (Brazil, Russia, India and China) signals the end of the dominance of the West that lasted some five hundred years. The climate change problem is, after one hundred years, triggering a new energy revolution, this time from below-ground to above-ground energy. Demographic trends are, for the first time in European history, creating a pessimistic old society and raising the question of whether per capita growth is possible without demographic growth. The electronic communications revolution is comparable to a Gutenberg transformation.

Some disruptions are short term and are fuelling the current crisis

Many other disruptions played a part in the current economic crisis. The rise of the BRICs after the end of the Cold War created global imbalances in trade, exchange rates and savings. The financial sector that was at the epicentre of the crisis was responding to the desire of many for a safe old age. Because of the lack of a social security system (as in China), some were saving too much, while in countries with existing social security (as in Europe and the US), some were saving too little. Stock and real estate bubbles were both created by savings that did not go into real investments such as new factories, machines and infrastructures. Because the rich economies failed to introduce a new sustainable model of growth, this is a crisis of Western countries. Very high energy prices and fears of inflation stopped the availability of easy money. The crisis, when it erupted, spread with the speed of the Internet and a depth of panic that only the new media could create.

Other disruptions are global, not European

Except where European demographic realities are shared (as with Japan and China), the demographic disruptions are global. Europe's problems are not global problems any more. The Cold War was the last European war that became a global war. Europe's peace is not global peace. The next few years will determine whether the crisis will revitalise Europe or contain the date that historians will use to mark the beginning of the decline of a great European civilisation.

European strengths

The future will demand an array of tools to be deployed and policies to be created. This section outlines the key principles and assets that the EU has at its disposal which should be guiding its action.

The stability of values

The Lisbon Treaty puts the ‘inviolable and inalienable rights of the human person, freedom, democracy and equality’ at the very top of its list of values. Human beings in their individual creativity, inventiveness and empathy in a free, democratic environment that offers equal opportunities to all are Europe's greatest assets. People who are free to pursue their dreams and make their own success or failure have been giving birth to new ideas for centuries.

Europe should care for people and for nature. This care is manifested through solidarity, sustainability and openness.

Solidarity

Europe must encourage people and companies to take risks. And solidarity with those who have tried but failed will result in more risk-taking and a more competitive society that, in turn, is able to afford this solidarity. Lifting poor citizens and poor Member States out of poverty is not only an act of empathy but also makes economic sense and will create growth.

Sustainability

If Europe's economy is to be sustainable, its practices will be such that it will not have to borrow from the future. Whether it is with our energy resources, water, food, or money, we have to make do with what is available to our generation, not depriving or indebting future generations. Such determination not only ensures that we do not borrow resources from our children or destroy nature; it is also good for development, because we need to invent ways to do more with less. It is an incentive for innovation and progress.

Openness

This value gives the EU a perspective for the future. So far, the European project has been open both to new members and to institutional evolution. It should remain open, however, rather than continuing to invent new treaties; the focus for some time should be on learning to use existing legal and institutional tools rather than on continuing to perfect the tools themselves. The EU should fight enlargement fatigue and make sure that all European states that are willing and able to join also feel wanted. It should resolve the double paradox of Turkey: first, that Turkey is more likely to be secular if it is less democratic; and second, that to keep Europe a Christian club would be to break its promise to Turkey, which is not a very Christian thing to do. A long-term European strategy towards Russia should be based on the fact that Russia has always been a part of European history and that much of what was discussed in the opening paragraphs of the introduction to this paper applies equally to Russia.

The change of temporal and spatial perspectives

Global perspective

Given the global reach of the disruptions described above, the EU must look at the issues from a global perspective. The challenges can only be properly understood when situated in the global context. After more than 50 years of thinking that has been mostly focused on its own continent, the EU must make a Copernican shift in its perspective. The new vision must move Europe away from the centre, but hopefully not out of the picture. When we deal with global issues, our awareness of a common European identity will automatically become stronger, as will the sense that individual Member States are increasingly irrelevant and that a common approach through the EU has potential. The temptation in this context will be for Member States sometimes to act on their own and to use the EU to promote their interests.

Long-termism

The window of opportunity to address the disruptions will soon close. There is a clear need for coherence between short-term responses to the crisis and the addressing of long-term challenges. The added value of the EU could be exactly what is seen as its weakness: its democratic deficit shields it from short-term national politics that focus on the next elections. Brussels can push politics that may be unpopular in the short term but result in what people want in the long term. The possibility of a long-term view is an asset of European institutions and should be developed more formally through an ad hoc institutional structure. This would allow the European Council to perform its specific tasks of stimulating the development of the EU in the long term and helping to define its general political, economic and social priorities.

Resources for the future

To address the global disruptions described above, Europe can draw on three resources that are currently underutilised: the sun, the European Union and the European people.

The Europeans

Well educated, innovative, creative and curious Europeans who are given an opportunity to pursue their interests will be the ones to meet all the challenges. Will we dare to bet on our talent, or would we rather have our civil servants do the planning and redistribute the wealth?

The sun

This will be the source of energy for the ‘third industrial revolution’. Studies [1,3] show that Europe can reduce greenhouse gases by 80% before 2050. Will we dare give up our addiction to cheap fossil fuels?

The European Union

Generations of European politicians have been building the European Union to the stage at which it is now. The EU was built with other problems in mind, but its solid structure will be proven if we address the challenges now. There is a European dimension to the solution to any of the challenges. And out of every previous crisis, the EU emerged stronger, deeper and wider. Will national politicians dare to shift some powers to the EU on the one hand and to the citizens on the other? Will we all have the wisdom to sacrifice short-term popularity for long-term goals?

The Europeans

The EU has enshrined the social market economy in the Lisbon Treaty. It is not just any kind of social market economy; it is a highly competitive one. The competitiveness in the knowledge economy of today and the meaning economy of tomorrow stands and falls with the inventiveness, creativity, culture and values of the people. The most important economic resource is not land, not raw materials, not energy sources, but people. The three key issues associated with people are their numbers, their quality, and the opportunities and empowerment they need.

Numbers

Given the demographic trends, Europe will not have strength in numbers in the future. Numbers matter, however. An average European is not smarter than an average Chinese or Indian, so one cannot expect talent to make up for lack of numbers. The following measures can help to re-establish Europe's competitive edge.

Celebrate life

European civilisation must once more celebrate life, family and children and translate this into family-friendly policies. We need to help each child reach his or her potential—regardless of social status, location of birth and so on—by offering affordable or free education to all, in all phases of life and at a higher quality. We need to make the most out of everyone by building a society that is upwardly mobile both socially and economically, as well as geographically mobile.

Promote Europe as the best location for talent

Immigration policy needs to bring smart people into the EU, allowing them, too, to enjoy free movement. The EU should become the world's best place for talent to flourish, offering attractive schooling, housing, civil infrastructure, creative jobs and entrepreneurial opportunities. It should reverse the trend in which people who emigrate from Europe are better educated than those who immigrate. Internal migration should be eased through the portability of rights for social services and insurance. Similar to the mechanism for creating enterprises at the European level, a new structure should allow the possibility of European citizenship under the so-called twenty-eighth regime. ¹

1

28th regimes are legal frameworks of EU rules which do not replace national rules but are an optional alternative to them (European Commission)

Reform the labour market

All of the preceding measures call for reforms of the labour market, as well as in education and pension legislation. Flexicurity should provide more choice for those seeking jobs and to those hiring, enabling employers to hire the most qualified people. But an even more substantial reform will be needed to address new kinds of work arrangements.

Support schooling and partial retirement

Longer life expectancy and ageing will soon require that pension reforms combine retirement age with life expectancy. This will mean not only an older workforce but also a rethinking of the way a person's life is organised into learning years, work years and retirement. The three phases will be intermixed, requiring a modernisation of the education system, work legislation and retirement policy to allow education and retirement to be woven together with work.

Support new forms of work

‘Going to work’ is an invention of the industrial age. The information age will change formal work arrangements. In the creative economy [18] and the ‘empathic economy’ [13], we will see more people self-employed, working part-time, working in a social enterprise, working in the Internet economy for a virtual employer somewhere in cyberspace. People will barter the results of their work and will spend a substantial part of their time doing pro bono or community services, either in the context of social entrepreneurship or on their own. Work legislation and systems of taxation, social security and insurance should not try to keep the social and economic system of the industrial age; instead, they should allow an increasing part of the workforce to transition smoothly into the new forms.

Quality

Many believe that because we Europeans do not have strength in numbers, we will need to build on good education. The problem is that we are not the only ones who know this trick. Developing countries are systematically investing in quality education and even inventing benchmarks by which to evaluate education (Shanghai Rankings). Europe has a solid foundation to build upon, but famous tradition should not obstruct modernisation.

Prepare for jobs that do not yet exist

Education should prepare students for jobs that do not yet exist while at the same time maintaining the skills needed by industry. We need new types of curricula in a world where any information can be googled and where most learning will happen outside of institutions. Educating for curiosity, creativity, self-learning, unconventional work and critical evaluation will be essential. Education should be for the European real labour market and for the global virtual labour market, not for national markets. Education starts with good teachers. They should become pillars of society, as they were one hundred years ago. But the teachers of the future will not simply transmit knowledge and information; they will develop the talent of their students.

Encourage open education

The diffusion of knowledge and the number of educated people have changed dramatically since the invention of paper and printing, and even more dramatically with the advent of digital media. Institutions of knowledge and learning must therefore become more open to the outside—open to collaboration with industry, the public sector and civil society; open to applicants from other institutions, from other continents and so forth.

Build up autonomous, accountable and competitive universities

The ‘ivory tower’ concept of the traditional European university, with its fine line between autonomy and insularity, needs to change. Autonomy should be matched with accountability for results, and Europe's higher education system should be competitive both internally as well as externally in a global context, for students and faculty.

Empowerment

In summary, when it comes to investing in people, we will not have the numbers but we can cultivate what everybody in the world recognises as important: education and investment in research and development. Where we could have a little edge is in the ways we treat people and the ways we treat talent—according to our culture and our values. We should defend these values, not only out of respect for our tradition but also because it was these values—respect for individuals in their trials and their risk taking—that once set us apart from the rest of the world at the end of the Middle Ages and provided the basis for the subsequent success of Western civilisation.

Recognise that empowerment is more relevant than ever

Never before in history has education been so good and available to so many. Never before have so many had access to so much information and knowledge and to so many other educated people. Never has so much learning occurred outside of schools and universities. Never has so much learning happened after the usual age for school. Never have so much innovation and creativity taken place outside established organisations. Never before has such a small percentage of the educated population worked for the government and in politics. Two hundred years ago most educated people either worked for either the church or the government.

Promote freedom and openness

This leads to two very important messages. First, people need to be free to exercise their talent and put their knowledge to use. There are more reasons than there were in the past for governments to step back, regulate less and referee more, not control society or play nanny to its citizens. Second, institutions—whether companies, universities or other knowledge organisations—and politics should open up and use the knowledge, ideas and talent on the outside, replacing pyramid-like structures with open and collaborative ones. The systems should evolve to embrace open innovation, open universities and open politics.

Use open politics and e-participation to connect the European Union and its empowered citizens

The relationship between the EU and the people referred to by those inside the Brussels bubble as ‘the citizens’ is a major concern of ‘Brussels’. Informing the citizen, making sure he or she cares about the EU and more specifically about the importance and relevance of ‘Brussels’ is the subject of numerous policies, press relation strategies and expensive information campaigns. These traditional approaches are losing the battle for the attention of information consumers. In the age when content is abundant and attention scarce, the attention will return only by engaging the people and letting them contribute and participate meaningfully. The institutions of the European Union should practise e-democracy, openness, transparency and inclusion of citizens, NGOs and ad hoc groups in developing policies. The ‘Agora of Europe’ [10] should function primarily in a digital incarnation.

Improve the empowerment of social and economic models

The social market economy should be highly competitive and should work to separate the market economy from social institutions. Europe should celebrate entrepreneurship and risk taking. In particular, Europe needs a better environment for start-up companies. Instead of focusing on national champions and European monopolies (in one way or the other), the EU and national policies should care about establishing European companies that are global leaders. Startups and global leaders are the most profitable companies but are comparatively the least common in the demography of European businesses [7].

Encourage responsibility among businesses

In the creative economy (see above, under Support new forms of work), value is in the intangible attributes of the products, not in features that can be measured or audited. A key element of a business will be the reputation it has with its consumers. The ethical, social and environmental responsibility of a business will be a vital competitive advantage.

Promote open research, innovation and creativity

Policies should focus on outputs rather than inputs. Research and development spending targets should be replaced by results targets and should fit the structure of the national economy.

The sun

The supply of clean, reliable and affordable energy and of water, food and other commodities will be one of the main challenges in the crowded, warming, globalised world of the first half of the twenty-first century. The challenge can be met by a combination of resource-efficiency measures, reliance on renewable resources and diversification of resources. The following are some actions that Europe can take:

Kick-start a third industrial revolution that will lead to a carbon-neutral Europe

The Union must establish a radically new industrial policy based on resource efficiency and renewable energy, and one that will not be dogmatic about avoiding nuclear energy. This change will be so profound that it could be called an industrial revolution. It is about moving from below-ground to above-ground energy and from centralised to decentralised production of energy. It is also about continuing the uncoupling of economic growth from growth in energy consumption. The ambition of this new policy is global leadership, not only in commitments and goals, but in science, standards, technology and industry.

Lead in sustainability

Europeans must deepen their commitment to protect the planet, including flora, fauna and fellow humans. They must step up efforts to realise their ambition of energy efficiency from 20% by 2020 to 50% by 2030 through a mix of standardisation, price and tax incentives and public and private investments. They must step up their efforts to reduce CO₂ emissions—by 20% in 2020, and then growing to 80% by 2050, taking full advantage of the fact that already by 2030 two-thirds of the energy infrastructure will need replacing anyway. Finally, they should institute a moratorium of investment in carbon-intensive energy facilities.

Establish a single market for energy and a single European energy policy

A European optimum in energy efficiency and decarbonisation of the energy sector is different and better than the sum of national optimums. The EU should establish the technical infrastructure for a common energy market and ensure the reliability of supply and risk-sharing by improving the European energy grid so that it can be the basis for the smart grid of the future. The EU should establish a competitive business and regulatory environment for a common energy market. It should break down national monopolies and unbundle production from the distribution of energy. Through its size as a single purchaser, the EU can establish a ‘customer is king’ atmosphere when negotiating with energy suppliers, both existing (Russia, Middle East, Magreb) and emerging (North African sun). Without truly European solutions, the energy market will be distorted by national champions who will use Member State concerns for security of supply as an excuse for their existence.

Conduct a green tax reform

The EU should reform the taxation systems across the Member States so that the price of a product (domestic or imported) reflects its environmental impact. This taxation should complement the Emissions Trading Scheme and create incentives for consumers to shop for fewer resource-intensive products. Particularly if a global agreement on an emissions cap is not reached, the EU should intensify the carbon-related taxation of products regardless of their origin. This will help prevent carbon leakage and encourage global consumption and production patterns that are less carbon intensive. The temptation to use climate change as an excuse for protectionism should be avoided.

Aim for global leadership in research and development

Europe must give priority to establishing a common, industry-driven research and development policy that promotes energy efficiency and the use of renewable energy, and includes climate studies and geo-engineering. Such a policy should lead to global leadership in selected new technologies and industry standards. It should reflect the ambition, support and exposure similar to that of the Apollo space programme or Manhattan Project. Topics should include next-generation nuclear reactors, clean coal and CCS (carbon capture and storage), smart grid technology and energy storage, photovoltaic technology and flagship projects such as North Sea wind and North African sun. The EU should retain the initiative in the global debate on sustainable development and climate change and consider how to transform this moral leadership into concrete benefits on political, economic or industrial fronts.

The European Union

More EU in Europe

As we have seen, more opportunities for a European Union solution have already been identified in areas such as the common higher education market, common immigration policies and common energy policies.

Protect and deepen the common market for the twentieth century

The common market is the keystone of European integration. Europe stands and falls with it. It has brought progress and prosperity. Considering all the bad press the market economy received during the recent economic crisis, the number one task now is to preserve it. The number two task is to re-launch and deepen it into areas in which it does not yet exist.

The common market has two functions. First, by creating a larger market it improves competitiveness. Second, by giving access to products and services it improves cohesion in the EU and reduces the differences in wealth and development among regions. Political and social rejection of the common market is related to an inability of some enterprises to compete with others without protectionism, market distortions, state aid, social dumping or tax breaks. To deepen the common market all these issues will need to be treated as a package; unfair practices in one area cannot coexist with free and open markets in another.

Create a common market for the new economy

A single European market for intellectual property needs to be established, particularly for the new media and Internet economy. Also, in all other new, high-growth areas where leading-edge science is being commercialised (biotechnology, medicine, genetically modified organisms, nanotechnology and sustainable energy), Europe should create a single regulatory space that would be a basis for a single market of products and services. This would be a good breeding ground for European companies in tomorrow's technology. Affordable European patents and a new approach to intellectual property rights (IPR) should be set up, whose primary goal is not to protect IPR but rather, to offer new incentives for creativity and innovation. Legislation that was created for a material, paper-based world is outdated and inappropriate for the rapid creation and repackaging of knowledge in the information society.

Preserve competition among Member States

Member States must be allowed to compete in the cost-effectiveness of their social services, their organisation and in their ways of collecting taxes. Just as Europe has common standards to prevent environmental dumping, the EU should define a set of minimal standards in the area of health care and social protection in order to prevent social dumping and a decline of living standards. In this framework, poorer Member States must be enabled to use various mechanisms to attract foreign investment. It is a simple truth that more growth can be expected in areas that are currently not so well developed. Asia is a global example of that. It would be foolish not to allow capital to flow in the direction of higher growth. Growth is not a zero-sum game.

Enhance economic coordination

This is a logical requirement of maintaining monetary integration. The recent economic crisis has shown that its mechanisms should be taken much more seriously. In the enforcement of the Stability and Growth Pact the Commission should take advantage of the new provisions in the Lisbon Treaty. The Pact should be extended to include the supervision of private debt and the balance of payments. Because economic coordination calls for measures in the Member States, the European Council should take the lead in shaping coordinated economic policy, and the Commission should oversee it. The coordination of the monetary union should be particularly strong and take place at a prime ministerial level.

More EU in the world

There are several scenarios of how the world will evolve in the next few decades. In the European interest is a multi-polar, orderly world where a body like the G-20 provides some kind of global governance. But this scenario is far from certain and the EU will have to work hard to reach this goal.

Europe as an actor on the global scene

To be a global actor, one needs three W's: wealth, will and wheels. The EU may have the wealth, but it is unclear if it has the will, and it certainly needs the wheels—the power to deliver its will. In some areas Europe has power—for example in ethics, diplomacy, richness of ideas, humanitarian aid, leadership by example—but this is all soft power. Europe clearly lacks a balanced portfolio, including an army, that would make it a smart power. It would only be practical for this army to have a component that is also part of the NATO forces and (should some countries insist) another component that stays outside NATO.

Common external policy

In three ways, the EU's current external policy is not common: (1) Member States do not have a common position; (2) European institutions and their leaders (Parliament, Commission, Council, High Representative of the Union for Foreign Affairs and Security Policy) may not have a common position and it remains unclear who speaks for Europe, and where; and (3) policy sectors speak independently with foreign powers on different topics. Talks on energy policy, climate change, trade, positions in the International Labour Organization, World Trade Organization and the UN are often held independently of each other, making it impossible to solve issues by considering them together, or by getting European interests defended in one area by exerting pressure in another. The first issue will be resolved in time as individual Member States become increasingly irrelevant on the global stage. On the second issue, the European Council should take the initiative. On the third issue, the Commission should take the initiative and break down walls between the sectors.

A common political market

Underlying the European Union is a common economic market. Many other markers or dimensions of integration, however, are missing. One of the most critical gaps is that of a European political market. This creates an asymmetry of reward and punishment and invites a moral hazard among politicians, particularly national ones. Implementing good policies on the European level hardly brings any advantage to the national political market. By contrast, doing things that are bad for Europe and perhaps popular at the national level are punished by no one in Brussels while being rewarded by the home electorate. This will not be stopped by the rhetoric of political will; it can only be stopped if a political market is created at the European level or if the national political markets depend more on actions in Brussels. Political will is created by competition on political market.

Conclusion

The European Union may have a special place in the hearts of people who have first-hand experience of the horrors of the Second World War and of the totalitarian regimes that crumbled at the end of the 1980s. But these generations will be increasingly a minority in the future. Peace, democracy and human rights are taken for granted today. New generations expect the EU to deliver on the practical, day-to-day issues. They may not expect the EU to make history, but they do want it to make life better everywhere; to make other European countries less ‘foreign’ when it comes to studying, working, getting medical help or social services, shopping and, yes, even phoning or using the Internet.

The EU has to deliver to the Europeans by speaking with deeds, not simply with the words of communication strategies. The greatest responsibility for the future of the EU lies with the top national politicians, European politicians and Members of the European Parliament. Either they take ownership of the EU and help it deliver on its undisputed potential to be an actor in the globalised world and on the continent—or their countries will try to paddle through times of relative European decline, each on its own, pretending that the struggles or power and prestige among them still matter in the world.