1. The coalition of 27 countries into the European Union is one of the great
innovations of the past few centuries. Of course those in the EU recognize
many, short-term problems and disappointments. But these are secondary.
The main point is that 27 countries have each agreed to sacrifice some autonomy
and have made great progress in creating the most important economy
on the earth, meanwhile making general war on the European subcontinent
unthinkable in the future. And they have done this while retaining some
special European values, not just by copying the model of the United States.
2. The conditions that have facilitated the successful union of these countries
will disappear over the next few decades; the challenge now is to adapt
the implementation strategy, so thatmomentum towards unification can nevertheless
be preserved under new conditions.
- One important foundation for the unification was the horrible memory
of European war and the resolve that never again would the countries of
Europe enter into a total effort to destroy each other. But the generation that
experienced the war and feared its repetition is dying off. The new generation
is more concerned about its living standard.
- A second important foundation for the unification was general economic
growth. It has been possible for some countries to transfer a small part
of their wealth to others and still let their own citizens have more each year.
It was possible for the new members to justify giving up some sovereignty,
since that would permit their citizens to be better off. But the end of cheap energy
and favorable environment will force a period of declining discretionary
income on the nations of Europe (and the rest of the world). Nations transferring
resources to others will need to sustain political support for that in a
period when their own citizens have less each year than they did before.
3. So the questions addressed by the conference will be easy to answer –
just watch how the members of the EU approach the issues of climate change
and oil depletion. If the 27 members retain cohesion, develop, and implement
common strategies, even though those strategies disadvantage some countries over
the short term, the EU has a grand future. If, in contrast, countries
abandon the EU policies in an effort to improve their own short-term
prospects, the EU will become much less effective. It will continue to exist in
theory, but its bodies and laws will grow increasingly irrelevant.
4. So far the EU has only addressed issues related to climate change. On
the surface, the Union has maintained its cohesion on this issue. However
The reference year for CO2 emissions was coincident with the collapse of industry
(therefore of energy use and CO2 emissions) in the USSR and central
European nations in 1989 – 1990. The EU members have claimed they are
making progress on the Kyoto goals and retained their unity by taking credit
for this one-time reduction. But the goals indicated in the recent Vienna meeting
will not be met through this artifice. Reducing green house gas emissions
by 25 to 40 percent below 1990 levels by 2020 is possible. (It is also urgently
important.) And achieving that goal would have enormous long-term economic
and political benefits. But in the short term it will require enormous
investments, changes in policy, reduction in some important sectors of the
economy, and shifts in the competitive position of different countries. It is
not certain that the EU can maintain its unity throughout the many years of
this process.
5. The EU has not so far directly addressed issues related to declining oil
production. It has adopted important goals for increased use of renewable
energy, but those goals mainly came from concern about the environment.
Climate change is obviously a global problem. No one country can imagine
to solve its own climate problems through unilateral action. While energy
scarcity is, in fact, a global problem, it will be easy for some countries to
imagine that they can solve, or reduce, their own short-term energy problems
by unilateral action. One example is Germany’s efforts to develop a special
relation with Russia on matters related to gas supply.
So the key indicator signalling the fate of the future of the European Union
will be in the evolution of the EU response to growing recognition that oil
production is going to decline and oil prices (political and economic) will
rise, at least for the remainder of this century. Of course I have no way to
know if the EU will succeed or fail in developing a common energy strategy
that will be effective in the period of declining oil. I hope it will succeed.
The easiest way to form your own opinion is to monitor the activities of the
Energy Charter.
The EU did play a major role in the Energy Charter Initiative, started in
the early 1990s, and it has signed the protocol. But Russia has not signed.
So the Charter provides a useful arena within which to observe evolving
energy policies.
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