International Workshop – Rome, December 1-2, 2016

Meeting jointly organized by the Aspen Initiative for Europe and Aspen Institute Italia.

A BRIEF OVERVIEW OF THE DISCUSSION

Though each European country has its own political cycles, as well as its own specific economic characteristics, there are objectively a number of common political trends, worrying because of their impact on policy decisions. The main danger is of a vicious cycle of political and economic instability, against the backdrop of widespread mistrust of both national and international institutions. Of course, Donald Trump’s election confirms the great dissatisfaction felt by voters in all the advanced economies, whose overall effects are still difficult to assess. The familiar underlying problems affecting the European economy remain unresolved: the debt (both public and private,) weak banking systems, divergence even within the Eurozone, major imbalances which some experts believe require so-called “symmetrical” adjustments (between countries in deficit and those in surplus,) slow growth, and unemployment. All this is happening within a demographic context unfavorable to innovation.

On the positive side, the mechanisms for managing potential shocks are better than a few years ago and the approaches to structural reforms are now broadly shared (beyond short term considerations) There is also a broad consensus on the need to focus efforts on national policies: the prime responsibility for many reforms lies with individual governments. Nevertheless, there is still a strong tension between the collective requirements of the EU economies (with their related common rules) and the specific interests of Germany, the strongest player, central to any course correction.

There are further sources instability on the way from the United States: the prospect of expansive fiscal policies is particularly worrying to countries with large debts, while the appreciation of the dollar, possibly combined with increased energy prices, would hamper Europe’s growth prospects, causing a possible return to inflation, in its worst possible form – “imported” inflation.

A complex mixture of economic and political variables will also determine the future of trade agreements, which are now often seen as reflecting the inexorable forces of globalization rather than as the means of managing their effects and providing some forms of protection. The repercussions of Brexit, which cannot yet be accurately assessed, add to the continent’s uncertainty, though they are at least forcing policymakers and experts to be more creative.

European migration policies have long suffered from a nonstrategic approach, which has been almost entirely defensive and crisis-driven. It is clear now that domestic and international measures must be integrated in various spheres of action and must take account of relations with difficult partners – starting with Turkey. The lack of a long-term vision makes it almost impossible to maintain costly forms of intervention, even when they move in the right direction, as exemplified by Germany’s choices vis-à-vis the influx of Syrian refugees. Solutions that may generically be defined as “populist” – however vague the term – are short-sighted and deliberately give priority to the narrow interests of a single community. Such an attitude clearly does not facilitate European cooperation, even between governments. Certain issues relating to the sense of “identity” need to be tackled openly. However, it will be difficult to maintain sufficient European cohesion if the prevailing policy is in practice nationalist – not just national – and shifts the burden of the most intensive flows to neighboring countries, particularly those geographically most exposed. Indeed, the latest frictions among EU members over other issues, chiefly economic, complicate the coordinated measures needed to improve the management of the migration crisis and its serious effects on society and security.

Beyond these acute humanitarian crises, it is global economic disparities that cause migration, and these will clearly not be eliminated by policies to control borders or routes. What are needed are long-term measures in the fields of economic cooperation and sociopolitical development in parts of the world suffering from demographic pressure. Thought must also be given to creating legal channels to facilitate certain flows, which almost all European countries need, for economic and demographic reasons. This fact has been virtually forgotten amid the political climate of recent years, but it depends on relations with the regions of origin – to a large extent not North Africa or the Middle East but sub-Saharan Africa and parts of Asia.

Libya’s specific importance as a transit point for a large proportion of these flows has become clearer to all Europeans, though joint action to secure Libya’s ports and borders is diplomatically and practically very difficult under present conditions.

European defense is still a controversial concept, but a number of steps forward have been taken, with the adoption of the Global Strategy in June 2016 and the awareness that almost all the major international security challenges require close intra-European cooperation. There is also a greater awareness that only a greater specifically European capability can safeguard solid transatlantic relations, at a time when the United States is less willing to spend disproportionate sums on its allies’ defense. NATO’s future will also be directly affected by whatever pragmatic agreements can be reached with the United Kingdom. Indeed, the Alliance is all the more important in view of the difficulties on the trade front, with the large question marking hanging over the future of TTIP.

Nor must it be forgotten that NATO has for decades also been the core of an international order based on Western values and rules: this entire system is now being called into question, both by the natural change in global balances and by the weakening of transatlantic ties. The implications for Europe are particularly serious, since the whole of the European edifice rests on a “legal” and institutional vision of interstate relations and of society.

Two aspects will be crucial to the development of more effective security and defense policies: large investments (partly in joint projects, wherever possible) and swifter and more flexible decisionmaking mechanisms (to limit veto rights).

Relations with Russia will be an initial test of the new Euro-American relationship under the Trump presidency. The Europeans must carefully assess the undesired effects of economic sanctions, which have strengthened the Russian public’s nationalist tendencies while objectively causing Vladimir Putin’s government substantial costs.

The numerous unresolved issues in the Mediterranean and Middle Eastern region require the European governments’ constant attention, partly because in some instances responsibility for regional security is falling increasingly on Europe. Social and political trends on the southern shore remain as dangerous as they were before 2011, with the outbreak of the “Arab revolts” that highlighted instabilities but failed to overcome them. Economic inequalities and the demographic challenge – with large numbers of young people lacking prospects in their own countries – are crucial factors in the region’s future. While governments’ responses are almost always inadequate, civil societies are week, which makes it difficult to establish fruitful and solid relations with the northern shore, outside official channels.

Be that as it may, every Arab country must find its own dynamic balance between change (with real observance of civil rights) and sufficient stability (to guarantee basic security and a suitable environment for investments). Policy on education and the family is crucial to establishing a positive approach to gradual change. This will facilitate cooperative management of the challenges of unemployment, innovation and mobilization, migration, and fundamentalist terrorism. Economic reforms must also seek to reduce the burden of welfare systems, improving their quality, but focusing them on the most vulnerable sectors of the population.

Many of the negative stereotypes that exist between the two shores of the Mediterranean can be tackled by long-term exchange programs, mainly involving the younger generations. One example is the approach pursued by the Stevens Initiative, managed by the Aspen Institute – a multilateral public-private partnership designed to expand individual exchanges between youngsters in the United States and the Mediterranean and Middle Eastern region. Eventually the goal is to create an outright “trans-Mediterranean generation” that shares a number of fundamental values and embraces diversity as a positive rather than a negative feature.