Juncker – the anti-eu gift that keeps on giving

The EC President’s dream of a super-state is alive and well, but in reality the union is as divided as ever

For British Eurosceptics, Jeanclaude Juncker is the gift that keeps on giving. In his state of the union address this week, the European Commission President warned that Britain would soon regret its decision to leave the EU, but then went on to outline a series of ambitions for the bloc that would give even the most avid of Remainers pause for thought.

I count myself a fairly typical Remain voter in having no great love for either the idea or practice of the European Union, but a belief that on balance Britain’s interests would have been best served by staying in and fighting our corner.

What I definitely did not vote for was Mr Juncker’s vision of a European super-state; I did not vote for a European army, or for a European finance ministry; I did not vote for a further deepening of centralised decision-making and I certainly did not vote for the forced march of all European states into European Monetary Union. Call me naive if you like; this was always the EU’S purpose, my Eurosceptic friends tell me. But it’s not just me. I doubt Mr Juncker speaks for the average European either. Marke Rutte, the Dutch Prime Minister, said of Mr Juncker’s speech: “We all have our own style and in politics I am not such a romantic. I am more of a: ‘when you have visions, go see a doctor’ kind of guy”.

Yet now rid of the awkward squad – the UK – this is the vision Mr Juncker feels free to pursue. We are thus faced with the very nightmare that hundreds of years of British foreign policy has spent fighting – the creation of an all-powerful hegemon on our very own doorstep.

A hope expressed by at least one prominent Leave campaigner during the referendum debate was that Brexit would inspire similar “democratic rebellions” across Europe. This hasn’t so far happened. To the contrary, with a recovering economy and Emmanuel Macron’s triumph in the French presidential election, the political and economic forces of disintegration have receded. There’s a renewed selfconfidence, which seems, oddly in some respects, to have been bolstered by the British exit. Far from seeing Brexit as a warning, Juncker and others have drawn the opposite conclusion; they plan to go deeper into the very things Britain has rejected.

That self-confidence stretches even to prospects for monetary union, an endeavour which on any objective analysis must be deemed the most calamitous experiment in economic policy-making of the modern age. To Mr Juncker, on the other hand, it is evidence of European destiny and determination. They wrote it off as a “pipe dream”, Mr Juncker told European MPS, yet now it is a “reality” – as if its mere survival fully vindicates its disastrous consequences. For Mr Juncker, the goal is worth the sacrifice.

So let’s briefly consider what those costs have been. For much of southern Europe, monetary union turbocharged an economic collapse which makes the Great Depression look almost trivial by comparison. Unemployment, particularly among the young, has soared to levels never experienced in the developed world, forcing many to up sticks and seek work in colder, northern climes. In the round, Italy has experienced almost no economic growth at all since joining the euro nearly 20 years ago. Such a long hiatus in economic progress is almost unprecedented for any economy, let alone one as large, inventive and proud as Italy’s.

There are many things the EU has got wrong in its pursuit of regulatory harmonisation and economic integration, but they are all second order compared to this devastating, macro-economic mistake.

There is none the less nothing like an economic recovery to help people forget their troubles. Like an incoming tide it eventually submerges the shipwrecks of the rocky shoreline. But it doesn’t solve the underlying problem, and despite Mr Juncker’s ambitions, there is little appetite among northern European electorates for the measures necessary to complete the job and make the euro into a well-functioning currency. Germany won’t even agree to common deposit insurance, a prerequisite for any meaningful banking union, let alone the deeper fiscal, or transfer, union southern states are urging.

Fundamentally, Europe remains as divided as ever. One half thinks monetary union cannot survive without debt-sharing, the other that it surely won’t survive if there is debt-sharing, such would be the political push-back. The euro has weathered its first crisis, but without reconciliation, it will surely go down in the next.

Britain is leaving the EU not just because, unlike locked-in members of the euro, it still can, but because it has looked at Juncker’s prescription for the future and concluded it cannot be part of the further integration necessary to make the euro work. Monetary union can in this sense reasonably be thought the root cause of Brexit. My guess is that, despite the apparent lull in Europe’s storm, the euro will remain as much a force for division and disintegration as for the ever closer union it is meant to bring about.