Europe needs sweeping reform to work. More free trade to create jobs and growth, more transparency and a stronger democratic mandate from the peoples of Europe are necessary to counteract the surge in ultranationalists and fringeparties. Without these reforms the union will wither.
To work for a more sustainable EU I am engaged in Open Europe, the leading think tank in Europe right now on European reform, with offices in London, Berlin and Brussels.
Things have been rough lately in Europe.
A strong recession combined with the Eurozone crisis has highlighted what many suspected all along; there are problems in how the monetary union was built and operates. More than half of all regulatory costs that businesses carry stem from laws made in Brussels. Over a quarter of young people are without a job, creating a looming social tragedy. It is the time to evaluate what Europe is doing for job creation, entrepreneurship and growth.
To what extent does it help unleash the power of entrepreneurship?
To what extent does it not?
So the debate in Europe is growing, and sometimes it is very polarizing.
Is Brussels on one hand, a sclerotic monster, not up to scratch in the global race, threatening to engulf the nation state? Or is it, on the other hand, the very bridge that will prevent a repeat of the monstrous conflicts of last century?
A third way of looking at Europe would be more modern and pragmatic. Looking for ways to reform the EU, so that it can deliver what voters and businesses actually ask for.
Let’s just state this; the basic ideas behind the EU – of trade, peace and free movement of people, capital and goods – create fantastic opportunities for entrepreneurs, small and large. London is right now acting much a like a capital of Europe, attracting talent and treasure from all over the world.
If the UK was to leave the union, this could change.
Most opinion polls in the UK show that a majority of both citizens and business want to stay in a reformed, slimmed down EU, rather than to leave it altogether. Yes, Brussels can be frustrating, but paradoxically, the EU is also ripe for reform.
The euro-zone crisis has dampened the appetite for supercalifragilisticexpialidocious mega-state experiments, to paraphrase Mary Poppins. Though the Eurozone itself, reluctantly, is heading for more common decision-making, more and more EU leaders are coming around to the view that the only way to make Europe work, is reform it.
This is what I would like to see:
- Strengthen democracy! Just as entrepreneurs create a licence to operate by keeping a close eye on customer needs, the EU needs a stronger democratic mandate. Decisions should be taken closer to citizens affected. National parliaments should have the power to block EU regulation that is seen as harming the country and its businesses. The perks and benefits of EU civil servants need to be cut.
- Make Europe grow! Just as competitive businesses always try to focus on core competences and the unique selling point, the EU should focus hard on doing what it does best: trade. Regulation must be cut to free up businesses to create growth and jobs. More trade deals will add billions to the European economies, while creating growth opportunities for the developing world. A properly liberalised services market could, according to an Open Europe study, provide a 2 % boost to annual GDP growth in all member states.
- Make Europe cost-effective! Just as businesses must see over cost structures regularly, so should the EU. The inflated budget must be dramatically reformed. It is in very few Europeans interest that some 40% of the budget is spent on agricultural projects, in many cases regardless of whether there’s any actual farming involved. The huge sums spent on redistribution between regions of rich countries have to be cut or reallocated to investments in the future, such as funding basic and applied sciences.
Read more: openeurope.org.uk