Who Can Put Europe's Humpty Dumpty Together Again?

It should be the moment of triumph for European Community chief Jacques Delors. By finally ratifying the Maastricht Treaty on European union on May 18, Denmark's voters have all but assured that Britain, Europe's last holdout, will also sign on. But just as Delors' master plan for Europe is falling into place, it is looking increasingly obsolete.

When EC leaders unveiled the unity treaty in the Dutch town of Maastricht in late 1991, they promoted it as the blueprint for a post-cold war Europe. A unified monetary system, planned for the end of the decade, was to help transform Europe into an economic superpower to rival Japan and North America. There seemed to be no stopping the EC, which expected to draw in new member states, from Scandinavia to Eastern Europe, and gradually to displace the U.S. as the Continent's defender.

Now, the window for putting such an ambitious plan in place has closed. Europe's political leaders are fumbling everything from implementing Europe's single market to the debacle of the former Yugoslavia. And recession and rising unemployment have made it nearly suicidal for governments to stay on course for a monetary union built on German-style financial discipline. "There's no doubt that a completely new agenda has to be prepared with a more realistic timetable," says Unilever Chairman Michael S. Perry.

But post-Maastricht Europe will turn out to be a far more ad hoc affair than originally envisioned. With political union now a distant dream, the growing clout of Europe's regional economic areas will further erode Brussels' role as Continental maestro. While a smaller, de facto monetary union may yet emerge in northern Europe, it will be dominated by the German Bundesbank. In fact, without a strong EC, Germany is likely to call the economic tune on the Continent. That will cause others, particularly the French, to worry about its unchecked power.

There is little sign of pro-unity forces regaining the initiative anytime soon. If anything, European disunion is growing. While the EC gave Denmark the right to opt out of both monetary union and a common defense policy in order to get voters on board, Danish opponents of Maastricht still greeted its approval with rioting. Although Britain will likely ratify Maastricht, opposition there runs deep. Even France, a core EC country, is foot-dragging on dismantling border controls because of fears of immigration and cross-border crime. New aspirants to the EC, such as Austria and Sweden, are getting queasy and will be more likely to insist on their own special deals in return for joining the fold.

SURVIVAL. In Brussels, the bitter process of getting Maastricht ratified has all but paralyzed the EC bureaucracy. Delors' effectiveness has dwindled as Maastricht has floundered. Pressure from France for him to abandon Brussels for a run in the French presidential elections in 1995 has made him seem like a lame duck at the EC.

No one is filling the leadership vacuum. One might think, for instance, that European leaders would move to shore up the fledgling democracies on their eastern flank. But with the EC economy projected to shrink by as much as 1% this year, pressure is building instead to close EC markets to countries such as Poland and Hungary. While such moves may seem incredibly shortsighted, politicians are a lot more worried about their own political survival than they are about acting like statesmen. That is why Europe is likely to witness a lot more parochialism than grand vision for the next couple of years.

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