THE WARSAW INSTITUTE REVIEW

Date: 18 May 2020

The virus will change the EU, but not how we might expect

The COVID-19 pandemic reached all European Union countries, changing the landscape not only of individual countries and their economies, but also of the entire Community. Professor Tomasz Grzegorz Grosse, in an interviewed by Izabela Wojtyczka, Editor-in-Chief of The Warsaw Institute Review, elaborates on the fight against the virus in Europe, its economic effects, the condition of the EU, and ultimately, changes on the geopolitical chessboard.

GERMAN MINISTER OF FINANCE OLAF SCHOLZ AND PRESIDENT OF EUROPEAN CENTRAL BANK CHRISTINE LAGARDE. BRUSSELS, BELGIUM, FEBRUARY 17, 2020

Izabela Wojtyczka: For several weeks now, we all have been watching closely the European Union’s reaction to the SARS-CoV-2 virus, which at present is still raging in Europe. How do you assess the Community’s actions?

Tomasz Grzegorz Grosse: European institutions were busy with the migration crisis on the Turkish-Greek border, while in the European Union the pandemic was developing at its most intensive rate. For this reason, it would seem that the EU “missed” the first phase of the crisis, allowing the Member States to act on their own. In general, it was not decisively helping, but also it was not interrupting the national authorities, who are the most responsible for tackling the crisis. The only issue that ought to be definitely be assessed in a negative light is the European Commission’s call to keep national borders open when they should have been closed in order to limit the movement of people infected in the first phase of the pandemic.

In the next phase of the crisis, the EU should focus on supporting the Member States facing the crisis. In part, this has already begun taking shape. Most notably, the European Commission channelled financial means for vaccine research, organised joint tenders for medical equipment, made strides to popularise good practices in combating the pandemic, as well as having loosened internal market and public procurement rules. Additionally, it sought to develop financial instruments to counter the health crisis and the impending economic recession. All this should be listed on the plus side of the EU institutions’ actions undertaken.

What is negative is the Commission’s attempts to impose universal ways of exiting the crisis and to interfere in the internal affairs of the Member States. On this occasion, it turned out – again – that the EU institutions are applying double standards in relation to Central European countries, where, for instance, some practices are being criticised in Hungary and not noticed in France. Moreover, it would seem that the European Commission has likely abandoned in its entirety the ethos of ‘apoliticality’ and impartiality. During the crisis, it was even more distinctly subject to national influences, and even divided internally according to national interests. An example attesting to this was the public support for the idea of “corona bonds” by the French and Italian commissioners, contrary to the official position of their German superior.

In some EU countries, especially where the virus takes its heaviest toll, people talk about great disappointment with the European Union. Once we have dealt with the coronavirus situation, could we expect more rhetoric orbital around countries potentially considering to leave the Community? Increasingly critical voices are coming even from Germany, which speaks openly about the lack of solidarity in the face of such a serious pandemic…

THE PRESIDENT OF EUROPEAN COMMISSION URSULA VON DER LEYEN HOLDS A PRESS CONFERENCE ON THE EUROPEAN UNION RESPONSE TO THE CORONAVIRUS COVID-19. SOURCE: JOHN THYS (PAP/EPA)

Not only Italians and Spaniards, but other nations of Southern Europe and Western Europe are also increasingly bitter and disappointed with European integration. In recent years, their countries have become the scene of successive crises in which, according to the majority of Italians for example, the European Union abandoned them, or worse, even handicapped their efforts, rather than helping in overcoming their difficulties. Of course, a counter-argument could suggest that it is not farfetched to assume that the expectations of Italian society towards European integration are too high. And this could help deduce a conclusion which Poland would do well to draw from this observation. It is not a solution to jump in head-first into the deep end and speed up integration, through means such as entering the monetary union to state an example, and to do these with sole focus to get them done as soon as possible, rather than doing them responsibly. Poles should understand that it is necessary to build their own strong state with strategic instruments of coordinating action in order to effectively respond to various crises in the future. One should not excessively rely on the EU for a disproportionate array of elements, because this can only lead to disappointment on all sides.

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As such, in my opinion, it is necessary to support actions of the EU which distinctly strengthen the EU’s subsidiarity and can be used by all Member States, especially those in the most need. But at the same time, it ought to be underlined that Western European partners should be more respectful of our interests and preferences with regard to European integration, without coercively imposing their specific visions of the EU on us.

We have to be also prepared for further problems and disintegration processes in the western part of the continent. Therefore, regional cooperation, i.e. within Central Europe, should be even more important for us than in any other stage prior. We should present our position together to the partners from the western part of the EU, rather than remaining declarative to each other, because then there is a chance that we will be heard.

At the end of January this year, French President Emanuel Macron called for a European revival. Meanwhile, we can see that Italians are already receiving “help” from Russia, and Hungarians are cooperating with China. Which vision of the EU suffered the most due to the coronavirus pandemic? Is it possible to frequently find articles mentioning the weakness of Eurocrats? What is the condition of the European “superstate” today?

Considering all these factors, one could argue that the European Union should fundamentally change its integration model. Above all, it should certainly not interfere in the competences of nation states, e.g. under the pretext of protecting European values and the rule of law, and make a clear distinction when this is the case. Moreover, it should not interfere in the electoral policy of the member states, for example, by supporting the opposition against the legally elected authorities, i.e. in effect, what could seem like actually seeking to change the government if it has slightly different views on the EU agenda from the EU bureaucrats or the strongest member states. The EU has been greatly appropriated by the particular interests of the largest countries, which is visible in the preference for Macron or Merkel’s proposals and blatantly ignoring most of the political ideas coming from Warsaw. Another problem is the excessive centralisation of power in Brussels, including the CJEU, which is pushing the Union towards a federation against the opinion of many European states and nations.

The EU should be a support, not a substitute for the member states. And the strongest in the EU should not use the EU institutions and law to subordinate smaller states. Centralisation and federalisation of the EU system enhance the asymmetry of interests between the largest and smaller states. Therefore, Poland should oppose the federalisation tendencies, both in the fiscal sphere, for example by blocking the establishment of EU taxes, as well as legal federalism by defending the prioritised legitimacy of the national constitution over CJEU rulings.

A period of crises should encourage support for weaker states or those in trouble, but the price of assistance should not be the imposition of political conditions favourable to the stronger states and difficult to accept for those in need. As a result, the concept of solidarity is devalued and citizens are discouraged. In turn, the external forces that benefit are those which aim to weaken European integration and even to lead to its total failure. But the integration leaders themselves are seemingly actually heading towards this failure because they are guided almost exclusively by their own interests, treating other EU countries as rivals or unruly children.

EUROPEAN COMMISSION HEADQUARTERS IN BRUSSELS, BELGIUM, APRIL 1, 2020. SOURCE: OLIVIER HOSLET (PAP)

You have already mentioned the important role of nation states in the first phase of the crisis. Taking into account subsequent events, will European integration be overshadowed by the strategy of strong nation states? Or perhaps might this be the case only in some areas of state activity?

Answering this requires that I underline, as mentioned, that the main role in the EU is played by the largest states, which are primarily guided by their own national interests. In a crisis, they are the most responsible, especially with regard to financial programmes supporting the weaker EU members. In this way, they can show solidarity and responsibility for the future of integration.

The problem is not only that the resources of even the richest countries are limited and taxpayers are reluctant to share their own funds with other nations in a crisis. The problem is that the economic crisis affects the monetary union, which is incomplete. Existing instruments may not be sufficient for this project to continue and additional redistributive instruments such as “corona bonds” may be a fiscal burden too heavy for the richest countries, thus risking their credibility and the credibility of the monetary union as a whole. The monetary union is trapped and is a huge burden and risk to European integration.

What kind of risk would that be?

The monetary union forces the federalisation and centralisation of the EU system, as well as a ‘two-speed Europe’. All this is very unfavourable for the Polish state. On the other hand, the Eurozone is in a difficult situation and is actually struggling to survive. For Poland, it is crucial to stay away from the problems of the monetary union as far as possible and, at the same time, to demand from Western European countries to treat Poland and other countries not belonging to the Eurozone as partners and to respect their subjectivity.

Today, when almost all EU economies are in effect temporarily dormant, we are almost certain that difficult years are coming, and that a recession-orientated crisis is approaching. What can we expect? What will Europe look like in the coming years? Which branches of the economy will suffer most? What would be the scale of the crisis?

Though analysts and institutions across many spectrums are trying to figure this out, there seems to be a general consensus that there is unfortunately potential that the crisis can be painful and long-lasting. It will affect everyone, but probably smaller companies will suffer the most. We do not know how foreign companies, whose strategies are decided on outside our borders, will behave. In the crisis, the public sector, which can provide jobs, will be particularly important, as well as state-owned and other domestic companies. The key is the government’s strategy for emerging from the crisis, which should be an opportunity to change the profile of the economy.

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On the one hand, it is about laying the foundations for strategic national companies, perhaps controlled or at least with the participation of the state treasury, in sectors important for national security – in its broadest sense, i.e. health, energy, technology, arms, etc. On the other hand, the crisis is an opportunity to change the profile of the economy towards services, especially electronic and high-tech based, preferably in our national “intelligent” specialities.

And on the geopolitical chessboard – what reshuffling can we expect? How will the seemingly weakened United States behave? And what about the existing alliances or political formats, such as the Three Seas Initiative?

China will strive to benefit geopolitically from the crisis whilst Russia and Western Europe will probably find their positions de facto weakened. The crisis will not lead to the “spinal fracture” of the Americans. We must remember that they have high technology, one of the best medical laboratories and leading corporations in this sector. Therefore, they have the resources to find a cure for the virus relatively quickly even in the face of high mortality rates. The crisis may even strengthen Donald Trump’s strategy. First of all, it will force the US economy to become independent from China and its reindustrialisation. It will even partly fulfil the president’s hope of “separating” the US economy from China.

However, transatlantic relations may suffer in the crisis, but this would be a greater loss for Europe than for the US. In such a situation the Americans should not leave Europe, but rather confidently look for allies there. That is why I believe they can continue to support the Three Seas Initiative and closer integration within Central Europe. The interests of China in this region are exactly the same. Regardless of the policies of both powers, Poland’s interest is also to cooperate in this region. The crisis is an opportunity to show solidarity with our “brothers” and neighbours, both in dealing with the coronavirus and with not always justified allegations made by our partners from the western part of the EU.

It can be read in various sources that the communist authorities in Beijing failed to inform the world about the virus which has been spreading in Wuhan since November 2019, concealed facts about the threat and today, is “offering” commercial “help” to the world. How would you comment on China’s participation in the whole situation? What, in your opinion, should be the Polish and the EU strategy in relations with China?

As many of us, I have no additional knowledge about the origins of the epidemic to the already widely available information which shows that the Chinese authorities neglected the threat and understated data about the victims. This could result from the internal policy of the communist party. However, it should also be noted that China offered help to many EU countries, including Poland, and that our government is buying medical supplies from China. We should also remember that the Middle Kingdom is already one of the greatest powers, and its position is constantly growing.

Moreover, a possibility sometimes overlooked, in specific circumstances, it may also be a partner to Poland in the situation of a possible threat from the Russian Federation. The challenge for Poland is to arrange economic relations with this giant which would be as beneficial as possible for our country, to derive wealth and technology, but certainly not to become dependent, which threatens us at least in some sectors. The second challenge is the growing tension between the US, our strategic ally, and the Middle Kingdom. Finally, the last challenge is the growing investment, migration and political involvement of China in Central Europe. We should consider how to solve the basic problems related to these three challenges with the benefit for national interests. But I am far from interfering in China’s domestic policy, mainly because I expect exactly the same from our EU allies.

Yet in February, when the virus was already spreading in Europe, the European Commission was also engaged, except for the mentioned migration policy, in a discussion about the rule of law in Poland. Was this concern right? How can this be explained?

In Poland, there is an ongoing discussion between governmental groups and the opposition about judicial reform, and whether it is compatible with the Polish Constitution. This problem cannot and should not be resolved by the EU institutions in any way. It is not within their competences to examine the compliance of reforms in the Member States with the local constitution. The EU interferes in the reform, which is essentially a competence of a Member State and gives rise to a sharp internal dispute. Such external interference will always be risky – benign and desirable for part of society, and discouraging the idea of integration for the others. Especially in a nation like Poland, which is over-sensitive with regard to its own sovereignty because it has been taught by history that its neighbours have repeatedly used internal disputes of Poles for their own benefit. This is why thinkers who have been considering integration projects in Europe since the 17th century have often stressed the iron principle –  the sovereignty of individual nations should be respected and their internal affairs should not be interfered with. This is what William Penn thought at the end of the 17th century, Abbot of Saint-Pierre, who proposed something of a European Union in the early 18th century. Immanuel Kant and many others also thought of integration in the same way.

  What will change irreversibly in the EU landscape once the pandemic is contained?

It is difficult to augur, but a pandemic will certainly lead to many tensions on the international scene. All the hidden problems, discords and grudges will likely explode with new force. Therefore, it will be a major challenge for the EU to protect itself from disintegration. Both in the world and Europe, absent a clear change in trajectory, I expect diminishing some respect for international organisations and international law. With this, one can also expect a tendency of individual states and nations to seek security firstly on their own as it will no longer be possible to fully trust either globalisation, European institutions or even allies. This may, paradoxically, strengthen those states that would have previously had trusted in overly liberal ideas and made themselves almost defenceless in the face of further crises.

Countries will have to rebuild the infrastructure that is necessary in times of crisis, such as border protection, health care, telecommunications, including postal services, etc. They will have to focus more on some hitherto neglected public policies, such as industry, health, but also migration. The presence of the state in the economy will probably increase, especially in those sectors which play a strategic role in security. The EU will have to adapt to these grassroots trends, or it will experience another crisis, this time caused by the disobedience of part of the Member States. This is why I believe that the solution for the EU in such a situation is providing greater flexibility of action, less centralised management and generally greater freedom left to the Member States. The EU will probably have to abandon, at least for a while,  the vision of building a centralised super-state and adopt a more subsidiary attitude towards nation states and their democracies.

This article was originally published on The Warsaw Institute Review.

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