Europe's Economic Future: Ghosts Return

The outcome of the referendums on the Constitutional Treaty in France and the Netherlands, even if widely expected, has prompted a great deal of soul-searching. Why did people so massively reject building a more integrated Europe? And, most of all, why did this happen in countries traditionally strong supporters of the project? Is British-style euroscepticism infecting the continent? Europe is clearly at a crossroads and opposition to the treaty provides an excellent opportunity, to engage the public and politicians in dialogue on reform. Europe needs to talk through a roadmap and vision for the twenty-first century. Most of all it must communicate effectively with all its people; the alternatives are not attractive.

The World Today
3 minute READ

Dr Paola Subacchi

Former Research Director, International Economics

Behind the French and Dutch rejection of the Constitutional Treaty there is much broader discontent on several fronts. First it was a ‘No’ to the single market and the management of the economy. It reflected deep disappointment that economic integration has not delivered the expected results and has resulted in more constraints and red tape.

The ‘No’ also expressed rejection of the so-called Anglo- Saxon model which continental Europeans tend to describe as a ‘free market without a safety net’. But it is hard to find a real example of this, Britain certainly does not fit, since it has over two million people on incapacity benefit. However the European social model mainly works for those who are part of the labour market yet about ten percent of working-age people in the euro area are unemployed and do not enjoy access to these benefits.

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