Never mind the euro.

Never mind the euro.

Never mind the euro.

Events beyond our borders.
Jan. 7 2002 12:33 PM

Small Change

Never mind the euro—the European superstate arrived years ago.

Clinkety-clink-clink: I jingled the new euro coins in my hand, briefly wondering if, as the Times of London had warned, their high nickel content would give me eczema. But because my first encounter with the new European currency took place in a gloomy, ill-lit transfer lounge of the Frankfurt airport at some ghastly hour of a jet-lagged morning, I thought no more about it for a few days. I waited, instead, for the flood of commentary to tell me what to think—but I waited in vain.

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Or rather, I waited in vain for someone to say something original. There are many strange things about the euro, the new Pan-European currency that finally went into circulation Jan. 1, but nothing is stranger than the sense of intellectual exhaustion that surrounds the whole project. The European Central Bank itself dates the genesis of the euro back to 1957, and it is perfectly fair to say that the pro-euro and anti-euro camps have been fighting about the idea ever since. In the first week of January, all those arguments were simply repeated. The French and German presses (click here for Slate's summary) smugly celebrated the potential economic gains, which are indeed great: Companies will no longer have to deal in different currencies, cross-border investment will likely increase, price comparisons will be easier, and tourists will no longer come home with those unwanted, unchangeable foreign coins in their pockets. Over time, the euro will be able to compete with the dollar as a currency of choice in places like Russia, where $20 billion is said to circulate in used U.S. banknotes. True enough, but I've heard it all before.

By contrast, the euro-skeptic British press—Britain, like Denmark and Sweden, has not joined the euro—mocked the new banknotes for their boring design and warned that they herald the coming of an Orwellian Euro-superstate. In America, George Will picked up precisely the same themes—boring banknotes, soulless future superstate—as well as the undemocratic nature of the European bureaucracy that now effectively dictates most of the policy for much of the continent. I've heard these arguments many times before too—I note for the record that some were even expressed in Slate as long ago as 1997—and have even written them myself.

But with mostly positive arguments about economic efficiency on one side, and mostly negative aesthetic and political arguments on the other, all the commentators seem to miss the enormity of what has already happened. Most of all, the negative commentators failed to notice that the euro does not herald the coming of a superstate; on the contrary, for almost all practical purposes, the superstate arrived long ago. Foreign and military policy are still, it is true, largely made by individual countries: Faced with foreign crises (Bosnia, Sept. 11) Europe has proved extremely bad at coming up with ways to deal with them.

Nevertheless, an extremely high percentage of European legislation already originates not in domestic parliaments but in Brussels. European monetary policy has in fact been coordinated by the European Central Bank since 1999. Europeans who don't like their own countries' legal systems can already take their cases to a European Court of Justice, and thousands do. Moves to coordinate European fiscal policy are afoot, and I have no doubt they will succeed. Before long, there will be a unified European tax system, just as there is already a unified European regulatory system, a unified European environmental policy, and unified European labor standards.

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The superstate is already here, in other words—and it isn't Orwellian at all. Orwell's dystopia was ruled by terror; Europe's governing principle, by contrast, is indifference. In Germany, where opinion polls consistently showed a majority opposed to the adoption of the euro, there was no public protest when it was finally brought in. In France, where quite blatant forms of nationalism are still publicly acceptable, no one blinked when the franc, a major symbol of national sovereignty, disappeared forever.

Even in Britain, where Euro-skepticism is still an acceptable mainstream position, the conservative leader William Hague fell flat on his face last year when he tried to run a political campaign based on opposition to joining the euro. Yes, the British are against it. No, they don't care enough to do anything about it. Many of the euro's critics have accurately described the European currency as a project cooked up by European elites and then foisted on an unwilling European public. True enough—but this doesn't explain the extraordinary passivity with which the unwilling public quietly accepted this state of affairs.

In my view, Europe's lack of interest in its own national identity proves, once again, something that Americans have come to learn in the past few months: National sovereignty matters only when it matters. Important national symbols (as opposed to soccer teams and Olympic athletes) only make a difference to people in times of crisis. It took the collapse of the World Trade Center to remind Americans of how much they need the CIA. It took the war in Afghanistan to remind Americans of how much we depend on our smart bombs, products of our military research. In times of peace, by contrast, both U.S. intelligence and the Pentagon's research budget are fair game for critics of all kinds.

I suspect the same will prove true in Europe. National sovereignty will matter when it matters. That is, Italy's or France's inability to control their own monetary policy, and eventually their own tax policies and their own security policies, will matter only when the Italians and the French feel themselves to be in crisis: when Europe's inflexible labor market produces huge imbalances across the continent, when galloping inflation in one country is matched by intractable recession in another, or even when terrorist bombs start exploding in Rome and Paris, and the Italian and French governments find that they no longer have independent police forces capable of fighting back. For their sake, and ours, I hope it won't be too late.