Immobile Europe

We often hear that the Eurozone is not what we might call an optimal monetary union, and this is true. Prices and salaries are too inflexible, productivity and competitiveness vary too much from one country to the next, national economic policies are an effective obstacle to progress, and Brussels is unable to provide help to those who really need it.

But can a monetary union really be optimal? Small European countries – and all European countries are small, including those that have not realised it yet – are plagued by regional imbalances that are to some extent alleviated by [wealth] transfers and subsidies from Brussels. If this was not the case, how could the North and the South of Italy remain united? How could Flemmings and Walloons continue to move forward together? How could Norrland [Northern Sweden] survive without Stockholm?

Dynamic labour market

The European debt crisis has also ruthlessly exposed the weakness of the euro. And there is no doubt that nation states and their accompanying histories and cultural traditions have made this an insoluble problem. The European community claims to be a "union" whereas it has much more in common with what is classically called a confederation – a political model that history has always shown to be dysfunctional.

What does not work in Europe, however, does work in a federation like the United States. And one reason for this is the fundamental parameter of labour mobility. Naturally behind this euphemism, there are events in lives like yours and mine. For several years, I lived in East Virginia.

It was and is a particularly rich and prosperous region of the United States, but you only had to travel a few kilometres down the road to West Virgina to find areas that had been totally abandoned. Everyone had left to seek work elsewhere. You may not like it, but that is what a dynamic labour market looks like.

Mobility is frightening

We won’t budge! When I was young, that was the slogan the Norrland rebels chanted in protest at the lack of jobs, which were – as they still are — more plentiful in the South. Unfortunately, this is a typically European reaction. In France, Polish plumbers who had a mind to go against this rule were accused of stealing bread from French tables. For the average European citizen, moving to a place where there is work is tantamount to surrendering to a demeaning constraint, while public authorities worry about depopulation.

At best, European workers seek jobs abroad for limited periods, and when this is the case, they usually intend to return to their home countries, where they build houses, which, if all goes well, future generations will inherit. Houses that are strong enough to resist storms and floods, unlike the ramshackle constructions that they call houses in the United States, which are the price of this mobility that is so lacking in Europe.

In Virginia, I met with farmers who were stunned when I asked them for how many generations their land had belonged to their families. For them, land was simply a business like any other. Many of them had already owned farms in three or four different places in the United States, where they had raised beef cattle, or grown corn or oilseeds. The concept of a family estate was completely alien to them. And that is precisely the type of mobility that Europeans find so frightening, it gives them vertigo.

Linguistic cacophony

Of course, most of us do not work the land anymore. But we have forgotten the millions and millions of Europeans who not so long ago packed their bags to emigrate to the United States, most of whom never returned. The Chinese, the Indians and the Americans (in their respective countries) continue to exemplify this approach to mobility. But my impression is that this level of pragmatism is completely alien to most Europeans.

The Eurozone will now have to become a fully fledged supernational federation, led by Germany — the country that won the war by losing it. If that does not happen, the Eurozone will break up into fragments, heralding a new era of re-nationalisation. Neither of these options is particularly desirable, but I find the second much more frightening than the first.

The trouble is that we are not sufficiently mobile to exercise the first option. And that is without mentioning the linguistic cacophony, which, more than anything else, keeps us in our home countries. I have a Croatian neighbour with a construction business, who currently employs Romanian workers on his projects. He tells me they are great guys, hardworking and highly skilled. However, the problem is that they do not understand what he says, nor does he understand what they say to him.