The Next Superpower? The Rise of Europe and Its Challenge to the United States
September 13, 2005

Former U.S. Representative to the European Union Rockwell Schnabel wrote The Next Superpower after learning that 75% of Americans were ignorant of what the EU actually is. Schnabel penned this compendium with co-author Francis X. Rocca on what the EU is, where it is going, and its ever-growing importance to the U.S. Contrasting today's Europe with the continent in ruins at the end of World War II, the Dutch-born Schnabel praised the EU as a "monument to political success." However, a new European crisis has arisen, precipitated by this summer's failed referenda on the Constitutional Treaty, a document misunderstood by the voters, who, in France, used their ballots to send a message about economic conditions. Ever the entrepreneur, the former banker and venture capitalist saw in this predicament opportunity, specifically for economic reform, and observed that the current British, French, German prime ministers and chancellors, on some level, each seem to agree.

Schnabel lauded the goals of the European social model, but noted that not even the European youth believe it will deliver for them in the future. He pointed to the "less protective but more innovative" economies of Ireland, Eastern Europe, and the Nordic states as models for economic growth and competitiveness. Although the rise of India and China make the need for reforms obvious, Schnabel acknowledged the challenges Europe's unique history and culture present in enacting them. In the end, however, he was optimistic that Europe would "not only survive, but flourish," and the U.S. must continue to take notice.

Stuart Eizenstat of Covington & Burling, formerly Deputy Secretary of Treasury, a Wilson Center Public Policy Scholar, and, like Schnabel, U.S. ambassador to the EU, praised The Next Superpower, agreeing that although the EU is one of the least understood institutions by Americans, it is one of the most important to U.S. national security. It is developing a more cohesive foreign policy through its colossal foreign aid budget, its work in Iran and the Middle East, and by voting as a bloc at international organizations. The EU serves as the "single most important magnet for democracy in the world," with the very prospect of membership spurring relatively swift economic, political, and legal reforms in Spain, Greece, Portugal, Eastern Europe, and now Turkey. The rift over Iraq brought to the surface longstanding cultural, military, and political differences between the U.S. and Europe, but Schnabel, highlighting the significance of President Bush's recent first trip to Brussels, the seat of the EU, was optimistic for improved transatlantic relations. The U.S. continues to support EU integration and enlargement and is working with the EU3 on Iran and Syria, and the world's most important relationship continues to thrive. To strengthen these bonds, Eizenstat promoted a "New Atlantic Charter," advocating a fully integrated EU-U.S. marketplace, more private sector exchange, and further cooperation on issues from the environment to terrorism.

Martin Walker, the Editor of UPI and also a former Public Policy Scholar at the Wilson Center, remarked that at one point after the diplomatic spectacle leading up to the Iraq invasion, continued U.S. commitment to the project of Europe, a feature of U.S. foreign policy for five decades, was in doubt, but thankfully was salvaged due "in large part to Schnabel's work." Walker also noted the power of the world's "biggest, fattest, single market," as the regulations any global company must follow are, in the words of GE's CEO, "increasingly set in Brussels." The American public has little understanding of this concept, and for that reason, Schnabel's book (whose proceeds are donated to a State Department award fund) is an "indispensable guide."

But Europe is more than a market, although Walker noted it has not yet decided exactly what it will be or what its geographical or constitutional limits are (certainly no United States of Europe, at least for a generation). He traced much of its problems to demographics, as native Europeans have "virtually stopped breeding," yielding a birthrate (1.35) falling far short of the 2.1 needed to sustain a population. Therefore, foreign policy is hobbled as voters of single-child families flinch at the prospect of any military action, economic growth is threatened, and social cohesion is imperiled as the immigrant population surges (the current most popular name in Amsterdam is now "Muhammad"). And, as Schnabel remarked during the Q&A, herein lies a paradox, as the U.S.'s success at assimilating immigrants and creating a broad American identity is tied to the economic opportunities that exist in a high growth economy. Schnabel noted that it took him 1.5 hours to find a job after emigrating to the U.S., yet thousands of immigrants in Europe are absorbed not into their new country's culture, but the welfare system.

During the discussion, the speakers qualified what kind of superpower the EU would become. Ambassador Eizenstat observed that as the U.S. seeks again, out of pragmatism, for a true partner on Iran, Israel, etc., the EU, ironically, might be too weakened or distracted by its new internal and structural crises to respond. Martin Walker warned the audience not to expect an "all-singing, all-dancing, all-fronts, cultural, military, economic, technical superpower" like the U.S., since Europe eyes American military might and reasons, "Why keep a dog and bark yourself?"