Bert Rürup and Michael Hüther in the podcast

Would a two-speed Europe be a political option? Bert Rürup asks this question in the podcast. The problem: The total economic output of the USA is around 25 trillion US dollars, that of China around 18 trillion US dollars and that of the EU around 17 trillion US dollars. Nevertheless, the EU is geopolitically a dwarf.

There are three reasons for this from Rürup’s point of view. First: the eastward enlargement. Where there used to be barbed wire and trenches, there is now a deep ideological trench – namely in the EU. For the new members, national statehood is a symbol of liberation from the Soviet Union. This is seen less strongly in the older EU members.

Secondly, the economic promises associated with the introduction of the euro have not been fulfilled. Heterogeneity has increased and this currency is still not popular in some countries. And thirdly, Rürup observes an estrangement between Germany and France. Both countries were once the engine of the European Union, but now they are not.

The aim should be for Europe to speak with one voice. That Europe plays an important role in the geopolitical and global economic concert. That Europe does not present itself as a more or less divided community, or at least one that does not act in unison. In a bipolar world, Europe, currently the third-strongest player economically, is speechless, says Rürup.

Michael Huether agrees. The question, he adds, is: have the conditions improved for becoming able to speak? He sees his proposal for a defense and investment union as a lever to change that. The threat has seriously intensified, as shown by the almost completed NATO accession of Sweden and Finland.

It is Germany and France that must now act as the driving force behind unification. However, German politics in Brussels is not particularly beneficial. The dispute over an exception for e-fuels was historically unique – promoted by the FDP. The result: a few weeks later, the French would have done exactly the same thing on a different topic.

Hüther says: “We also have to think carefully about what contribution we are making to Europe’s dysfunctionality. And this government is no better than the previous one.” His message: if Europe is not taken seriously in Berlin, what should Warsaw and Budapest think about it?

>> The HRI economic forecast can be found here.

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