Will the Treaty of Rome’s 60th birthday be its last?

2017 will mark the 60^th anniversary of the signing of the Treaty of Rome, widely regarded as the foundation stone in the movement towards greater political and economic union that has become known as the ‘European project.’ Yet, in contrast to the triumphalist tone of the 50^th anniversary celebrations, next year’s commemorations are likely to be austere, nostalgic and hesitant – in tune with the mood of the times.

In 2007, the EU could look back on half a century of uninterrupted march towards ever closer union, with an ever greater number of countries – including those of the former socialist camp – partaking in the project, and ever deeper links between them. Not only had the Rome agreement ushered in the longest period of peace in modern European history; it had also fostered widely shared prosperity through the free movement of goods, capital and people. The advent of the single currency in 2002 was expected to only hasten economic convergence and accelerate growth.

Today, such optimism looks as foolish as Nikita Khrushchev’s 1956 admonition that the Soviet Union would soon “bury” the West. The past ten years have seen a deep financial crash which brought European treasuries, from Dublin to Lisbon and Madrid to Athens, to their knees, in turn threatening the survival of the euro. Whilst there is general agreement that the worst of the economic downturn is over, most of Europe is growing at snail’s pace, unemployment – especially among the young – remains very high, and a sense of impending political crisis – because of Brexit, Greece, Italy, Marine Le Pen, Middle East refugees, Putin, Trump (take your pick) – persists.

Whereas in 2007 the EU could look forward to the future with confidence of brighter days to come, as 2016 closes it is not outlandish to suggest that European integration may be past its high-water mark. Departure from the Union is no longer taboo. The refugee crisis has alienated eastern European member states, whilst in southern Europe economic stagnation is blamed on the euro. Even in France, Germany and the Netherlands, who were among the six original signatories of the Treaty of Rome, there is frustration with the EU’s undemocratic decision-making, the European Central Bank’s low interest rates, and the globalisation and cosmopolitanism that the European project is believed to represent.

There are four ways that the EU could go from here.

There could be a disorderly unravelling, prompted by an economic or political shock – a banking crisis in Italy, or the election of Le Pen in France’s upcoming presidential election – which proved beyond the ability of political elites to resolve. I would put the likelihood of a chaotic break-up at 20 per cent. Then there could be a decisive move towards greater centralisation, involving the creation of a common European treasury with debt-issuing powers and fiscal transfers, as well as a single cabinet with – at a minimum – foreign policy, defence and border control as its competences. I would also give such an impulse towards a federal Europe a 20 per cent likelihood.

The most plausible scenario – to which I would assign a 40 per cent probability – is an orderly dismantling of EU structures. This would involve the gradual renationalisation of most regulatory powers currently vested in the European Commission, effectively abolishing the Single Market. It would also likely entail the reintroduction of national monies, with one or two transitional phases like when the euro was introduced – only in reverse. There would be an end to free movement, which is increasingly unsustainable politically, but free trade in capital, goods and some services would endure. Note that this process could simultaneously see a few competences – such as joint defence capabilities and frontier management – transferred upwards to a multinational body. But on net, pan-European institutions would be vastly curbed.

The fourth possibility is what is commonly described as “muddling on” – leaving the existing division of powers largely unchanged, due to a lack of consensus about the way forward or fears about the unintended consequences of any push for fundamental reform. Again, I would give this scenario a 20 per cent probability, but of course this will always be a temporary state of affairs. Sooner or later, outside events will force the EU’s hand.

To pro-European liberals and internationally minded Christians, the set of possible scenarios which has opened up poses a challenge. The priority is no longer to advocate for values such as subsidiarity, human dignity and voluntary cooperation within the edifice of the EU, but to ensure that, however the future shapes up, those principles will be at the heart of European relations. It will involve preserving the best parts of the EU – peace, commerce, toleration and a sense of common purpose – whilst being ready to address its flaws – bureaucratic centralisation, indifference to local concerns and an imperviousness to economic and political innovation.

Luckily, one of the enduring positive legacies of the European project is a blurring of national divisions and the sort of cultural homogenisation – through years of study and work abroad, foreign holidays, and the learning of languages – which makes conflict less likely. Unlike the years preceding World War I, when nationally conscious publics had grown in number and power under the nose of a cosmopolitan elite, today the reach of Europeanism is broader and deeper. But that should not breed complacency: all it takes for a civilisation to be led into darkness is for good people to abdicate their responsibility. It will fall to them to determine whether, fifty years from now, Europe will celebrate continued peace and prosperity or commemorate tragedy.

Diego Zuluaga is a Research Fellow at the Institute of Economic Affairs, the UK’s leading free-market think tank. He has written on a range of economic issues, including competition policy in the innovative industries, the deregulation of taxi markets, and the taxation of capital.