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reflections

Apr 25, 2016 | 21:39 GMT

6 mins read

In Europe, a Crisis in Every Direction

(JOE KLAMAR/AFP/Getty Images)
It can be difficult to separate the important from unimportant on any given day. Reflections mean to do exactly that — by thinking about what happened today, we can consider what might happen tomorrow.

During the early stages of the EU crisis, most threats to the survival of the Continental bloc came from its periphery. Back then the prevailing fear was that financial disaster in a southern member state — a default in Greece or Portugal, for example — could precipitate the eurozone's collapse, hurting northern nations such as Germany and the Netherlands in the process. Though the possibility still exists, a sort of inverse threat has emerged. Today, the steady rise of anti-establishment and Euroskeptic sentiments in Northern Europe, as exemplified in Austria and Germany, threatens the Continent's south.

In Austria's first round of presidential elections, held April 24, voters demonstrated the extent of their dissatisfaction with traditional parties. For the first time since the early 1950s, the country's president will not be a member of the traditional center-left Social Democrats or the conservative People's Party. Instead, candidates from the nationalist Freedom Party and Green Party, having received over 36 percent and roughly 20 percent of the vote, respectively, will face off in the May 22 runoff election. Although the president's role is mostly ceremonial, the vote nevertheless sends a clear signal to Vienna's moderate government.

A broad movement toward nationalism in Austrian politics would have an impact on several EU issues, including the migration crisis and bailouts for troubled eurozone members. Austria is one of the countries most affected by Europe's migration crisis: Statistics indicate that in 2015, asylum applications exceeded births in the country. So far, in response to the rise in immigration, Vienna has implemented several controversial unilateral measures, closing its border with Slovenia, introducing a quota on asylum applications and threatening to introduce controls at its border with Italy. Now, considering the recent success of the anti-immigration Freedom Party, the administration in Vienna may take a cue to continue toughening its position. If Austria's traditional parties feel that the Freedom Party's strong electoral showings jeopardize their own prospects — especially as they prepare for a 2018 general election — they might try to adopt a more nationalist agenda as well.

Italy is among the countries most worried by this trend, fearing that Vienna may close the borders with its southern neighbor in response to popular demands. This would sever one of the main migration routes between Italy and Northern Europe, which could, in turn, lead stranded migrants to camp at the Italian-Austrian border. Moreover, border closures, and even controls, would hurt bilateral trade and compound traffic congestion in one of Europe's most transited regions.

Greece, too, would feel the effects of a Euroskeptic Austrian government. Athens is currently trying to convince its fellow Schengen Agreement signatories that its efforts to protect the European Union's external borders are sufficient. To that end, Athens will present new plans for improved border controls to the EU Commission this week. If the plans are not well received, Greece could be suspended from the Schengen zone. At the same time, Greece is negotiating with its creditors to determine the reforms it must implement to receive its next tranche of bailout money and the contingency measures it will have to introduce if it fails to meet fiscal targets by 2018. As a member of Schengen and the eurozone, Austria will have a say on both issues. And pressures at home could force Vienna to take a tougher stance toward its southern colleague.

Beyond the implications for Southern Europe, Austria's political developments are notable for their relative similarity to Germany's. Opinion polls there show that the two largest German parties, the center-right Christian Democratic Union and the center-left Social Democratic Party, are losing ground to less moderate factions. The nationalist Alternative for Germany (AfD) party, for instance, is currently polling at around 14 percent.

AfD emerged as a collection of university professors and journalists critical of the eurozone, but soon evolved into an anti-immigration party. Chancellor Angela Merkel's open-door refugee policy was a boon for AfD, which saw its popular support double in a few months. But as the migrant flow into Germany has slowed, Alternative for Germany has sought additional ways to attract and maintain the Euroskeptic and nationalist vote. In an interview published April 24 in Frankfurt's Allgemeine Zeitung newspaper, Jorg Meuthen, a prominent AfD member, suggested a return to the party's roots. Meuthen argued that France and other Southern European countries should be excluded from the eurozone for their unwillingness to reform.

Among German political parties, Alternative for Germany is not alone in questioning the eurozone. Along with a large segment of its population, Germany's government is concerned about potential fallout in the country's financial sector from the European Central Bank's expansionary monetary policies. Both the center-right and the center-left have criticized the ECB, and German newspapers regularly discuss the bank's strategies. In early April, German Finance Minister Wolfgang Schaeuble allegedly blamed the ECB for the spike in AfD's popularity. Ironically, in expressing their own disapproval, the mainstream, pro-European parties affirm AfD's position.

Furthermore, Meuthen's statements reveal AfD's desire to weaken Europe's core political and economic partnership, the alliance between Germany and France. But for French nationalists, at least, AfD's idea may not seem like a bad one. France's National Front is equally skeptical of the euro, claiming that it has damaged France's economy and undermined its sovereignty. In fact, the party has promised to put eurozone membership to a referendum vote if it wins the 2017 presidential election. For its part, AfD recently announced that it would seek greater cooperation with like-minded parties. Mutual distaste for the eurozone, albeit for different reasons, could bring the two parties together.

The Euroskeptic trend poses a threat not only to the future of Southern Europe, but also to that of the Continental bloc as a whole. Surging nationalist sentiment could lead Northern European governments to isolate themselves from the south, closing borders or deciding that the eurozone would fare better without its problematic members. For now, Euroskepticism is much stronger in Austria, a wealthy but relatively small country with limited influence over EU affairs. Though a Euroskeptic Austria could make life more difficult for Southern Europe, it probably would not represent a systemic challenge for the European Union. Conversely, a Euroskeptic Germany could freeze or even reverse the process of Continental integration.

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