BERLIN/MUMBAI–The announcement last week that India was entering into exclusive negotiations with Dassault for its Rafale fighter jet represents a major coup for the French defense contractor and for Nicolas Sarkozy. The embattled French president was evidently relieved by the prospect of the Rafale’s first ever foreign sale in a deal worth over US$10 billion, telling reporters, “we have been waiting for this day for 30 years.” The announcement is also a blow for the Eurofighter consortium, consisting of the leading aerospace manufacturers in Germany, Britain, Italy, and Spain, whose Typhoon had been the Rafale’s chief competitor. Two other recent decisions have gone against the Eurofighter group, with Switzerland opting instead for Saab’s Gripen and Japan for Lockheed Martin’s F-35. However, Eurofighter had thought itself better positioned in the Indian competition. It believed it was offering the technically superior aircraft and, indeed, the Typhoon had performed better in competitive trials in 2010.

Of course, defense sales are about much more than technical specifications, with considerations related to costs, technological transfers, joint production opportunities, and political relations playing vitally important roles. Indian observers had long discussed the higher up-front costs of the Eurofighter, but calculated over the total life cycle, the relative differences would not have been too significant. Cost is therefore unlikely to have been the sole rationale for the decision. One can only imagine that Dassault’s offers on technology transfers and joint production must have been generous. Yet Cassidian, the EADS subsidiary that led on the Eurofighter bid, had only last year signaled its commitment to India by opening the country’s first foreign-operated defense-oriented engineering center. Politically, the prospect of a sole partner in France should have been outweighed by relations with the four Eurofighter partner nations, although Indian officials may have calculated that a single partner would be easier to hold accountable than a coalition.

Where there was a real difference between the Dassault and Eurofighter bids was in the nature and scale of political support each received. The French government is comfortable with providing support for its arms export industries in ways that Germany—the lead nation on this Eurofighter bid—is not. In Germany, the idea of coordinating one’s defense, finance, and foreign ministries to support a major defense bid through the establishment of a “war room,” as Sarkozy did, is simply unimaginable. If nothing else, such top-down political support makes it easier to bundle incentives. The sale was also a clear priority for the French president, and given the Rafale’s non-existent record of exports and uncertain future, finding a foreign buyer for the aircraft had become a declared world-wide mission for Sarkozy.

These are trying times for Europe’s defense aerospace companies, with European spending on defense falling by about €24 billion in the past three years alone whilst the global marketplace is also becoming increasingly crowded. The sight of Eurofighter and Dassault competing for overseas sales is a further reminder of the complexities surrounding the ongoing attempt to pool and share Europe’s defense-industrial capabilities, efforts that should be finding new momentum in these times of austerity. Europe’s governments and industries know that between the Rafale, Typhoon, and Gripen, they have produced two more variants of fighter aircraft than they actually need. Such legacy programs  place a further  unnecessary burden on Europe’s shrinking defense budgets and constrain European militaries from effectively configuring their resources to meet evolving requirements. Worse, it is entirely unclear whether any lessons have been learned. The same national imperatives and industrial concerns are now in danger of driving the expensive development of two medium-altitude long-endurance unmanned aerial vehicles (MALE UAVs), Talarion and Telemos. The development of unmanned capabilities may well be the future for defense aerospace, but few in Europe think that two versions of a MALE UAV are really necessary. Fewer still think that Europe won’t end up with two anyway.

Sarah Raine is a non-resident fellow with the German Marshall Fund of the United States (GMF) in Berlin and a consulting research fellow with IISS. Dhruva Jaishankar is a program officer with GMF’s Asia Program in Washington.

WARSAW / WASHINGTON – For hundreds of years, Poland suffered from an overbearing Germany that trampled on the rights of the Polish nation, occupied the country, and, at times, worked to extinguish the Polish nation-state entirely. No wonder that there is a residue of skepticism and caution in Poland when it comes to relations with its big neighbor to the west. A healthy distance and dose of hedging have long been the default position of the country’s foreign policy. Poland’s accession to the European Union has changed all that. Nearly eight years on, Poland is rephrasing its German question, and in a baffling way: how close is too close?

Last week, Poland consented to a European agreement that it did not like in the interest of keeping the continent together. European leaders had agreed on a fiscal compact, a treaty aimed at strengthening the fiscal discipline in the EU countries that choose to sign it, and set governing rules for the eurozone. Prime Minister Donald Tusk faced an uncomfortable choice. On one hand, Poland has declared itself a staunchly pro-European country. In his now-famous Berlin speech last year, Polish Foreign Minister Radek Sikorski spoke of the need for a strong, united, and even federal union. On the other hand, the eurozone was potentially moving ahead without Poland. The plan shaping up ahead of the summit called for meetings of the 17 eurozone countries, excluding Poland from what is seen in Warsaw as a vital decision-making body of a changing EU. Consequently, Tusk threatened Poland might not sign the treaty if this mechanism was not changed.

In Warsaw, eurozone summits are not simply seen as a crisis management mechanism for the euro, but as a nucleus of a smaller club in which most of the key decisions for the EU are made, some in areas beyond the single currency. France is the most active proponent of eurozone-only solutions, and a zero-sum game between France and Poland has developed around the question of a two-speed Europe. Warsaw fears that France wants to undo the EU’s eastern enlargement. Seen from Warsaw, inclusion is a core national interest; Poland did not join the European Union only to find itself sidelined.

The other eurozone members faced a dilemma of their own. No democratic theory stipulates that nonmembers ought to have voting rights in membership organizations. Since voting rights for nonmembers are out of the question, the group considered the PNV principle — “participate, not vote.” But even speaking rights would give nonmembers the opportunity to influence, and maybe even undermine, goals that member states deem essential to sustaining their common currency. Nonmembers should not benefit from the currency union while not contributing to it, and nonmembers should have an incentive to join. But strict exclusion of nonmembers is in nobody’s interest. Some nonmembers are really “not-yet-members.” They are, like Poland, candidate countries working to qualify and waiting for the right moment to join. They have a right to know what’s going on in the club they are aspiring to join. The more the eurozone coordinates to save its currency, the more it will make decisions that affect all 27 EU members. They might pertain to competitiveness, social systems, and taxes.

Keeping Poland in the cold is least of all in Germany’s interest. Poland is the most pro-European country outside the eurozone. Why alienate it? Last weekend, Germany got a taste of what that might mean when Sikorski warned that Germany should not even try to aspire to be a benevolent hegemon. Poland is Germany’s crucial ally for a more federal Europe and a power to help balance the less ambitious Brits and the more confederate French. Poland is essential in order to lead Central and Eastern Europe towards the eurozone and prevent Europe from splitting in two. It has rarely had a more central role in Europe and has never been a more pivotal partner of Germany.

In true European fashion, this led to a compromise, albeit an ugly one. The agreement allows non-eurozone countries to take part in the eurozone summits at least once a year, and whenever issues of competitiveness or the architecture of the eurozone are discussed. Additionally, Herman Van Rompoy, president of the European Council, assured that any summit of the euro 17 will be preceded by a meeting of all EU 27 member states.

An unhappy Tusk contends the agreement still establishes a decision-making format in which Poland does not have a vote, and frequently will not even be present at the deliberations. Nonetheless, Poland decided to join the other 24 signatories (the U.K. and the Czech Republic were the holdouts), marking yet another time that Poland chose “more Europe” when presented with a choice. The Europe Poland is choosing is less and less to its liking, but it is easier to influence the club from the inside than from the outside.

Despite a building relationship with Germany, Warsaw’s support of Berlin’s leadership in Europe is anything but unconditional: “Provided you [Germany] will include us in decision-making, Poland will support you,” Sikorski emphasized in his Berlin speech. Poland knows that it cannot always count on the unwavering support from its western neighbor, especially if Germany had to choose between Poland and France. Tusk’s goal now is to broaden Poland’s alliances within the eurozone, starting with Spain and Italy. Germany will have to earn Poland’s support.

Michal Baranowski  is the Senior Program Officer for Foreign Policy and Civil Society in the German Marshall Fund’s Warsaw office. Thomas Kleine-Brockhoff is a Senior Fellow and Senior Director for Strategy at GMF’s Washington, DC office.

WASHINGTON–Mitt Romney, one of the leading Republican U.S. Presidential candidates, has informed his countrymen over the past few weeks that U.S. President Barack Obama is working to turn the United States into Europe. This, one might think, is good news. Presumably it suggests that a unified “West” is closer to becoming a reality. The president, someone in Washington D.C., is working for ever greater convergence in the world’s greatest alliance. After decades of unabashed Americanization of Europe, it seems, the tables are turning. In due time, the need for transatlantic learning and knowledge transfer between friends and partners will be obsolete. We will all be one happy family.

Indeed, from the perspective of a Republican presidential candidate there is much to like about Europe these days. After all, Europe is largely run by fellow conservatives. They preach and (increasingly) practice fiscal responsibility and structural reform to fix the ills of the continent — a strategy candidate Romney calls on President Obama to embrace.

Let’s pause right here and stop fantasizing. The reality is quite different. Yes, Mitt Romney sees the United States as being transformed into another version of Europe. But in Romney’s eyes that’s no compliment, rather it’s an insult. Romney contends that under Obama, a “European-style welfare state” is America’s destiny. Or, in another version of this horrific vision that permeates most of the candidate’s campaign speeches, “a European-style entitlement society.” Obama, according to Romney, “takes his inspiration from the capitals of Europe; we look to the cities and small towns of America.” Learning from Europe seems to “poison the very spirit of America.” Fellow Republican candidate Rick Santorum agrees, claiming that Obama is “trying to impose some sort of European socialism on the United States.” Not to be outdone, candidate Newt Gingrich, in his South Carolina victory speech on Saturday night, detected the emergence of a “brand new, secular European-style bureaucratic socialism” in America.

So, why are the Republican presidential candidates running against Europe rather than against each other? Why is Europe a dirty word in this campaign? First of all, the vilification of Europe is not a new phenomenon in U.S. politics. Remember the “cheese-eating surrender monkeys”? That epithet, common during the debate about the intervention in Iraq in 2003, referred to the French, for whom the worst abuse is traditionally reserved. The French, often linked with the Germans to form an alliance of “Euroweenies,” chose to sit out the war against Iraq’s weapons of mass destruction and were thus scolded for having lost their “moral compass.” That incident happened barely ten years ago, but one might go back hundreds of years and still detect the same type of argument about Europe. As Princeton historian Linda Colley has pointed out, Americans have traditionally understood their history, culture, and identity in contrast to Europe’s. The United States was founded as the antidote to Europe. The old continent was “the other,” against which to define oneself. The history of immigration helped to entrench the view that one side of the Atlantic was intrinsically better and more blessed than the other. European decadence was replaced by “authentic Americanism.” Europe, as described by the novels of Henry James, was both corrupt and corrupting. “America was a country of innocence, virtue, happiness, and liberty as against a Europe of vice, ignorance, misery, and tyranny,” writes historian C. Vann Woodward. Thus, it was anti-Europeanism that reinforced the new idea of U.S. exceptionalism.

Initially, Anti-Europeanism has risen in combination with an inferiority complex vis-a-vis the supposedly culturally superior Europeans. Certainly, World War II and Europe’s inability to solve its own problems at that time cured Americans of any sense of humility. Since the Cold War, anti-Europeanism has by no means been a U.S. obsession. It has come and gone in waves and has only established itself as a staple of the intellectual life of one wing of U.S. conservatism, just as its sibling, European anti-Americanism, found its home mostly on the political left. The Eurobashers on the U.S. right use a few standard leitmotifs to make their case against the “EU-nuchs” whose “values and spines have dissolved in a lukewarm bath of multilateral, transnational, secular, and postmodern fudge,” to quote the ironic characterization of writer Timothy Garton Ash. At times, anti-Europeanism can be quite funny, especially when skillfully expressed by George W. Bush who famously said: “The problem with the French is that they don’t have a word for entrepreneur.”

The question is how seriously to take all of this Eurobaloney? In this Republican presidential primary campaign, Europe has been nothing but a foil. Anti-Europeanism has been a code word for anti-liberalism.  At the same time, Americans have long appealed to European politicians not to pander to the anti-American segments of the European public, fearing that fleeting prejudice could turn into lasting chauvinism. Gerhard Schroeder, then-German Chancellor, earned condemnation in the United States when he played to the pacifist anti-Americanism of his electorate to gain re-election in 2002. Should Mitt Romney, Newt Gingrich, and the rest of the Republican candidates really be held to a different standard?

Thomas Kleine-Brockhoff is a Senior Fellow and Senior Director for Strategy at the German Marshall Fund of the United States 

WASHINGTON – Immigration and integration continue to be issues of paramount public concern in both the United States and Europe, and yet so rarely do we hear a transatlantic view on the common challenges faced by countries dealing with diverse immigrant populations. It is crucial to understand the views of the public on these key topics. Today marks the release of the fourth annual Transatlantic Trends: Immigration survey (TTI), which this year polled residents in the United States, the United Kingdom, France, Germany, Italy, and Spain. While the survey sheds light on the internal debates in each country, there are also trends across countries and transatlantic dynamics that TTI alone captures.

View country-specific findings

In 2011, one of the biggest stories in international affairs, the so-called Arab Spring, posed the specter of a direct migration challenge for countries in Europe, though in practice most migration stayed within the region and did not reach European soil. Some politicians warned of an “invasion” of migrants from the countries in North Africa and the Middle East going through political upheaval. Italy complained of a lack of European burden-sharing on the flows of migrants, with pressures most evident on the island of Lampedusa. French President Nicolas Sarkozy objected to Italy’s admission practices, and temporarily cut off entrance from Italy to avoid receiving unwanted migrants.

Given the rhetoric in 2011 surrounding that migration “crisis,” the continued popularity of populist parties in many European countries, the intensification of the economic crisis and euro crisis in Europe, and continued pro-enforcement discourse in the United States, we expected to see a decline of public support for immigration. Instead, TTI shows a remarkable absence of change in views since 2010. As in previous years, about half the transatlantic public saw immigration as more of a problem than an opportunity, and, equally, about half thought there are “too many” immigrants in their countries. Publics were increasingly unhappy with their governments’ management of immigration, however, with highest discontentment in Italy where 83 percent of respondents reported their government is doing a poor job managing immigration.

The role of the European Union in migration concerns is fundamental to understanding these dynamics. The survey shows evidence of growing support for a strong European Union role in immigration issues, which has been a source of ongoing struggle on the path toward full cooperation and harmonization. On the issue of migration resulting from the Arab Spring, strong majorities in all European countries agreed that the European Union rather than the country of first arrival should be responsible. On the more general question of whether the European Union should have the power to determine countries’ national immigrant admissions numbers, support went up since 2010 in every country polled. Overall, 42 percent of Europeans polled agreed that the EU should decide national immigrant admissions numbers. The highest support was in Italy (60 percent) and Spain (51 percent). Even the U.K., where only 18 percent of respondents supported EU responsibility, showed a large increase from 12 percent in 2010.

Parallel to discussions and dynamics in Europe, on the other side of the Atlantic, Americans also continued to struggle with issues surrounding governance and the appropriate level of government to address immigration. Debates rage on regarding the role of states and localities in immigration enforcement. The most recent initiative in Alabama to step up immigration enforcement is only the latest in a string of state-level moves.

TTI shows signs that the U.S. public is not necessarily in favor of state-level control, and actually prefers centralized control of immigration. Fifty-four percent of U.S. respondents thought that the federal government, rather than state and local authorities, should have primary responsibility for enforcing immigration law. The public is also quite moderate in its views regarding the rights of undocumented children and youths. The public supported, at 65 percent, the provisions of the DREAM Act, which would legalize undocumented youths who successfully enter university or the U.S. military. Even a majority of Republicans surveyed, 55 percent, supported the provisions of the DREAM Act, indicating widespread bipartisan support. On another issue of hot public debate, the preservation of the Constitutional right of automatic citizenship for all people born in U.S. territory regardless of the immigration status of their parents, a majority of Americans, 53 percent, support the preservation of that right. These rather moderate views held by the U.S. public are often invisible in the extreme political discourse focused on the border fence and pro-enforcement measures.

Europe and the United States are facing many common challenges as policymakers seek to manage the consequences of the economic crisis and continue to become increasingly diverse, immigration-receiving states. It is crucial that we take a look at public opinion on these complex issues, to illuminate current debates, and inform policymakers as they design policies and build political will to move forward on issues of critical social, economic, and political importance.

Hamutal Bernstein is a Program Officer with the Immigration and Integration Program of the German Marshall Fund in Washington, DC.

BRATISLAVA, Slovakia – The entry of the four Central European countries — Poland, Hungary, Czech Republic and Slovakia (known also as the Visegrad 4 group, or V-4) — into the European Union on May 1,  2004, was the triumphant end to a long journey.  It was a time for celebration among the quartet of post-communist countries and in the democratic West, which helped these nations achieve their successful democratic reforms.  Populations and elites in V-4 countries believed that the membership in the prosperous union would help them to built sustainable growth, tackle corruption, contain populism, and deal with residual problems from their  past.

But the current turmoil in the EU has hit these four Europhilic nations hard, both in economic and political terms. Few expected that the European Union’s problems would generate so much domestic socio-economic and political turbulence, generating incipient doubt in the common European project. In my home country of Slovakia, the crisis even brought down the government over deep discord on how to tackle the European financial stability mechanism.

Last week’s European summit devoted to the rescue of the eurozone showed more differences among V-4 countries in their approaches toward the proposed reconfiguration of Europe.  Slovakia, so far the only V-4 country to have adopted the euro, has opted to throw its lot with the group of the 17 states of eurozone, along with regional power Poland.  Slovakia and Poland have called for more German leadership in the EU.  On the other hand, the Czech Republic has declared that it will “study carefully” the current situation and likely will not join the “EU 17-plus.” Further still from the EU core, Hungary, under the powerful leadership of Viktor Orban, is fast-shifting to a position similar to the United Kingdom’s, becoming in effect a sort of “continental island” committed to the development of its own European software with roots in  Hungarian history.

The decisions made at the recent EU summit will reverberate for years to come.  Ever-deeper political divisions, a loss of confidence in the institutions, and growing apprehension have become a hallmark of today.  The collateral damage of the process on the V-4 likely will be less regional cooperation among the V-4 group, and potentially even the end of the regional project.  The crisis shaking the foundations of the European Union could prove stronger than geographic proximity, shared history, and, until recently, very similar attitudes toward the common European home.

Pavol Demes, based in Bratislava, Slovakia, is a Senior Transatlantic Fellow with the German Marshall Fund.

BERLIN – British Prime Minister David Cameron came to Brussels expecting a Europe of 17 and 10.  He left behind a Europe of 26 and 1.  His veto of a treaty intended for all of Europe’s 27 member states, promoting greater fiscal union within the eurozone’s present 17 members, was certainly historic. But this was not the sort of history that anyone should feel proud of making.  This was a victory of short-term tactical considerations over long-term strategic interests.

At the end of ten long hours of fractious negotiations, the only winners were Cameron’s Euroskeptic Members of Parliament.  For them, this is the first salvo in their war for a fundamental renegotiation of the United Kingdom’s relations with Brussels.  Cameron certainly did not win; his “leadership” in vetoing the treaty is understood even within his own party as resulting from weakness rather than strength.  His government didn’t win; the coalition is straining at the seams.  The pro-European Liberal Democrat narrative – that by being in government with the Conservative Party they are providing much needed moderation from the inside – has been shot to bits.  The 1.3 million people employed in the financial services industry in Britain, in whose name Cameron deployed his veto, didn’t win either; the City of London now waits with bated breath to learn how it will be affected by decisions made by a group in which it no longer has representation.  Nor did the many more million people beyond the City’s square-mile win; Cameron used his veto and got nothing for it.  Now either the eurozone survives within a new-look Europe over which Britain’s influence is limited, or it falls apart, with disastrous consequences all round.

But it is also far from clear that the “new Europe” has won.  Up to 26 member states now face a turgid time with their own populaces, parliaments, and lawyers as they try to fashion this new accord.  There will probably be casualties along the way, with Ireland a prime contender courtesy of its referendum requirement. Meanwhile, Europe still faces the same crisis of sovereign debt that it did before the Council met this past weekend.  The new fiscal compact, once it is agreed, might well help eurozone countries avoid similar crises in the future, but the crisis of the moment will still need resolving.  Finally, Europe will be weaker if it has on its periphery rather than in its midst one of the world’s major financial centers and most capable military powers.

It did not need to be like this.  German Chancellor Angela Merkel later commented that she didn’t think Cameron was ever really “at the table.”  He was, but he was misreading the game.  Were France and Germany meant to haggle more to keep the U.K. on board?  And if they refused to fold, as Cameron had feared they might, could the U.K. lead the other non-eurozone member states in heading up a smaller, but still influential, outer core that would keep Europe focused on the broader, rather than the deeper, picture?

Cameron’s strategy was a reasonable one, at least at the outset.  The problem was that his strategy never evolved.  Had Cameron’s team spent as much time listening to the reaction their demands for concessions were eliciting as they did making these demands in the first place, they might have understood earlier which way the cards were falling and adapted accordingly.  For example, Polish Foreign Minister Radek Sikorski had warned Cameron publicly in Berlin only weeks beforehand not to count on Poland, another non-eurozone member, as an ideological ally.  In laying out his vision for deeper integration, he addressed the U.K. directly: “We would prefer you to join in, but if you cannot, please allow us to forge ahead.”  Meanwhile Britain’s lists of demands continued to be submitted on more private channels but were met with total silence.  Should these have been clues that the formula of 17 and 10 might not hold?  Had this been understood, cards could have been played differently.  Why not, for example, seize on the Commission’s suggestion to introduce the new fiscal rules through Protocol 12 – an annex of the treaties – thereby avoiding the need for ratification by national parliaments or referenda, and use this as a basis to secure some less-ambitious concessions?

One weekend of miscalculations later, the end sum is a Europe today that consists of 26 member states aiming to pool sovereignty further while one onlooker looks to retrench.  For some time now, the eurozone crisis has looked set to bring about the dividing of Europe into a core and a periphery.  The UK’s efforts have consequently been directed toward ensuring that, in this eventuality, the periphery would still have real influence with the core.  Now, unexpectedly alone in a periphery of one, this task has suddenly become a whole lot harder.

Sarah Raine is a non-resident fellow based in Berlin with the German Marshall Fund of the United States.

CAMDEN, Maine – Once again, Europe’s leaders did not brandish the big bazooka that the markets are crying out for. Instead, Europe is doggedly pursuing its step-by-step approach as introduced several summits ago. Given the continuing disconnect between markets and politicians, we know from experience what will likely happen next: After an initially favorable response, the markets will realize that the latest comprehensive plan wasn’t all that comprehensive; that there are not enough short-term crisis resolution measures in Friday’s package to reassure investors about the safety of their assets; and that long-term fixes are impressive, but incomplete. Soon, politicians will scramble for what to do next to prevent a market meltdown.

Therefore, it is already time to map out the next steps. There are at least five:

1. Ensure European Central Bank (ECB) intervention: ECB President Mario Draghi has welcomed the results of the summit because they enforce spending discipline among the countries that use the euro. This positive outcome should reassure Draghi that temporarily enlarging the balance sheet of the ECB is acceptable when the goal is to keep the borrowing costs of southern European countries at a sustainable level. Increasing the volume of the bond purchases on the secondary market when necessary will go a long way toward communicating to the markets that no European country will let the euro fail and that the ECB will provide the bridge funding until the structural reforms work.

2. Prepare a eurobond proposal that Germany can accept: The original draft of the summit’s final statement called for eurobonds. On German insistence, the paragraph was struck from the draft. But German opposition is not as ironclad as it seems. Chancellor Angela Merkel has not said “no, never,” but rather “not now.” She sees eurobonds as the capstone of the European edifice. Last week’s summit results ensure that countries cannot borrow irresponsibly in the future while betting on a European bailout. This outcome should ameliorate Germany’s concern about moral hazard and allow the country to take steps toward formally assuming the joint and several liability that it already has in practice. The temporary “debt redemption fund” that the German Council of Economic Advisors proposed has the best chance of being politically acceptable.

3. Convince the United States to increase the IMF’s firepower: During the summit, the Europeans decided to funnel an additional $ 270 billion through the IMF to help build a wall of money around Spain and Italy in order to contain financial contagion. That’s good, but not enough. U.S. President Barack Obama has said that Europe has enough money to help itself. But the numbers don’t add up. To cover the borrowing needs of Spain and Italy for the next three years (the timespan needed for an adjustment program), $2 trillion will be required. The United States wants Germany to cover the lion’s share of that amount. But Germany is too small to carry such a load. German guarantees for its neighbors already excide next year’s federal budget by 80 percent, and debt already exceeds 80 percent of GDP. The IMF has a remaining lending capacity of $380 billion, now propped up by the Europeans to reach about $650 billion. Clearly not enough. After having travelled to Europe last week to pressure the locals, U.S. Treasury Secretary Timothy Geithner should now travel to Capitol Hill to convey the bad news. No longer do the Americans have the choice whether or not to spend U.S. taxpayer money to address the European crisis. The question is rather whether they would like to pay for the crisis by way of increasing the IMF’s firepower or by way of the global recession/depression that a collapse of the euro would inevitably cause.

4. Work on a growth agenda for Europe: So far, crisis resolution measures have focused on debt and banks. In order to avoid a repeat of the current predicament, Europe needs to rebalance and grow. The next steps toward a fiscal union, as well as the reform packages in the southern countries, need to focus on growth and the restoration of competitiveness. Northern Europe will need to play its part to allow for the adjustment.

5. Bring in Britain from the cold:  No Europe without Britain. If British Prime Minister David Cameron’s veto against fiscal union is the first step toward Great Britain leaving the European Union, the summit will have been a pyrrhic victory for the euro-integrationists.  Therefore, the countries that agree should present another offer to the dissident from the island. On the face of it, David Cameron’s request for safeguards for the British financial industry is not unreasonable as long as it does not require undoing the structural changes toward fiscal union. Only when Britain remains inside the tent will countries like Hungary, the Czech Republic, and even Sweden be enticed to stay there as well.

The financial markets might accept that no bazooka will be deployed as long as there is a credible plan for the next steps to be taken. “Step-by-step” should not be misunderstood to mean “stumble along.”

Thomas Kleine-Brockhoff, a Senior Transatlantic Fellow and Senior Director for Strategy, directs the German Marshall Fund’s EuroFuture Project.

BRUSSELS — Old habits do die hard. In the past year, and dramatically in the past month, references to German dominance of Europe have multiplied. They are motivated by Berlin’s leading role in solving the Eurozone’s sovereign debt crisis, including in the deal agreed to today. Direct parallels with Nazi Germany’s ambitions have been dared: winner of World War II; IVth Reich; Gauleiters in Greece with the “Third Reichenbach” in the new Gestapo headquarters. Chancellor Angela Merkel’s policymaking has been described as Bismarck-like. And these parallels did not emerge only from angry blogs or tabloid headlines, but in the mainstream media and in public interventions, too.

Really? Do Europeans still think that way?

There is an evident contradiction within the EU in asking for Germany to live up to its responsibility but at the same time making sure Germany does not get too powerful. More than that, Europeans have been hearing claims at the political level that Germany has finally succeeded in dominating Europe. Economic dominance has led to long-awaited political dominance. Within Germany, some are proud; elsewhere in Europe, some accuse.

Nowadays, it seems a clear separation is deliberately being made between Berlin’s actions or inactions, and its intentions. In times of crisis and elections, shortcuts with the past are dangerous, easy, tempting: because Germany is the only one who can save Europe (although Germany alone cannot do much), Germany wants to dominate Europe, and it never stopped wanting to.

On Monday, during a key press conference on the future of the EU, President Sarkozy and Chancellor Merkel jointly condemned and warned against such amalgams, which have largely come from those out of power. Several French ministers have also come out strongly to protect France’s friendship with its German ally.

Populist and nationalistic discourses in European democracies are one thing. Defending national interests and sovereignty around the negotiation table is another. But doing it by using blunt fear is dangerous and petty. It is not courage, nor determination; it is frustration and dishonesty at their worst.

Not all fault lies with those outsiders. Berlin’s hesitations to fully step up are fueling negative outside perceptions of the country. And the more Germany is put in the spotlight before every “crucial” summit, the more it will be perceived as setting the agenda, or worse, pushing its own. But wouldn’t it be the same for any country in this position? The hit at Germany is cheap, and most know it, but they still enjoy the sport of it. Is this how the EU’s great political, economic and social achievements should be summarized? And why are new generations more frightened by Germany than older ones?

The sad comparisons and references to Europe’s history barely conceal the more fundamental issue of peoples’ perception of leadership, dominance, and domination. The three concepts are different, much in the same way that responsibility, influence, and control are distinct, too. Perceptions have the ability to irrationally downplay actions or exacerbate intentions. Dominance is a perception, domination is a fact. Leadership is a driver, and Europe has not been led for a long time. While most Europeans are adjusting to the idea of having someone in the driver’s seat, it is a collective responsibility to make sure that vile sentiments from the past do not resurface and tarnish the immense opportunities that lie ahead for peace and prosperity in Europe. Let’s not take either of the two for granted.

When Europe is asked to be at its best, some always feel the urge to immediately bring it down to its worst; and mostly for short-term political gains. It’s lunch money. But Europe is not a playground and the line is thin, very thin, between politics and ideology, calumny and desperation. Let’s not walk that line.

Doomsday scenarios for Europe will continue to be drawn, and Europeans will keep on pointing fingers at each other in case of feared failures. But in today’s environment, deeply rooted blame will fall inevitably on Germany at every single occasion; this might only be the beginning of the wave. Germanophobia is not the hatred of Germany — it is the fear of Germany. As such, it risks becoming the easy excuse to dodge one’s responsibilities, and to prefer inaction and apathy. All-for-one, yes, but never one-for-all.

Raising the specter of German dominance will follow trends and personal agendas across European countries. It is not rampant, but very much standing straight. As so, it is the duty of political leaders to firmly reject and condemn any attempt, by anyone, to revive fear, anger, and worse among the peoples of Europe.

In Brussels, the offspring of two nationals from different member states are valued as children of a “mixed couple.” In slowly finding its way out of the crisis, and ahead of unforeseeable challenges, Europeans need to be reminded of what they have achieved through tolerance, humility, and understanding in a little less than 65 years.

Guillaume Xavier-Bender is a Program Associate with the Economic Policy Program of the German Marshall Fund in Brussels.

Image by the European Council.

BERLIN—It is German Question Time once more in Europe. Only Germany, the continent’s most powerful economy, and still miraculously going strong, can lead the way to a recovery. That much is admitted from Lisbon to Tallinn, and even in Berlin.

The problem is that the Germans, less than two weeks before an historic EU summit weighs far-reaching treaty reforms to calm the markets and—perhaps—save the eurozone, are still debating the wrong questions. How much “leverage” is enough? Would “elite bonds” help? Might a “stability union” do the trick? This past Monday night, however, a Pole came to Berlin and spelled out the Question for the Germans. Or rather, he chiseled it in stone, in the starkest possible terms. In doing so, he demonstrated a remarkable grasp of his Western neighbor’s psychology.

Polish Foreign Minister Radoslaw Sikorski began his speech with an astute reference to the tired cliché that Europe has become boring because it is no longer about matters of war and peace. Wrong, he said — the Balkan Wars began in 1991 with the disintegration of the dinar, the Yugoslav currency. Those wars, lest anyone forget, lasted 14 years and claimed up to 130,000 lives. They caused Germany to offer shelter to 300,000 refugees, and to go to war for the first time in its post-World War II history. It was a reminder guaranteed to get his audience’s rapt attention, and keep it.

Sikorski bowed to his German friends, Chancellor Angela Merkel and Foreign Minister Guido Westerwelle, by supporting their calls for automatic sanctions, an elected European president, and more European integration. The Framers of the U.S. Constitution, he noted, had done something very similar when they decided to make their historic move from a confederation to a real federation.  (It’s not every day German leaders get compared to James Madison and Thomas Jefferson.) Even more shrewdly, the Minister reminded his listeners that a key element of the deal had been Alexander Hamilton’s brokering of a joint debt guarantee and revenue stream for the 13 founding states—an elegant way of pointing out that eurobonds, and a stronger European Central Bank (both still officially anathema to Berlin), are the logical conclusion to calls for a stronger EU.

Sikorski also thanked the Germans for their “solidarity” with Poland after 1989 — but not without adding that “I hope you appreciate it’s been a good investment.” In 2010, German exports exceeded 1990 levels ninefold. (Achtung, subliminal message: being nice is even nicer when it pays very nicely.) Was there a hint of acid in his subsequent remark that Germany’s trade with Poland is bigger than with the Russian federation, “although you would not always know it from German political discourse?” Perish the thought.

But by then it was time to dispense with diplomatic politesse. Sikorski had already pointed out that Germany has profited more than any other countries from exports to the ten new Eastern European members after 2004: its annual export volume rose from 15 to 95 billion euros in 2010. In the last third of his speech, he bluntly enumerated six reasons why Germany owes its fellow EU members solidarity:

• Germany is the biggest beneficiary of the eurozone
• Germany is not an innocent victim of others’ profligacy, having broken the Growth and Stability Pact and let its banks “recklessly” buy risky bonds
• Germany has profited from lower borrowing costs
• Germany stands to suffer most from a breakup of the eurozone
• The danger of collapse is “much bigger” than the danger of inflation
• Germany’s size and history give it a special responsibility to preserve peace and democracy on the continent (Here Sikorski quoted Jürgen Habermas, German secular intellectuals’ answer to the Pope: the last time a German revolution failed, in 1848, it took a hundred years to regain a similar level of democracy.)

At this point, the silence in the auditorium (packed with about 300 diplomats, policymakers, think-tankers, and other citizens—and including two former German presidents) was deafening. We were sitting only a stone’s throw from the Brandenburg Gate, Berlin’s graceful symbol of reunification—the Eastern side of the Gate, which only 20 years ago had been disfigured by the Wall, lethal coils of barbed wire, and goose-stepping Volkspolizisten. Recent history has been very generous to Germany; some may have thought: redemptive. Not a nice thought that things might go into reverse again.

To finish, Poland’s foreign minister reminded the Germans that their country is not an island: “The biggest threat to the security and prosperity of Poland” … is not terrorism, not the Taliban, not German tanks, nor Russian missiles… but “the collapse of the eurozone.”

“I demand of Germany that,” Sikorski continued, “for your sake and for ours, you help it survive and prosper. You know full well that nobody else can do it. I will probably be the first Polish foreign minister in history to say so, but here it is: I fear German power less than I am beginning to fear German inactivity. You have become Europe’s indispensable nation. You may not fail to lead.”

The applause at the end of Sikorski’s speech was genuinely warm, if permeated by a sense of shock. In Germany, home truths are usually muttered—rather than pronounced firmly and clearly, with attention paid to enunciation and phrasing.  Perhaps fittingly, it was former president Horst Köhler—himself born in Poland—who stood up and thanked Sikorski: “For you as Polish foreign minister to give this speech here today—I think it’s wonderful.”

Constanze Stelzenmüller is a Senior Transatlantic Fellow with the German Marshall Fund in Berlin

Image by Dirk Enters, DGAP.

BRUSSELS – Polish Foreign Minister Radoslaw Sikorski came to Berlin and, in the presence of the German foreign policy establishment, asked – indeed, demanded – Germany to play the leading role in solving Europe’s crisis.

Sikorski analyzed the elements of the crisis and arrived at the stark conclusion that only two scenarios for its continuation exist for the European Union — deeper integration or collapse.

Sikorski offered Germany Poland’s unwavering support. In case this sounded like a return to government by nation-state alliances, he explicitly proposed a major strengthening of the European institutions, declaring that Poland was ready to pool more national sovereignty if it led to a stronger Europe.

This was a politician, this was a statesman, exploding a series of myths:

• the myth that the crisis is a result of a premature enlargement of the EU. He insisted on the economic contribution already made by the new member states, and in particular the performance of Poland, whose fiscal discipline trumps even that of Germany.
• the myth that the eurozone can continue to muddle through until its problems are resolved. For him “too little, too late,” a failure to adapt its governance, would lead to the breakup of the EU , just as the Federation of Poland and Lithuania collapsed in 1795, leading to a century of Polish partition.
• the myth that the member states of “New Europe” lag behind “Old Europe” in their commitment to ever-closer union in the EU because they are so attached to their recently regained sovereignty.

This was a politician prepared to speak truth to power, to spell out the chaos that would ensue on a collapse of the euro, to tell the countries of Western Europe that their welfare states must now face a new reality of austerity, to demonstrate to his own voters that he is prepared to trust the country that invaded his in 1939.  For him, the time of denial is long past; only the courage to do the right thing, however difficult it may be, can save Europe from going over the precipice.

Sikorski sketched out the broad lines of the stronger EU he envisages. The Commission would be given the watchdog role over EU member state budgets, a watchdog with teeth, to ensure that they live up to their fiscal discipline responsibilities. Member states would collectively guarantee all national debts; total solidarity would balance responsibility. And the European Parliament would have powers of co-decision in approving budgets in order to ensure the democratic legitimacy of the new order.

For Sikorski, the Commission would be composed of merely a dozen powerful commissioners with authority, personality, and charisma. He proposes unifying the posts of president of the Commission and president of the Council. And he cleverly expresses admiration for the idea he ascribes to Angela Merkel of this president being directly elected.

This was the speech of a politician who knows his history, does not want to repeat its mistakes, and has the strength and the clarity of mind to formulate a convincing message of hope for the future based on mutual trust between the European nations, which the crisis has so far called into question. It is also a demonstration of authority, personality, and charisma. Perhaps the EU has found its new president.

John Richardson is a Senior Resident Fellow with the German Marshall Fund in Brussels.