From Transnational Governance to Supranational Government: Back to the Future in Times of Eurocrisis and German Hegemony

In this chapter it will be argued that the post-2008 EU-crisis started at least five years earlier. The introduction of the euro coins and banknotes (January 2002) and the completion of the European Convention (July 2003) heralded the end of two decades of extended relaunch of European integration. This extended relaunch from the completion of the Single market to the establishment of Economic and Monetary Union – itself a belated European response to the crisis of governability in the Western world during the 1970s and early 1980s – created a system of asymmetrical regulation supported by soft mechanisms of transnational governance. ‘Transnational governance without supranational government’ proved to be incapable of counteracting EU’s many contradictions. After diagnosing the origins of the current EU-crisis, the chapter continues with analyzing the responses to this multidimensional crisis at the national and European level. After a detailed account of the major steps since 2009, it will be concluded that a move towards Political Union is the most likely outcome, probably not as a great leap forward (like the one in 1983-85) but creepingly. The claim that we will witness a move back from governance to government, this time at the European level, will be theoretically and empirically substantiated by referring to the process of transnational class formation in Europe. The extended relaunch of European integration has deepened structures of complex transdependence and created a heartland of transnational production and finance. As a result, social and political interests have become too strong to let the European project collapse. This is particularly true for German capital and Germany’s political elite. In a final section, the above argument will be lifted to recent developments in the field of EU’s external relations. EU’s so-called transformative power, or external governance practices, may very well be exhausted in the nearby future, by and large as a function of the limits of enlargement. In the multipolar world of tomorrow relying on governance may be as naive as believing in the EU’s normative capabilities.