Way Forward for Europe
Žiga Turk
@Growth and Jobs Summit,
Brussels, 12.3.2009

How about the future of
Europe: Let's ask Google
2

Let's reinvent the continent
§ oops, sorry, the
wrong continent!
§ lets set up a
committee or
two!
§ Reflection Group
§ Future of Lisbon
Strategy
3

2007 … in the good
old times …
§ EU expansion, Euro a success
§ Lisbon Treaty on track/signed,
institutional matters settled
§ economic upswing, in part attributed to
the Lisbon Strategy
§ soft power Europe - leading global
climate change agenda
§ Europe to lead the globalization
4

The sky was the limit
§ Mark Leonhard: \"we will see the emergence of a New
European Century. Not because Europe will run the world as
an empire, but because the European way of doing things
will have become the worlds\".
§ Jeremy Rifkin: \"Much of the world is going dark, leaving
many human beings without clear direction. The European
Dream is a beacon of light in the troubled world.\"
§ long term visions: a proposal for a group of wise men to
think about the future of Europe
§ economic, social and environmental strategy: Lisbon
strategy 3.0
5

Reflection Group
§ to identify the key issues and developments which the Union was
likely to face and to analyze how these might be addressed.
– strengthening and modernizing the European model of economic success
and social responsibility,
– enhancing the competitiveness of the EU,
– the rule of law,
– sustainable development as a fundamental objective of the European
Union,
– global stability,
– migration,
– energy and climate protection,
– and the fight against global insecurity, international crime and terrorism.
§ particular attention should be given to ways of better reaching out
to citizens and addressing their expectations and needs.
§ headed by former Spanish PM Felipe Gonzales
§ www.ReflectionGroup.eu
6

Lisbon Strategy 2010-2020
§ The European Council (March 2008) stresses that a
continued EU-level commitment to
– structural reforms and
– sustainable development and
– social cohesion
§ will be necessary after 2010 in order to lock in the progress
achieved by the renewed Lisbon Strategy for growth and
jobs.
§ The European Council therefore invites
– the Commission,
– the Council and
– the National Lisbon coordinators
§ to start reflecting on the future of the Lisbon strategy in the
post-2010 period.
7

2009 Crises
§ institutional crisis
– treaty stuck in Ireland
§ climate crisis
– somehow forgotten, \"temperatures flat since
2001, but warming will return\"
§ financial, then economic crisis, possible
spillover to political crisis
8

The triggers and deeper
reasons
§ triggers
– many living over their means,
– lack of information in the financial market,
– regulation that did not compensate for that,
– risk aversion and distribution,
– market distortions,
– poor decisions made in the financial sector
§ deeper reasons
–…
9

21th century structural shifts
/ undercurrents
§ shifting of center of gravity of global economy
– after 500 years re-emergence of China as #1 economy
§ conceptual economy
– \"almost all of the real-value-added increases in
our output reflect the embodiment of ideas\"
§ peak oil and possible 3rd industrial revolution
– 100 years since the 2nd (oil)
§ other scientific progress
– biotech, medicine, genetics, nanotechnology
10

Perfect storm
§ structural shifts + crisis =
§ instability, discontinuity, future \"not like the past
but better\" any more
§ destructive questioning the proven patterns of
the past (capitalism, markets, democracy, greed
…) without offering workable alternatives
§ looking for silver bullets and utopian regressions:
government control, protectionism, redistribution
of wealth …
11

Threats and opportunities of
the storm
threats opportunities
§ not good for Europe § government
interventions are
– common market is the
acceptable, even
bedrock of European
integration desirable
§ not good for business § weaknesses are
at all! exposed
§ not good for doing § there is motive for
long term strategies reform
12

Responses
§ tactical response: addressing the symptoms
with stimuli, bailouts, confidence building,
cheap oil … sooner or later they would get
traction
§ strategic response: addressing the structural
shifts, the weaknesses exposed by crisis
– Asia, automation, abundance
13

The crisis of abundance
§ economy can stand still, § luddites: the end of
because we can live work
without new stuff for a
§ communists: Give
year or more
money to the poor that
§ fewer and fewer workers
will spend it
needed to make the stuff
§ environmentalists:
we need
Spend money to save
the planet
§ snobs: Sell meaning,
brand, content, design
… not function
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Crisis is deep
§ we will have to do a little bit of everything
§ conceptual economy
– intellectual property rights or another pattern
of innovation
• \"Should the law have protected Newton's and
Leibniz's claims in the same way that we do those
of owners of land?\"
– talent, human resources
– innovation, creativity … culture, values
15

Conceptual economy, culture,
values are a legacy of Europe …
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… and Conceptual Economy is
Europe's Game
§ the future is bright
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In conclusion
§ the crisis is deep and serious, but this too will pass
§ there are plenty of challenges, big picture issues, stuff that
matters (care for the people, care for the nature)
§ short term action must not play against long term structural
shifts
§ build on what has been good and what has worked to
create enormous prosperity, a long period of growth and
peace
§ an EU reform strategy is welcome - Brussels can push for
the right thing not for the popular thing
§ create mechanisms that turn good ideas into action
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On a rough sea you must
keep an eye on the horizon
because the sky is the limit
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