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 domination of the Continent's premier industrial power, Germany, which will turn the euro into a kind of supermark. Lacking financial resources of its own, this monetary union will probably not create social mechanisms capable of compensating for the devastating effects on employment caused by productivity differences between regions. This could lead the richest regions-such as Piedmont, Catalonia and Flanders-to refuse joint liability for their less fortunate neighbors and to decide to talk directly with European Community authorities in Brussels and Frankfurt. Faced with a rapidly growing membership, the Union will no longer be able to remain a decision-making center with a coherent economic and security policy or a credible |
defense. Lacking a strong common will, moreover, most of the European Union countries will be unable to reduce their tax burdens. They will cease to be competitive because of high labor costs, which will move various activities toward Africa and Asia and thereby increase European unemployment. According to this scenario, only Germany will be able to get by, if it manages to maintain its social consensus, its banking resources and its lead in certain key sectors. Even then, Germany will be held back by the recessionary climate surrounding it. At the same time, all European countries will raise military spending because of a double threat. To the east, there will be a Russia in turmoil, financially drained and gradually fragmented into more or less autonomous provinces, several of which have nuclear armies run by one or more local generals. To the south, there will be a Maghreb tested by a radical Islam, where millions of desperate inhabitants will be tempted to cross the Mediterranean, thus multiplying the risks of all kinds of destabilization. In sum, if the countries of Europe remain divided, the most probable outcome is that the market  2 of 5
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