EUROPEAN UNION BACK IN CRISIS MODE

The 27 member European Union, the strongest economic community in the world, is approaching a new set of predicaments - an imminent leadership crisis, and what amounts to a management dilemma reminiscent of the 2016 Brexit crisis. After 16 years in office, highly competent, authoritative, marginally charismatic German Chancellor Angela Merkel is retiring. As the dominant force in European politics for much of that time, Ms. Merkel's exit creates a significant power vacuum in the Union, which is rich in functionaries but light on visionaries, with few legitimate leaders to take her place. French president Emmanuel Macron will doubtlessly attempt to take over where the chancellor is leaving off. He has always shown a desire to be the dominant force in the EU, proposing multiple ideas for a more independent and integrated Europe. However, his leadership style has not always been well received, and he could be vulnerable domestically. Mr. Macron will be up for reelection in April next year, again facing opposition from far-right Marine Le Pen, leader of the "National Rally," a perennial euro-skeptic. His focus will most likely be predominantly on challenging domestic issues. Angela Merkel's potential replacements as chancellor are lesser known, unfamiliar players in European politics. Olaf Scholz, until recently Germany's finance minister in Merkel's coalition government, leader of the Social Democrats which won the last election, is the odds on favorite to take her place. His only conceivable rival is Armin Laschet, Ms. Merkel's successor as leader of the Christian Democrats, which lost the election by 1.6%. Neither one comes with significant EU credentials. By virtue of its dominant economic position within the EU, Germany's leadership is essential to the Union. Without Merkel's guidance, its influence will almost certainly diminish, leaving the organization potentially rudderless. This development comes at a time when the organization faces critical challenges on its eastern border. So much so that the term "polexit" has crept into the vernacular used in Warsaw and Brussels alike. While Poland's departure from the EU may still be unlikely, its government's six year long feud with EU leaders remain very real. Poland joined the EU in 2004. It has probably benefited more from this Union than any other member. However, in 2015, the conservative nationalist "Law and Justice" party took control of its government, and rapidly became an irritant to EU leaders in Brussels. The dispute originated largely over changes to the Polish judiciary system designed to give the ruling party greater control over the courts, seeking to "reform a corrupt and inefficient justice system." The European Commission believed that the changes would actually erode the country's democratic system of checks and balances. In 2019, the Supreme Court of Poland warned that the judicial reforms planned by the ruling party could result in Poland having to leave the EU, as it undermined the independence of its judiciary and challenged the primacy of EU law - a key condition for membership. Earlier this year, Poland's Constitutional Court, dominated by ruling party loyalists, challenged the notion that EU law supersedes the laws of the 27 member states with a ruling that some EU laws are incompatible with the nation's own constitution. And on October 7 of this year, its Constitutional Tribunal bluntly rejected the primacy of EU law. In response, Ursula von der Leyen, head of the European Commission, stated that: "This ruling calls into question the foundation of the European Union. It is a direct challenge to the unity of the European legal order." The legal battle between Poland and the EU has escalated into a full blown political crisis, even bigger than Brexit back in 2016, because it undermines the entire foundation of the EU. Thus far, as punishment, the organization has withheld about $42 billion in grants and loans from its coronavirus recovery fund. And last month, it asked the European Court of Justice to impose daily fines on Warsaw for defying its rulings. What counters the largely right-wing endorsement of a Polexit is that the EU remains overwhelmingly popular among Polish citizens. A national public opinion poll conducted in October found that 64.4% of those interviewed wanted to stay in the Union. Only 14.8% expressed a desire to leave. A majority, 42.6% to 36.9%, did indicate a preference for a 2nd national referendum. Poland's population generally seems to recognize that a departure from the EU would come with significant economic consequences. In 2018, 80% of its exports went to member states, while 58% of imports came from EU countries. Since 2004, the country has received an infusion of $127 billion - more than any other member. More than 2 million Poles have taken advantage of the freedom to work abroad. And, politically, its ties to NATO removed it from the influence of the Kremlin, something that could well change if the country returned to "unaffiliated" status in the harsh political reality of Central Europe. Poland is not alone in its challenge to the EU. Viktor Orban, Hungary's prime minister, has backed the "Law and Justice" party's position rejecting the supremacy of EU law, strongly suggesting that the EU must respect member states' identity. Adam Bodnar, a former ombudsman for citizens' rights, and law professor at the University of Warsaw, submits that the government may be in favor of European integration, but that it should just be economic - it is "not so interested in all the other aspects, such as political union and having respect for European values." Needless to say, the European Union has its hands full. Theo Wierdsma