Ash, Greek credit crises reveal a disunited Europe

[April 29, 2010]  LONDON (AP) -- It can be easy to forget about borders in Europe, a continent united by fast trains, cheap flights, a single currency and passport-free travel stretching from Portugal to Poland.

A pair of massive crises that hit the European Union this month have been a startling reminder, however, that cooperation and regulation are still a long way from taming the old forces of national self-interest and disorder.

The disruption of aviation by an Icelandic volcano ash cloud and the contagious Greek debt crisis have revealed a continent linked by complex systems but strangely lacking in tools to quash threats in any coordinated way.

European aviation is, by definition, an international affair. But virtually every aspect of it is controlled by individual nations, not the EU. When Iceland's Eyjafjallajokull (ay-yah-FYAH-lah-yer-kuhl) volcano started spewing ash two weeks ago, national authorities were largely on their own in deciding how to respond. What followed was a cascade of total airspace closures that cost European airlines and related businesses up to euro2.5 billion ($3.3 billion) and left some 10 million of travelers stranded around the world.

Only after a week of paralysis, with airlines complaining about overreaction and sending up test flights to show jet engines weren't endangered by the dispersing ash, did the European Union produce a continent-wide response that loosened the limits on flights and began restoring aviation.

"There's very little European competence or coordination in this area," said Helen Kearns, a spokeswoman for the EU Transport Commissioner. "For the 27 to bring themselves together took far too long."

The most searing criticism being aimed at the EU has not been over the volcano response, but over indecision and lack of action on helping Greece make payments on massive debts that far outstrip national income after years of profligate spending.

"Its like the air chaos," said Karel Lannoo, CEO of the Centre for European Policy Studies in Brussels. "Who speaks for Europe? Everyone and no one."

Months of dithering due to German reluctance to anger its voters by extending billions to Greece helped trigger devastating debt downgrades of Greece and Portugal, followed by an alarming cut Wednesday in the rating for Spain -- a much larger economy.

Many are describing the lack of strong European economic governance as a deep and fundamental flaw.

"What is exposed is the underlying lack of solidarity within the euro zone," said Simon Tilford, chief economist at the Centre for European Reform in London. "It's basically exposed the fallacy of believing that it's possible to have a bunch of largely sovereign countries sharing a currency."

Together, the two crises have battered the airline business, the euro and markets, and the public image of the European Union, already the target of deep skepticism in many member nations.

Dublin hotel manager Gerard Fitzpatrick, 48, said his family had already changed its summer holiday plans because of fears of another mismanaged volcanic-ash scare.

"I couldn't imagine a volcano shutting down American airspace for a whole week. It takes Europe 48 hours just to decide whether we need to have a meeting," he said. "We're going to take the ferry to France instead of risk flying. I'm hoping the EU doesn't do anything to close international waters."

EU transport ministers reached a deal to ease flight restrictions on April 19, but the decision was not implemented simultaneously by the national governments. The Swedish Transport Agency was among the laggards, adopting the EU approach four days later, a delay that was criticized by Scandinavian airline group SAS.

"The result was that we could fly to Copenhagen (in Denmark) but not to Malmo (in Sweden). Even though they are only 10 kilometers apart," SAS spokeswoman Elisabeth Manzi said.

"We conduct business across borders," she said. "It's unfortunate to have different rules in different countries. We want to have common rules."

The EU says the ash crisis has added urgency to a long-pending reform of aviation control that would create a single central manager of the European flight system who would issue recommendations to national authorities about closing airspace in crises like another volcanic eruption. The degree to which the recommendations would be binding remains under discussion.

There is also talk about stronger EU oversight of member nation budgets, with European officials beginning to discuss ways in which the union could impose discipline on free-spending countries like Greece.

"The European Union appears ready for stronger economic coordination and stronger economic governance," EU Commission President Jose Manuel Barroso said last month.

There is skepticism, however, that the European Union can ever overcome the national allegiances of voters and politicians and become something that looks more like a United States of Europe.

"All the evidence -- illustrated most recently by the volcanic ash crisis and the Greek financial crisis -- is that the European Union is very far from being a superstate," said Tony Brown, an executive member of Ireland's Institute of International and European Affairs in Dublin. "Rather, it is a grouping of sovereign states that, when issues really bite, prefer to declare how sovereign they are."

Valerio Giardinelli, a 32-year-old who works in marketing in Rome, said the EU had not acted well in the faces of the two crises.

"When there's a problem, we are all faced with it," he said. "But what we don't have is a common solution."

[Associated Press; By MICHAEL WEISSENSTEIN]

Associated Press writers Shawn Pogatchnik in Dublin, Karl Ritter in Stockholm, Emma Vandore in Paris, Slobodan Lekic and Robert Wielaard in Brussels and Alessandra Rizzo in Rome contributed to this report.

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