EC '92 could help restructure Europe

With war in Korea and fear spreading that the Soviet Union would march into Western Europe, the institutions of the European Community were born in the early 1950s.

They came into being to balance the economic and security interests of the Western allies who wanted to beef up Western military capabilities, including West Germany, without unleashing fears of West German rearmament.

It is ironic that the expansion of the European Community in the 1980s and 1990s may serve as the vehicle for resolving another problem of economics and politics. The institutions of the European Community may provide just what the doctor ordered to make palatable the reintegration of Eastern and Western Europe as this century draws to a close.

In 1985, the 12 core Western European nations - France, West Germany, Italy, Belgium, Netherlands, Luxembourg, the United Kingdom, Ireland, Spain, Portugal, Greece, and Denmark - agreed to create a unified common market by 1992.

EC '92, as we now call it, requires the European Community nations to eliminate all the barriers to trade and commerce among the 12 nations.

These nations also agreed to harmonize social policies - including comparable standards for minimum wages, worker's compensation and unemployment benefits - and to develop common monetary policies.

Then came glasnost and perestroika in the Soviet Union. The movement toward openness and some democratic practices in the Soviet Union, or glasnost, and the commitment to economic reform and the restructuring of the Soviet economy and business system, perestroika, spread like a virus to the Soviet satellite countries in Eastern Europe.

First came Poland, where by political and economic reforms were led by Lech Walesa and the Solidarity coalition of unions. Then came Hungary and East Germany. More recently, Czechoslovakia, Romania, and Bulgaria joined the crowd.

The pace of political change was stunning. In country after country, the Communist governments had to share power or commit to reforms that could undermine their ability to control political developments. At the same time, there was in each country a strong commitment to replace Communist command economies with a business and economic system driven by the forces and discipline of the market. The scope and pace of these political and economic changes are revolutionary.

The changes in Eastern Europe answered one question very clearly. The new Europe would grow first to the east. And the first dividend of EC' 92 could come earlier than expected. EC '92 might provide a framework for ending the artificial division of Europe that came about as a part of the diplomatic settlement at the end of World War II. EC '92 also provides a fabric of institutions to help Europeans and the rest of the world to accept more easily the rearrangement of political and economic power in Central Europe - and perhaps even the unification of the two German states.