The end of Euro-optimism?
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Despite the challenges Europe faces, there are still Euro-optimists who claim cooperation and eventually greater integration than now exists will be the final outcome for Europe's future. After all, they note, Jean Monnet, one of the EU's architects, argued: "Europe will be forged in crises, and will be the sun of solutions adopted for these crises."

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The Paris attacks play into the brewing political storm surrounding the right approach to the refugee crisis. Polls already show that immigration has become the public's main concern across the EU, replacing concern about the weak economy. German Chancellor Angela Merkel and others have tried to dissociate migration policy from the heightened threat of terrorism, with limited effect. The refugee stream has bolstered the rise of populist parties and rifts in the EU.

Stories of gardens filled with litter and excrement on the streets have led to nationalistic and outraged sentiment from Hamburg, Germany to Vienna. New accession countries such as Poland and Slovenia have refused to take their quota of refugees. And Victor Orban, president of Hungary, has seen his popularity rise above 80 percent with his opposition to any refugees in Hungary. Needless to say, this opposition to the Merkel position has put enormous pressure on the Schengen accord that has guaranteed free movement of people inside the EU since the 1990s.

The key to the future of the EU may be the October 2016 referendum in the United Kingdom. Prime Minister David Cameron's wish list for renegotiation of membership includes an opt-out from further political integration and a tightening of welfare eligibility for migrants. EU leaders may be accommodating for fear of losing Britain's military and security assets, but since the British public is split, the outcome of the referendum remains unclear.

Increased border security is likely to hurt trade and raise the specter of Westphalian reassertion. Germany may be willing to accept the refugee tide, but the resistance in Eastern Europe to Merkel's view is palpable. Whatever transactional benefits accrue from integration are less significant in the long-term than national security. And as long as terrorism and the sweeping mass of refugees are linked, Euro-skepticism will be on the rise.

European leaders are asking if the Paris attack is part of a continuum of human bloodshed emanating from a protracted war against radical Islam, whatever the ultimate outcome with the Islamic State in Iraq and Syria (ISIS). If this is the case, as I would argue it is, then Europeans must get serious about defense spending and national sovereignty. The current crisis in Europe is rooted in the systematic breakdown of state control in the Middle East. Yemen, Syria, Libya and Iraq are essentially failed states facing sectarian conflicts and proxy wars between Shiites and Sunnis.

With European economics faltering and with welfare and defense spending increasing, the burden on fiscal policy across the continent will yield and has yielded to an extreme political response on the left and the right. Emerging from the crisis is a civilizational challenge. Notwithstanding claims from the Euro-optimists — who sound more each day like Pollyannas — it is hard to imagine how Europe maintains unity. The euro, as one signal of the crisis, has declined in value precipitously and with easing on the horizon, the value of the currency is unlikely to recover from its recent descent.

Hence, the skeptics seem prescient. The Margaret Thatcher predictions for Europe were eerily on the mark. For a considerable period, European leaders turned their back on reality, but that reality can no longer be denied. Terror is not coming in the backdoor; it is already here on the streets of cosmopolitan cities like Paris and Brussels. Terrorism may lurk among the refugees. And the waves drifting across the Mediterranean will carry immigrants as far into the future as one can imagine. The dissembling influences are on the march. Band-aid measures may temporarily help to curtail the general trend, but the EU is in a death spiral and all the happy talk is unlikely to prevent it.

London is president of the London Center for Policy Research.