Until recently, Europeans enjoyed a pretty comfortable position in most international organizations. At the IMF, they had an unquestioned hold on the directorship and could lecture other countries on how to govern themselves and run their economies, while each large European country had its own IMF representative. But all that changed in 2011. Now, Europeans are themselves being lectured by China and Brazil for not solving their financial crisis despite having the resources to do so. Europe managed to hang on to the directorship in June when Christine Lagarde succeeded Dominique Strauss-Kahn, but only because of divisions among emerging economies. If the euro crisis continues, Europeans will likely be forced to give up more of their voting weight -- as they started doing in 2010 during a reallocation of IMF board seats -- and ultimately lose the directorship.
The power realignment at the IMF is just one example of the way the euro crisis has undermined Europe's geopolitical clout in the past two years, transforming it from a reliable global problem-solver to a problem itself. True, the sky is not falling: Europe has had some remarkable successes in 2011, such as the successful intervention in Libya, the relatively smooth entry of Russia into the World Trade Organization, and the agreement reached at the Durban conference on climate change. But the out-of-control debt crisis has started eroding Europe's foreign-policy tools and degrading its leverage with other powers like China. The 2012 edition of the European Foreign Policy Scorecard -- the result of intensive research by 40 researchers under the auspices of the European Council on Foreign Relations and the Brookings Institution -- makes this downward trajectory abundantly clear. If the euro crisis is not solved this year, Europe could experience in the years ahead an even more dramatic loss of power, one that would have negative consequences for world order, multilateral organizations, and the United States.
Washington may be pivoting toward Asia and casting its lot with emerging powers like India and Brazil to maintain its leadership position. But a continued erosion of Europe's place in the world would bode ill for the Western liberal order Washington seeks to defend. For all their flaws, Europeans are still the largest contributors to international organizations and the largest purveyors of development aid, and they still outspend all the BRIC countries combined in defense expenditures. Additionally, Europe plays an important role in getting the cooperation of other powers for collective solutions favored by the United States.
Table 1: Europe's Foreign-Policy Performance for 2011.
The European Foreign Policy Scorecard evaluates the collective performance of Europeans -- both EU institutions and the 27 member states -- in reaching their foreign policy objectives in the world during the course of one year (see 2010 edition here). European performance is assessed on 80 policy issues, gathered in six broad themes: relations with China, Russia, the U.S., Wider Europe (comprised of Eastern Partnership countries, Balkans, and Turkey), Middle East and North Africa, and multilateral institutions). The table above presents the average performance of Europe for 2011.
Consider Europe's soft power. Some countries are still eager to join the European Union and even adopt the euro, countries such as Iceland, Croatia, Turkey -- or Poland and Hungary. But as Europe has drifted toward economic stagnation and political gridlock, the governance model for which the European Union stands -- that of an expanding and ever more effective multilateralism as a solution to the problems of a globalized world -- has been discredited in the eyes of many others. Advocates of regional integration projects in places such as Latin America and Southeast Asia are now less likely to look to Europe for inspiration. Last year, former Brazilian President Luiz Inacio Lula da Silva sounded this very alarm when he affirmed that "the world does not have the right to allow the EU to end" because "what Europeans achieved after [World War II] are part of the democratic heritage of humanity." Unfortunately, there's only so much the world can do. It's up to Europeans to make the idea of Europe powerful again.