The bloc is neoliberal by design, indeed it punishes member states which dare deviate from the neoliberal course.

Even the major treaties which build the foundation of the EU were implemented by force, after the people of some member states voted against them in referendums they were simply signed and implemented anyway.

These are what I’ve tended to point to (largely thanks to Michael Hudson^[1]). Quoting from Fazi’s piece:

But the reality is that many of the EU’s fundamental problems do not arise from mere “policy missteps” or, even less so, from the bloc’s supposedly “incomplete” nature. Instead, these issues are deeply embedded in the EU’s supranational design. In other words, the only way to truly tackle the EU’s economic challenges is to recognise that the core issue is the EU itself.

One of the most significant — and frequently overlooked — constraints on the EU economy is the euro. The loss of monetary sovereignty entailed by the currency, coupled with the stringent deficit and debt rules enshrined in the EU treaties, remains one of the single greatest barriers to growth in Europe, hampering the ability of member states to stimulate their economies through public investment and active industrial policies.

Moreover, the EU has failed to offset this surrender of sovereignty with adequate European-level fiscal and investment tools, limiting itself to temporary measures such as the Covid-19 recovery fund. This structural limitation is a key reason why public sector investment in the EU has consistently lagged behind that of the United States and other advanced economies.

Besides, even if the EU were to succeed in expanding its “federal” fiscal and investment capacity, as envisioned by the Competitiveness Compass, this would only create more problems than it solves. Rather than addressing the EU’s structural issues, such a move would only further empower its supranational institutions, particularly the Commission, deepening the bloc’s technocratic and undemocratic governance.

Another issue is the EU’s historical bias against robust industrial policy. Since its inception, the EU has been deeply influenced by neoliberal economic doctrines that emphasise the supposedly “distortionary” nature of industrial policies. Stringent state aid rules broadly prohibit any support granted by member states that could favour certain companies or industries, unless explicitly allowed under specific exceptions. The idea is that allowing member states to support their domestic industries could lead to an uneven playing field, creating conditions where companies with state backing have an advantage over others. But this leaves Europe dramatically ill-prepared to compete with countries such as China and the US, which have relied heavily on state-led industrial policies — such as the CHIPS and Science Act and the Inflation Reduction Act (IRA) — to achieve a competitive edge, especially in recent years.