A GRAND ILLUSION? An Essay on Europe.

By Tony Judt. Hill & Wang. 150 pp. $20.

Discussions of the European Union often work better than a lullaby: two minutes on exchange rates, and even the most seasoned Euro-wonk begins to nod. Less soporific, even bracing, is this short book by Judt, a professor of European studies at New York University. Judt avoids the drone by focusing on the big question: can the EU bring about an ever closer union and still accept new members on the same terms? Judt's answer, in a word (though with many qualifications), is no. The EU, he argues, was designed to accommodate the prosperous Europe of the Cold War--an entity that no longer exists.

Until recently, the European community worked well. Political leadership was shared by France and Germany. The economy expanded without a trace of the inflation and unemployment that plagued the continent before World War II. Prosperity blessed all social classes, and welfare was generous. But beginning in the 1970s, some of the old demons began to resurface. The resurgent influence of Germany magnified the relative decline of France. The 1974 oil crisis halted economic growth, giving rise to an urban underclass. And today, with the baby boom generation nearing retirement, the once robust European welfare states look sickly indeed.

Under these straitened circumstances, Judt notes, "it would be an act of charity" for the EU to accept its eastern neighbors as full members. Realizing this, Eastern Europe has been making its case in strategic terms: better for the West to give the East alms than leave it prey to a resurgent Russia. Yet Judt speculates that an eastern "buffer zone" would, by appearing to threaten Moscow, actually undermine Western security. At any rate, he says, the addition of any new members would only further paralyze decision making in Brussels.

Located in the prosperous, politically stable, culturally Franco-British Benelux countries, the EU's administration strikes Judt as seriously out of touch. Indeed, he maintains that, with the fall of the Berlin Wall, Germany has emerged as the de facto leader of Europe--a situation complicated by that nation's deep ambivalence toward its own power. With a characteristically apt turn of phrase, Judt describes post-1989 Germany as "a muscle-bound state with no sense of national purpose."

Recent upheavals make this leadership vacuum all the more troubling. With the crisis of the welfare state and the continuing influx of immigrants--many of them Muslims who do not assimilate easily into modern Europe--neofascism is rearing its ugly head. Likewise, the collapse of communism has allowed Europe's trademark nationalism to revive, reaching tragic extremes in the former Yugoslavia. Regrettably, Europe's leaders and intellectuals remain wedded to the notion of union as a cure-all.

Does Judt consider himself a skeptic on European unity? Not really. While he argues that local problems need local solutions, he holds no illusions about the "embattled, mutually antagonistic circle of suspicious and introverted nations" that once made up Europe. He would like to split the difference. "Europe," he writes, "is more than a geographical notion but less than an answer." Union may be desirable in some respects, but it's not the Holy Grail. "We must remind ourselves not just that real gains have been made, but that the European community which helped to make them was a means, not an end."