THE STATE OF THE EUROPEAN UNION. Reforming Europe in a time of war

Social Europe: Retaining the status quo during the pandemic, avoiding new disparities 29 order that emerged in the last 30 years was achieved in an exemplary manner, mostly on the basis of existing foundations, for example in the form of university tradi- tions and long-established companies. The situation is completely different in peripheral re- gions: no large conurbations have emerged here; people live in small towns or in rural villages. However, rural regions are divided into those with traditionally average socioeconomic working and living conditions and those that have already fallen behind. The peripheral regions usually have a special economic history. They are areas that have seen a sharp decline in once important in- dustries, such as mining in Germany’s Ruhr region and textile manufacturing in Estonia’s northeast, and obso- lete industries in Romania’s border regions, Italy’s south- ern regions, France’s northeast, and Germany’s eastern states. In some relatively poor regions of Spain, Sweden and Romania, it is the loss of importance of agriculture as both a value-added sector of the national economy and, with the effects of automation and mechanisation, as a major employer. In these regions in Sweden, after manufacturing and agriculture, the public sector has also been sidelined as an important source of demand for labour since the 1990s. In the peripheral and less urban- ised areas, far removed from the national average and even further from the prosperous metropolitan regions, educational opportunities are few and far between; in particular, university attendance is often not possible due to a lack of nearby institutions. Well-paid employment opportunities are therefore scarce, and infrastructure and public social services were either never comprehensively developed or are oversized reminders of better times that incur high upkeep costs. This is especially true in view of the low revenues of the public sector in line with the lack of economic momentum. At the same time, rising social costs, due to unemployment, an increasing risk of poverty and an aging society, are problems from which younger people have long since turned their backs in search of better prospects in other parts of the country. There is almost nowhere in the peripheral regions that has managed the leap into service societies with- out strong urban centres. This is not the case in areas with a high share of tourism activities, such as the Med- iterranean regions of Spain, France and southern Italy, as well as national parks and wilderness conservation areas in northern Scandinavia. However, tourism is a double-edged sword: while it offers good employment options, the services demanded here fall into the service sector rather than the knowledge sector and are corre- spondingly low paid. Moreover, apart from city breaks, tourism is highly seasonal and has a limited impact on improving living conditions and economic momentum. During the pandemic, the certainty of temporary high employment had been shaken by restrictions on mobility and travel. In view of the divergences between economically de- veloped centres that are fit for modern service societies and global competition and peripheral regions that are less able to cope with structural change, we can speak of a double spatial and social polarisation. For the periph- eral regions, a repetitive vicious cycle is evident: with the disappearance of industrial centres, without a designed transformation, what remains is only a concentration on the low-wage service sector, such as in tourism and/or agriculture. Low growth and poor educational opportu- nities lead to an exodus of well-educated and especial- ly younger people, leaving the elderly and less mobile people behind. High unemployment often occurs in the context of disappearing industries; in agriculture and the service sector, employment is more erratic and in the case of tourism it is often seasonal. Local authorities are then quickly overwhelmed in the face of oversized, decaying infrastructure, the lack of higher education and employ- ment opportunities that cannot be quickly remedied, the fight against unemployment and, as a result, rising pover- ty or social exclusion, in addition to the expanded needs for social and health services for older residents. Grow- ing social and infrastructural maintenance expenditures and dwindling tax revenues are increasing public debt, with the result that urgently needed public investments cannot be made. Thus, no new economic momentum de- velops; in the long run, the municipality or county cannot