Fractured Europe blocks unified response to refugee crisis

Last Updated Sep 14, 2015 12:53 PM EDT

When it comes to existential challenges to the European Union's cohesion, it's now clear that the Greek debt drama was just the opening act. The biggest threat to the EU since its founding in 1993 may be the unrelenting flood of refugees from the Middle East.

The unprecedented humanitarian crisis it's creating reveals a continent deeply divided between those who see the new arrivals as good for their country's economy and those who see them as a drain on the public treasury and a threat to national security.

The TV visuals of Hungarian riot police throwing food at penned-in refugees contrasts radically with footage of everyday German citizens lining up with flowers to greet the weary travelers from a continent away.

But Germany, too, is acting to stem the tide of refugees. Officials said over the weekend that the country is tightening border controls with Austria and erecting checkpoints to major roads coming from its southern neighbor in search of asylum seekers.

"At this moment, Germany is temporarily resuming border controls at the Schengen internal borders," German Interior Minister Thomas de Maizière said in a statement on Sunday, alluding to the regions within Europe that have abolished passports as a requirement for entry. "This action is intended to contain the current influx into Germany and resume orderly procedures for entering the country."

In Hungary, police are moving to seal the country's border with Serbia, a crossing point for refugees, and on Monday moved to arrest thousands of people after detaining thousands more over the weekend, according to published reports. The Hungarian government said Friday it would arrest any migrant crossing the border illegally.

The lack of a European consensus comes at a time when the economic recovery remains fragile and uneven for the 28-member EU. Official unemployment rates range from 4.7 percent in Germany to 25.6 percent in Greece, with youth unemployment as high as 50 percent in some places.

Experts say how Europe chooses to face up to the mass migration could affect the continent's economic destiny for decades to come, while exacerbating the domestic and regional political tensions that have boiled to the surface since the Great Recession.

The current crisis in Europe is just one facet of a broader upheaval that has seen 60 million refugees around the world uprooted from their homes, up from 37.5 million just a decade ago. Last year, by contrast, only some 127,000 refugees were repatriated to their homelands, a 30-year low.

Even as refugees stream into Europe from Syria and other conflict zones in Africa and the Middle East, the European nations have been slow to respond, experts say.

"Europe had its head in the sand on this. They saw people drowning in the Mediterranean and said, 'yes, that's terrible,'" said Judy Dempsey, senior associate and editor in chief of Carnegie Europe, a branch of the Carnegie Endowment for International Peace. "The reality is Europe has spent 20 years talking about it, but today there is no coherent European Union policy covering migration, even basics like how we define an asylum seeker or a refugee."

Part of the challenge of forming a coherent response to the crisis is that the costs and benefits of absorbing a large number of immigrants vary significantly among the potential host countries.

"For the moment, Germany and Austria have been open to the thousands seeking refuge, but you can't imagine the cost they're facing to do deal with it: translators, temporary shelter, clothes, health care and, of course, the longer-term issues of education, permanent housing and employment," Dempsey said.

Germany, which expects to see 800,000 asylum seekers and other refugees by year-end, has already committed as much as $3.7 billion annually to help them assimilate. And that figure could more than double by 2019, according to an estimate from Germany's Ministry of Labor and Social Affairs.

Yet Germany, where there are many foreign workers in low-wage sectors, may also see the influx of immigrants as a way to compensate for its aging workforce and low birth rate. The Wall Street Journal reports that Germany's social welfare system last year posted a $22 billion surplus thanks to a revenue windfall from the 6.6 million foreign workers already paying into the system.

"Germany may be compassionate and caring toward refugees. But they are also calculating and smart about their own needs," said Farok J. Contractor, professor of management and global business at Rutgers Business School. "This wave of immigrants is relatively well educated, enterprising, persistent and physically strong, and it helps fulfill [the Germans'] need to inject youth vitality in their culture as well as their consumer base."

In the less prosperous Central and Eastern European countries, by contrast, the immigration wave has the potential to cause political and economic disruptions as countries tighten entry restrictions or even seal their borders altogether.

"There is a nontrivial risk that such practices will escalate, thus effectively undermining the European common market that is founded on the principle of the free movement of goods and people," Tsveta Petrova, an analyst with political risk consultancy Eurasia Group, said in a note.

Within Europe, the strongest opposition to European Commission proposals on how to share responsibility for taking in immigrants comes from Hungary -- the scene of chaos earlier this month as desperate Syrian refugees tried to enter Germany and Austria -- along with Czech Republic, Poland and Slovakia.

Historically, these countries have little direct experience with people from the Middle East and North Africa, Petrova wrote, citing their poor track record integrating poor, ethnic minorities. Many in this part of Europe see a flood of non-Christian migrants as a threat to their cultural identity and values, as well as a strain on the public purse.

"Currently, the emigration is occurring against the backdrop of high domestic rates of unemployment in most European countries outside of German," Gary Bosworth, an expert on fiscal and monetary policy with the Brookings Institution, told CBS MoneyWatch. ''Hence it will be difficult to employ the emigrants, and there will be social consequences of increased competition for jobs."

The primary risk that poses is that "it will heighten the domestic political conflicts and opposition," Bosworth added.

Across Europe, the Syrian refugee crisis has become a lightning rod for political debate, posing risks even for popular leaders such as German Chancellor Angela Merkel. And in countries such as France, Greece and Hungary, the issue is proving a boon for nationalist parties both through rising support by voters wary of immigration and by spurring incumbent governments to align with right-wing elements on the issue.

Jocelyne Cesari, a visiting professor at Harvard Divinity School and an expert on the challenges countries face in integrating immigrants, acknowledges the potential benefits for nations of adding labor, especially as aging societies grapple with how to support costly pension and health care systems. But the tangible economic benefits must be weighed against the complex and unpredictable social dimensions inherent in immigration.

"No doubt, expanding the work force is a great opportunity, but we know from history that we don't fully anticipate the cultural, linguistic and religious challenges to a successful integration," she said.

Cesari added that Europe's fractured response to the arrival of immigrants fleeing war, persecution or poverty is problematic. "We need a coherent and unified response," she said.

That response, Cesari warned, has to avoid putting the immigrants into ghettos and must waste no time in getting immigrant youth into local schools. "The sooner they are integrated into the local culture," she said, "the better."