This article was published by GAS (Socialist Action Group, the ISp affiliate in Romania) on January to take up issues related to the discussion around the dubbed “federalization of Europe”. We present a translated and slightly edited version
The discussions around the federalization of Europe returned to the agenda aggressively at the end of 2025 as a result of the panic and the proposals for strategic reorientation of European capital in the face of competitiveness and geopolitical crises. The report regarding the “future of European competitiveness” associated with Mario Draghi, is being integrated into the agenda of EU institutions. It is designed to function as the framework for this reconfiguration: it proposes massive investments, industrial coordination and shared capabilities at the continental scale.
At the same time the openly federalist current, (namely the UEF and associated publications) is explicitly pushing for going beyond the limits of current EU treaties and for an institutional change that would, according to them, make a merging of the national states into a common continental structure possible. In the liberal-technocratic camp federalism is being repackaged as “pragmatism”, as a doctrine of “functional federalization” meant to deliver results in investments, industry, defense and decision-making.
In Romania these debates are echoed in competing movements: (a) on the one hand,the political establishment is trying to adapt the pro-EU discourse into the new CSD (competitiveness, security, defense) framework, and (b) on the other hand, the right-wing national sovereignty movements counter that peddling “regaining control” by the national state as a universal solution to crises, war and bureaucratization, which in practice only protects the power of the local ruling class over the state apparatus.
The question that we ask ourselves is not “why would the European bourgeoisie want federalization?”, but rather “which factions of the bourgeois want which type of federalization, at what cost and at whose expense?”
We are already on the path towards centralization
When we talk about the centralization of European capital we’re not talking about a future project. That process is already at an advanced stage. The common market has already integrated value chains in a clear direction: production in the periphery fuels accumulation at the center.
Romania produces automotive parts for German and French conglomerates. Workers in the East provide services for Western capital, and the consolidated profits are reinvested in the dominant economies. In the financial sphere, the Banking Union (SSM and SRM from 2014-2015) has already centralized surveillance and crisis resolution, and the Savings and Investment Union (SIU), the successor to the Capital Markets Union, is accelerating capital market integration with the explicit goal of freeing up capital that is stuck in national structures (estimated at 225 billion Euro). In the defense sector common acquisitions, standardization and coordinated industrial capabilities are moving towards the goal of greater coordination of the military-industrial complexes.
Therefore, the logic behind the proposal for federalization is the political and legal formalization of existing relations. This is an essential lesson for any anti-capitalist rejection of a federalist project. That is also connected to the structural futility of the idea to “maintain national sovereignty”. If the value chains, capital flows and relations of production have long since surpassed national borders, an eventual retreat of a member state from the structures of the EU would not by default result in a regaining of democratic control over the economy. In such a scenario under capitalism, we would be instead talking about a transfer of vulnerability: the sovereign state would remain fully subordinated to the market, without the negotiation instruments of the bloc and without the capacity to impose conditions onto transnational capital. The issue is obviously posed differently if a break from the EU is combined with socialist measures that break away from capitalism.
A cartel for survival
Regardless of what the propaganda says, capitalist federalization is not a project for the “unity of the peoples” – split as they already are in the current configuration of the EU by living standards that differ greatly between the center and the periphery, and by wages and productivity locked in structural competition. Even if federalization was practically on the agenda, these differences would not disappear, as the project being pursued today is about raising investment capacity and consolidating the decision-making power of the bloc. This is a purely functional centralization in the interest of capital, not a redistribution that would reverse the center-periphery relationship.
We are speaking, therefore, of an attempted political cartelization of capital in order to raise its organizational scale to meet the true scope of global competition. Such a political cartel is put forward with three main goals:
- Accelerating the centralization of capital though a deeper market union and through the mobilization of funds that the national bourgeoisie of the member states cannot access separately.
The Draghi Report is presented (by the EU institutions that host and promote it) as the answer to the structural economic problems of Europe, of relative underinvestment and of weaknesses in global competition. In the language of class relations this signals European capital’s need for faster and more reliable mechanisms to mobilize money, for a reduction in financial fragmentation and for a channeling of savings towards “strategic” investments as defined by top bureaucrats (industry, technology, energy, defense).
When we hear of “strategic investments” we should thus think of a selection of winners and losers. We should think of the periphery financing the center through value flows, and the center capturing high-margin value chains. A more unified market means more power to financial capital to decide on the allocation of resources at the continental level while it is protected politically through rules and guarantees.
- The disciplining of labor from the center, mainly through austerity measures and structural adjustments that circumvent the mechanisms and procedures of national parliaments and executive bodies.
In any project of capitalist consolidation at the continental scale the hidden question is who pays for the transition. One of the bourgeoisie’s possible answers is the socialization of costs and the privatization of benefits: publicly guaranteed investments, private profits, and the bill pushed onto workers through labor market reforms and a reduction of social expenses (public healthcare, education etc).
The “top-down” form matters because it weakens labor’s pressure points (from trade unions to pressure during electoral cycles) by transferring decision-making onto technocratic mechanisms. At the same time it normalizes depolitcization by spreading out responsibility throughout the bureaucratic apparatus: “we don’t want to, but we have to”, “it’s not our decision, it’s what the rules force us to do”.
- Accelerated militarization through a continental military-industrial complex, as well as a relative autonomy to the US inside the NATO bloc – this last one providing more negotiating power against the American bourgeoisie.
In the contemporary federalist debate the integration we hear about is, aside from the economic aspects, one of institutions and power. It is often argued in favor of by appeals to “emergency” and “security”.
If “pragmatic” federalism means delivering operational capability, then defense and the defense industry become an inevitable pillar: common procurement, standardization, production capacities, logistical infrastructure, and (especially given the erratic policies of the Trump administration) a more formidable negotiating bloc with Washington.
The winners of the new transition towards a federal Europe would be decided by the logic of class and the industrial structure of the continent. The larger economies with already robust defense industries and the capacity to secure major contracts (France, Germany) would have a structural competitive advantage because they already have the fixed capital, suppliers, know-how and an advantageous political position at the center. Peripheral states like Romania would most likely be pushed into the role of low-wage subcontractors making low value-added components, or of markets financed through state budgets.
An impossible or reactionary project
Lenin warned as far back as 1915, writing on the “United States of Europe” in the context of the imperialist war, that such a structure is “impossible” (due to the inter-imperialist competition and the contradictions between national bourgeoisies) or “reactionary” (if it appears as a cartel agreement against the proletariat and against external rivals).
Why reactionary?
Currently reactionary does not simply mean conservative, but anti-worker by definition. An overarching capitalist institutional arrangement can refine and extend the judicial, police, surveillance or military coercive apparatus, elevating the management of social conflict by the bourgeoisie to the continental level. It will have the aim to stabilize the conditions of accumulation, meaning it can facilitate the transfer of the costs of the crisis onto labor.
Imperial plunder, in the current context without formal colonies, includes preferential access to markets, export of capital, control of supply chains, trade and sanctions regimes, energy and logistical positioning, as well as the capacity to impose rules in favor of your own corporations. The rivals are other blocs or powers capable of contesting these positions (mainly China and to a lesser extent the USA), and competition manifests through standards, technologies, finance, routes and spheres of influence.
Why impossible?
Even if a part of capital “wants” federalization, the bourgeoisie is not a unitary subject, but rather a collection of factions with different interests and anchored in different state apparatuses; hence the differences in strategy. What is called “Europe” is, under capitalism, a common market tensioned by states that remain instruments of power for nationally dominant capital. That points to the impossibility of the bourgeoisie to ever fully overcoming the national state, all attempts in this regard leading to an economic integration without overcoming the national interests of capital.
From this results a pattern that we’ve seen repeatedly: partial progress (in areas where capital has an immediate common interest), followed by blockages, vetoes, exceptions and conflicts about who pays and who controls.
How we should position ourselves
- The rejection of capitalist federalization must target its substance, not merely its form. Attempts at “federalism” that serves the competitiveness of capital, the disciplining of labor and militarization is not internationalism, but rather a reorganization of European imperialism into a more efficient form.
- Right-wing sovereigntism is the other side of the coin: if capitalist federalism seeks to centralize the bourgeoisie’s power at the continental level, sovereigntism seeks to keep (or reinforce) it at the national level. In both cases workers are asked to align themselves to the interests of “the Homeland”, regardless of whether that homeland is Europe or a member state, in other words to the interests of the ruling class. From the sovereigntist camp we can expect attacks against unions and collective bargaining under the pretext of “national competitiveness”, a demonization of migration and of cross-border solidarity, as well as the use of anti-EU rhetoric in order to mask an internal redistribution in favor of local capital.
- The supra-structural form is not the core concern for labor. For workers the main issue is not if the exploitation takes place under a European flag or a national one. What matters most are wages, the length of the work day, housing, access to public services, trade union rights, ending austerity (including that camouflaged as modernization), and, of course, control over production and of society. This calls for true transnational action: connecting struggles in similar sectors, synchronized labor strikes, as well as cross-border political and trade-union movements.
- Putting forward the struggle for a Socialist Federation of Europe. If we accept the diagnosis that capitalism cannot produce a stable democratic unification, and the experience of the past few decades shows us that capitalist integration produces austerity and militarization, then the only coherent option is the conquest of power by the working class and a democratic federation of worker’s states.
How can this be achieved starting from our current situation?
- by building worker’s centers of power in the workplace: militant unions, committees and structures capable of a real economic blockade;
- a set of demands that link the immediate defense of existing rights in the face of capital’s assault with a rupture with capitalist private property: democratic ownership and control of key sectors, the socialization of the financial system, needs-oriented planning;
- Through actual internationalism, starting with joint statements and materializing in the form of an infrastructure of solidarity between workers (funds, common campaigns, coordination of actions and strikes);
- Through a rupture with the political blocs of the bourgeoisie (be they “pro-European” or sovereigntist) and the forging of a political force of labor that has a real capacity to intervene in social and political struggles.
The recent worker’s offensive in Europe, such as the first European conference for the coordination of dockworkers in their refusal to load weapons shipments destined for Israel, convened by the dockworkers of Genoa in September 2025, gives us reason for optimism in this sense. In this example, workers from across the continent, from Marseille to Piraeus, coordinated actions to block ships that were transporting weapons, established a common alert system and promised simultaneous labor strikes in case of an attack on the Sumud flotilla. This type of transnational coordination demonstrates in practice that workers can overcome borders when they set common priorities and real communication structures.
