This crisis will not undermine the EU - but nor will it strengthen it much

It is perhaps the most worn-out cliche in Brussels that European integration proceeds from crisis to crisis. But it is one that most Europhiles repeat with pride. They point to the economic mess of the seventies that led to the creation of the single market; the Balkans wars that started the common foreign and security policy; eastern enlargement that led to the constitutional treaty. Union itself was born out of the destruction of war. For the European Union, crisis often truly means opportunity.

Yet it's hard to watch the ship of the EU, navigating the waves of the economic crisis slowly and sluggishly as big ships tend to, without a sense of trepidation. It is not always clear who is in charge and whether its lofty pronouncements will come to much. Might not the strains of the Great Crunch lead its member states to turn inwards, adopting nationalistic policies that undermine the single market and stretch its institutions to breaking point? People have even started discussing the previously unthinkable possibility of the break-up of the eurozone should a large member state (read Italy) default on its debt. Some worry that the institutions of the EU have not kept up with the integration of its markets and are no longer up to the task of managing the beast. Certainly, there is little Brussels can do where this war is won or lost: the cleaning-up of the banking systems and the boosting of demand. Those are national competences and so, it seems, this is a crisis that every member state has to manage largely on its own. As Zsolt Darvas, an analyst at Bruegel, the Brussels think tank, points out, the EU is largely absent even in the coordination of fiscal stimuli many governments have launched. Instead of turning the crisis into an opportunity and becoming stronger in the process, the thinking goes, the EU might become less relevant.

In fact, the EU has been doing quite a lot. It has helped bail out Latvia and Hungary, two formerly profligate states that nearly went bust last year. It has doubled its balance-of-payment facility to 50bn euros should more states need help. The EU's investment and development banks have funnelled money to Eastern Europe's shaky banking system. Its paymaster, Germany, has promised to save any country in the eurozone that faces bankruptcy, a possibility the EU's treaties formally reject. Interbank lending in the eurozone is now largely run through the European Central Bank and the euro, a mostly untested currency, has so far stayed rock solid in the face of the storm. In fact, its pull has become stronger than ever: even proudly independent Scandinavian states, including non-EU member Iceland, are now aspiring to its safe harbour.

It is true that the vocabulary of economic nationalism has seeped back into politicians' pronouncements. No doubt there have been cases of protectionism, most notably in bank bailout packages that forced bankers to concentrate on their domestic markets. But there is little evidence so far that the single market is in fact under strain. The European Commission says it is looking at the state aid given to banks and other corporations by governments and that some might have to be paid back later. And unless the recession deepens severely, which at this stage is admittedly difficult to rule out, it is unlikely any eurozone government will default on its debt. Few seriously think the eurozone might break up. Its members have long since passed the point of no return. The structure is holding. If anything, the crisis illustrates its strenght.

But if so far there is little sign of deepening divisions within Europe as a result of the crisis, there are equally few hints to suggest that a great leap forward might follow the storm. There is talk of a single European banking regulator. The euro's reputation may strengthen. Perhaps even the Irish, staring economic collapse in the face, will change their mind about the new EU treaty they rejected last year. But even the streamlined institutions it offers cannot fundamentally change the inherent slowness of an organisation with so many members.

The reason for this is that Europe may be reaching the end of its capacity to integrate much further. There is little new economic territory for the EU to conquer without seriously infringing on the sovereignty of its members. Even the constitutional treaty, the last breath of European federalism, in reality more institutional streamlining than grand reform pact, recognised this. Calls for a single fiscal policy to complement the single monetary arm are unrealistic. There will not be a real federal budget any time soon just as there is no possibility for a strong and truly democratic EU government independent of the member states. Leaders, who tend to be too young to remember the second world war, that prime motivator of integration, have lost the zeal for federalism. Europe's citizens have never really had it. New measures will be more about strengthened cooperation than common institutions.

Unless the crisis worsens dramatically, it will not wreck the EU. But neither will it propel it to dramatic new heights. The organisation will muddle through, as it always does. But it won't look very different from how it does today.