Leaders across Europe were quick to say they would do whatever it takes to fight the coronavirus a few months ago.
But as reality sinks in, with growth collapsing and national budget deficits reaching levels not seen before in peace time, we need to ask what can be done at a supranational level and will it be enough to hold together a diverse set of nation states?
Never let a good crisis go to waste
Following the old adage, European integration typically jumps forward when the Union is under stress. And this time is no different: the support package negotiated by European leaders late last month is worth up to €540bn (4% of EU GDP).
Some of the measures would have been hard to imagine not too long ago, for instance, the common backstop for national unemployment schemes and the opportunity to tap the European Stability Mechanism without extensive conditionality - turning it partly into a joint bank account dedicated to health care.
However, European integration typically is also characterized by kicking politically difficult questions down the road. Indeed, the recent fiscal deliberations have not (yet) made much progress on a European Recovery Fund, meant to promote areas of the Union most affected by the pandemic.
Many perceive this effort as essentially a Marshall Plan 2.0, albeit based on internal rather than external resources.
For comparison however, the first Marshall Plan would currently be worth a bit less than 1% of EU GDP after adjusting for inflation whereas whisper numbers for the size of the ERF range between 3.5% and 10% of EU GDP - making it definitely a major milestone.
Moreover, the devil is, as usual, in the detail: just as back then, there is a vivid discussion on whether the funds should be available in loan or grant format.
On the monetary side, the European Central Bank (ECB) has substantially reduced the cost of borrowing for banks and upped its asset purchases by € 870bn to ensure appropriate monetary conditions across the eurozone.
Yet, while the institution repeats that it stands ready to do more if needed, it has shied away from an open-ended commitment to bail out governments, a general inclusion of high-yield assets in its purchase programs, and a relaxation of the capital key constraint for its purchases, at least ex post.
Covid-19 is pushing the limits
Already, things are starting to creak at the seams. While Covid-19 is indeed a symmetric shock, the impact is not, and some countries and regions are harder hit than others.
The recovery fund can only work if it does not have a major impact on fiscal sustainability as the hardest-hit countries tend to also be those with weaker fiscal positions.
And as far as we can tell, the ECB cannot continue to purchase sovereign bonds in the current country mix without hitting the capital key limits soon.
In addition, rating agencies have just recently provided shots across the bow of Italy, but more countries are at risk.
So why not get on with the reforms needed? The sticking point is, as usual, around who picks up the tab. In a re-run of the 2011-12 events, the region appears to be splintering into "frugal" and "spendthrift".
This is a superficial and misleading characterisation: a country that looks good on paper but, for example, exports into regions that are hard hit by the crisis will want to help those regions to help itself.
Unity at this point is not a question of giving money away with more or less strings attached but a question of helping other member states to get up such that all can stand together.