Johannes Becker said the EU will face “strong resistance” from European publics if it presses ahead with plans to centralise more and more power in Brussels.
The top academic, who is director the institute for public economics at Münster University, said there are “limits” to how much federalisation people will accept.
Chief eurocrat Jean-Claude Juncker, in lockstep with French president Emmanuel Macron, has put forward ambitious plans for a superstate including a eurozone budget and EU army.
The pair want Europe to develop its own common immigration, asylum, diplomatic, defence, labour and taxation policies in a concerted drive for a federalised post-Brexit EU.
But speaking at a Centre for European Reform event in Brussels today, Professor Becker said that whilst certain “technocratic” tweaks may pass unnoticed many of the proposals will rile voters.
He said: “The EU is based on the subsidiarity principle, which you could operationalise like we should centralise as much as necessary and decentralise as much as possible.
“This is based on the implicit assumption that we can centralise as much as we want. I think there are limits to this.
“In recent years we’ve learned that there is not only the need for cooperation but we have strong national or even regional identities if you look to Catalonia, Scotland, and national identities like Poland, Hungary, but even Italy, France, Germany.”
He warned eurocrats: “And if we try to centralise in the presence of these strong identities this may in a way backfire.
“Centralisation in the presence of these national identities, there may be from the start strong resistance against this centralisation. The tasks that are centralised may have less support than before.
“We can see that centralisation works well with more technocratic tasks like banking regulation, competition policy and even monetary policy although of course this is a highly political task.
“It works less well with the tasks that are more associated to national identities like labour market policies, redistribution and fiscal policies. Centralisation may be good as an idea, but it may not be as easy as is sometimes assumed and this half-hearted, half-way centralisation may backfire.”
Professor Becker predicted that as a result plans for a eurozone budget, designed to help bailout banks and even countries in the result of a future financial crisis, will be watered down.
He said: “My prediction given that there are limits to centralisation is that this common budget will be rather small, that it cannot be used for mitigating idiosyncratic shocks.
“There will be strictly proportional use across countries that means Germany and all other countries will make sure that they get their part of the money back.
“And there will not be political support of using this money when a big shock occurs and the money should be concentrated on a specific region in the eurozone, and this is due to a lack of a common idea and a lack of political support that could be the basis for centralisation.”