Friday, 25 June 2004

Building a political Europe

The policies of the EU’s integrationist Juggernaut for the next 20 years

Dr Richard North  Dr Helen Szamuely 

On Tuesday of last week (25 May), The Times published a story headed “Political union should be the EU’s next big project, says Prodi report”. It referred to a “controversial study” entitled Constructing a Political Europe, apparently arguing that the European Union was in crisis and can be saved only by turning it into a fully fledged “political union”, with a European tax, minimum wage and pan-European political parties.

According to The Times, the report had been written by a “round table” of senior European political experts, including Tony Blair’s adviser Lord Simon of Highbury, the former Trade and Industry Minister, and chaired by Dominique Strauss-Kahn, the former French Finance Minister.

It stated that “Europe is at a turning point in its history”, facing a “triple crisis” of failing institutions, falling democratic legitimacy and not knowing how far it should expand geographically. It insists that the solution is to create a “mobilising myth” or “project”, for the EU and that only the creation of a “common model society” can give it legitimacy.

Despite our best attempts, however, it took us several days to find the report on the internet, not aided by the fact that The Times misquoted the name of the report, which is in fact “Building a Political Europe” – a small but important distinction when using search engines. Even then, there is no access to the report through the official commission Europa website but we have at last tracked it down. Possibly by mistake, it has in fact been published by the European Commission Delegation… to Australia and New Zealand.

A political Europe

Reading the document “Building a Political Europe” was a chilling experience, not least because it made its purpose so clear. It sets out the next phase for the development of a “political Europe”, a template for a European Union after ratification of the constitution. However, in the 112-page document, you had to read to page 98 to understand the overall context.

Here, what emerges – with utmost clarity – is the admission that the constitution is only a first stage of building a political Europe. “Real but limited progress” is the round table’s verdict on that constitution, undeniably an important step forward. But it is not the end of the process. It is the beginning. Read their own words:

the constitution is only a first stage of building a political Europe. Real but limited progress” is the round table’s verdict on that constitution

“The transformation of the Commission into the government of the Union has begun. For the first time, the Commission is losing its political neutrality. From now on its President will be elected by the European Parliament and chosen by the political majority that has won the elections.

And the role of this “president” is clearly set out. “His status will be close to that of the head of government in a parliamentary democracy. His commissioners will no longer be imposed on him by the national governments; he himself will have the power to appoint and dismiss them, and he will thus be able to form his government team and determine the political line to be taken by it. These changes will make the status of the commissioners similar to that of national ministers.

As for the Commission itself, “The Commission’s overall political role will at last be recognised. Whereas under current legislation its role is limited to ensuring the proper functioning and development of the common market; the draft constitutional treaty entrusts it with overall promotion of the general European interest.

The other institutions, writes the “Round Table”, “will also become more political in nature. The President of the European Council will have the task of the external representation of the Union (he will thus be the political face of Europe) and of ensuring that the political guidelines laid down by the European Council are put into practice.”

“The Council will have greater decision-making capacity; the principle of qualified majority voting has been established and the qualified majority threshold has been lowered. “In other words, the Council will become more supranational and less intergovernmental in nature, while the powers of the European Parliament will be considerably increased, in particular through extension of the co-decision procedure and by giving Parliament the ‘final say’ in budgetary matters”.

the Council will become more supranational and less intergovernmental in nature, while the powers of the European Parliament will be considerably increased

However, the report goes on to say, the progress achieved by the draft constitutional treaty is not sufficient to lay the foundations of Europe as a political union. Whatever compromise is reached by the IGC, “this constitutional treaty will merely be the starting point in the transformation of Europe into a political union“. A “second phase” is “both possible and necessary”.

On the front of the document there is the caveat that the report “does not necessarily reflect the views of the European Commission”. Furthermore, the commission, according to The Times “is so worried about the reaction to the report, received officially last week (although it is dated April 2004), that it did not announce its publication” Commission spokesmen have declined to answer questions on it and one EU diplomat said: “It’s living in a fantasy world. This is now the time for a period of retrenchment and calm, which allows Europe to get ahead with things that really matter”.

This notwithstanding, we have been here before. The history of European integration is replete with such reports, setting out objectives which, in part, have been fulfilled but which, at the time, were denied.

This report is not just a Europhile tract, but one initiated by and presented to the commission president and it represents a serious strand of thinking within the “project”. It would be unwise to ignore it, or dismiss it. What starts off being dismissed as fantasy in the EU world has a nasty habit of becoming reality.

Contradictions

But one of the most extraordinary aspects of the report is the fatuousness of the assumptions that underlie it. The self-declared purpose of the report is to chart the way forward in defending something called the European model. But it is written by people (or, at least one person, since it is not clear whether the report is the work of Dominique Strauss-Kahn alone, or if he had the support of the international great and the good who sat on his committee) who have only a sketchy knowledge of European history, and no understanding of politics or economics.

Looking at some of the more blatant contradictions in the document, one sees that:

  • The report bemoans the fact that there is no political Europe in the sense that the Commission, which ought to be a political government, has no power to impose all the necessary legislation to promote “the European model”, which appears to be a highly centralised, bureaucratic, redistributionist, illiberal, inward looking, protectionist administrative tyranny. At the same time, the report makes it clear that the transfer of “concrete”, “technical” powers was essential because there would have been no agreement to transfer political power.

    “the European model”, which appears to be a highly centralised, bureaucratic, redistributionist, illiberal, inward looking, protectionist administrative tyranny

    In other words, the project lacked democratic legitimacy from the beginning, because that was the only way it could be created at all. This lack of legitimacy may now be undermining the whole project.

  • It seems that the European model is rooted in imperial unity, such as Greek civilization and the Roman empire – neither exactly European but Mediterranean and Near Eastern, the various empires of Charlemagne, Charles V and Napoleon, as well as cultural unity like Christianity in the Middle Ages – presumably not when it was causing the deaths of thousands of Christians of slightly other persuasion and the Republic of Letters (what is that when it is at home?). But, apparently, the model is also rooted in the discords and wars and the horrors of the Second World War.

    True enough, but where does that leave the idea of single model?

  • Apart from the guff about inviolability of human rights, multilateralism and culture as a means of emancipation, there is the inevitable contradiction at the heart of the European economic project. The authors of the report proudly proclaim that the European model is a high taxing, high regulation, redistributive one. They are proud of the fact that taxation averages 42 per cent of GDP in Europe as opposed to 28 per cent in the USA and Japan. But, alas, the European project is foundering because of lack of growth and economic stagnation.

    The authors of the report proudly proclaim that the European model is a high taxing, high regulation, redistributive one

    Could the two be possibly connected?

  • Apparently Europeans are proud of the model, which makes “a political Europe as the vector of this European model … legitimate”. The trouble is that equally apparently, there is no faith in the model or support for it as shown by the low turn-out in elections and, it appears, according to the report, a loss of interest in representative democracy by the educated citizens of Europe.

    But as, on their own account, the rulers of the EU have no democratic mandate, loss of interest in their antics hardly betokens loss of interest in representative democracy. Quite the opposite, it may show a desire to return to it.

  • It seems that the European model, which protects its citizens and spreads its wonderful values in the world is threatened from within by economic stagnation and lack of political legitimacy and from without by the forces of globalization and international terrorism. It seems that this wonderful model simply cannot cope with what is going on in the world.

    The one thing we are not told is why, in that case, it should be defended by more taxation, more regulation, more policy that has rendered it helpless and hopeless.<

It is difficult to do justice to all the various contradictions and inanities in the document.

Budgetary federalism

It is impossible, however, to do full justice to a report of 112 pages, offering 50 separate recommendations for building the “political Europe”, but a flavour of the more detailed content can be gained from a passage on “budgetary federalism”.

It asks: Do we want the Union to be genuinely capable of independent financing? In practice, do we want (the European) Parliament to be granted the power to raise taxes?

An then proceeds to answers its own questions:

Unless we give up the idea of any progress towards political union, the answer must be yes.

Addressing this general issue, the “round table” begins by anticipating the outcome of the constitutional treaty negotiations, stating that “The European Union’s powers are being strengthened.” It then concludes that, with these additional powers, “it must therefore be provided with the financial means to act.”

What concerns the “round table” is the current EU budget of one percent of GDP. “The development of a political Union and of the European model is inconceivable”, with that budget, it asserts.

“No federal institution can function with such a limited budget. By way of comparison, the United States federal budget is around 20 percent of American GDP, and the German federal budget is almost 13 percent of German GDP. Due to the severe limitations imposed by its budget the Union is forced to act mainly through legislation, thus creating a kind of regulatory inflation.”

Assuming that CAP spending is reduced, the “round table” considers that an initial increase to between 1.5 and 1.6 percent of GDP could be aimed at, requiring the removal of the ceiling on own resources of 1.24 percent of GDP.

As to financing, some would come from “budgetary transfers from the Member States linked to transfers of powers” and another part would could come from an increase in national contributions.

However, this is not good enough for the “round table”. “If the European Union is to become a political Union, in addition to the existing four “own resources”, it needs a fifth budgetary resource “which would be federal in nature.”

The “natural” candidates are identified as “a supplementary national contribution” of 0.1 percent of European GDP and a three-point supplementary company tax. Furthermore, a company tax would have an added advantage.” The harmonisation or partial harmonisation of the company tax base and rate would be a further step towards completion of the single market. It would make it possible to limit tax competition between Member States, which chiefly centres on this tax.

The harmonisation or partial harmonisation of the company tax base and rate would be a further step towards completion of the single market. It would make it possible to limit tax competition between Member States, which chiefly centres on this tax

Managing the media

One other aspect that deserves special attention in this limited review is the attitude towards the media. Inevitably, any project so ambitious and so grand as turning the disparate nations of Europe into a single nation must have control over the flow of information and the “round table” authors of the report have offered their ideas on the avenues that can be explored.

They set out by complaining, with some justice, that “not enough information on Europe is given to Europeans”. As an aside, there are references throughout to “Europeans” – not the citizens of member states, but always “Europeans” – indicative of the mindset and the aspirations of the authors.

As to the lack of information, they cite the negotiations on enlargement, where they complain that that few “have had enough facts at their disposal to reach an informed judgment”. Poor media coverage of the negotiations and the importance given to the concluding summit, they assert, have given “Europeans” the impression that this change in the scale of Union has been brought about by secretive diplomats conducting behind-the-scenes negotiations.

The national media, they assert, devote scant attention to European political debates because they feel they are of little interest to their readers, listeners or viewers. The national governments’ reading of European affairs reflects national preoccupations first and foremost. Even the European Parliament has often been no more than a sounding-box for national interests.

Taken in isolation, these seem reasonable complaints. This website has made the same observations. However, one must read between the lines to absorb the real concerns behind the authors’ concerns. By “facts”, of course, the authors mean the Community “line”. In their limited view of the world, only the guardians of the faith utter “facts”. The rest is ill-informed speculation and “myths”.

Nevertheless, not all is lost, according to the authors. “The situation is undeniably improving”, they write. All the main national media now have correspondents in Brussels to follow European affairs, and high-quality information is provided by the press agency Agence Europe.

Here, the identification of the Brussels-based Agence Europe is highly significant. This is a highly partisan, Europhile agency, known for its staunch support of the Commission. Not surprisingly, the information is regarded as “high quality”.

But then you get to the real concerns: A “pan-European media do not yet exist. The overwhelming majority of European media are national or local.” That is the real beef of the complaint. The authors want a “pan-European media”, detached from any national base – or readership.

The authors want a “pan-European media”, detached from any national base – or readership

“Those with an audience in Europe”, they observe, “as a whole are primarily international media. This goes both for the press (Financial Times, The Economist, International Herald Tribune, Wall Street Journal) and television and radio (BBC World, Radio France International, Deutsche Welle). Genuinely European media are rare.

Despite observing that there is not yet a market for such organs, the authors argue that “the media are of key importance for the future of European democracy” – i.e., integration. They continue: “The Round Table therefore considers that the Union is justified in promoting the creation of the first pan-European media, on the model of the BBC, as the French and German governments have done with the TV channel Arte.”

“The Round Table therefore considers that the Union is justified in promoting the creation of the first pan-European media, on the model of the BBC, as the French and German governments have done with the TV channel Arte.”

How significant that the authors chose the BBC as a model. A supposedly independent broadcaster, its pro-European Union bias is so evident as to be laughable – but it earns its reward in the portals of the Commission. No doubt if any British government is so rash as to remove the license fee, the EU will step in and offer it a handsome stipend, transforming it into the EBC – the European Broadcasting Corporation.

Worth a look

As indicated in this text, a short review cannot even begin to do justice to this tract – the federalist equivalent of Mein Kampf. As it stands, however, the chances of all fifty of the recommendations being adopted are extremely remote. But, elsewhere in the document, the “round table” suggests a 20-year time-scale to achieve its objectives.

Nevertheless, this year, it is the 20th anniversary of Spinelli’s draft treaty on European Union and, looking at this document then, many commentators would have suggested that its objectives were unrealistic to the point of fantasy. Yet, with the Single European Act, Maastricht, and now the proposed constitutional treaty, almost all of those objectives have been attained.

Given the current rate of progress of the march of European integration, twenty years hence, who is to say that the objectives will not also be attained? It can never be said too often that, when dealing with the EU’s aspirations, what starts off by seeming fantastic has a nasty habit of coming to fruition.

This document, therefore, is definitely worth a look, not least to see for yourself what the federalists dream of when they tuck themselves up at night.

You can find it on:

www.delaus.cec.eu.int/whatsnew/building_a_political_europe.pdf

This article first appeared on the Bruges Group