European Union-A Disaster in the Making
The political recovery of Europe since 1945 has been a story of unprecedented success. Communism has been brought down, and without a shot, let alone the sort of all-out war that earlier had been required to defeat Nazism. Democracy, where it existed already, has been strengthened; where it did not exist, above all in Germany and Italy, it has struck deep roots. In Britain and France, the loss of empire has led not to revolution and ruin but to higher standards of living. No West European country has serious irredentist claims upon any other, and external threats are more imaginary than real.
And yet, instead of consolidating and enjoying these gains, the entire continent is in the grip of uncertainty and rising instability. Once again, as between the two world wars, ordinary people face a restructuring of the whole European order which they are virtually powerless to affect. The cause of this self-inflicted crisis is European integration, a fraught and long-drawn-out process now inescapably coming to a head.
The West European countries are already taking measures to “converge” their economies according to what were originally quite strict criteria. This is a preliminary to the next step: as of January 1, 1999, all national currencies are to be replaced with a single European currency, to be known as the Euro. “The coining of money,” in the words of William Blackstone, the founding father of jurisprudence, “is in all states the act of sovereign power.” A common currency is inconceivable without common political institutions to support it, and these common institutions are the end toward which Europe is moving.
Down the centuries, the shifting relationships of Britain, France, Italy, and Germany have determined Europe’s fate. Now, through the apparently benign and thoroughly boring technicalities of a common currency, a new relationship is struggling to be born. The final goal is a choice among several potential forms of political federation, some loose, some tight, the most grandiose of which is a United States of Europe. But if any one of them is to become a reality, the historic nation-states of Europe will have to surrender their sovereignty, and change out of all recognition.
Partitioned throughout the cold war, Germany was “one nation, two states.” Every German government had the long-term objective of reuniting the two states. French foreign policy, by contrast, looked upon partition as a lasting and valuable constraint on German power. What the French were afraid of was a revival of “European” ambitions on Germany’s part of the kind they hoped had been defeated in World War II. In 1950, a left-wing French deputy, Francois Billoux, spoke for many of his countrymen when he said, “Europe was Hitler’s idea.”1
But there were others in France—Jean Monnet and Robert Schuman most notably among them—who clung to an old, prewar conviction that only genuinely supranational institutions could keep the peace in Europe; and as West German economic power grew by leaps and bounds in the 50′s and 60′s, French policy began to reverse itself. With growing panic, successive French governments sought to create the common institutions which might permit them to share in the gathering strength of Germany and, who knows, even direct or surmount it. By 1962 General de Gaulle was explaining to his colleague Alain Peyrefitte that European integration was the means by which their country not only could “prevent domination by the Americans or the Russians” but could “become what she has ceased to be since Waterloo: the leading power in the world.” Germany, it was clear, needed friends, and its chastened postwar mood also held out the hope that a constructive relationship with other European powers would preclude further warfare.
From small acorns great oaks do grow. One Franco-German initiative led to another, and one treaty to the next. The result was the European Economic Community, which became the European Community, and is now the European Union (EU), a supranational construction of a type never before seen. In addition to France and Germany, its fifteen countries include Italy, Britain, Ireland, Spain and Portugal, Denmark and Sweden and Finland, the Benelux nations, Greece, and Austria. About the same number again—mostly in Eastern Europe but also Israel, Morocco, and Turkey—seek terms for membership or association. Norway, Iceland, and Switzerland have chosen to stay out.
Admission has been an erratic process. Those already inside have demanded their pound of flesh, while petitioners must decide what and how to pay. Once in, member governments have bargained fiercely for “opt-outs” and “derogations” without which they would never have been in a position to jump through the hoops of the next stages of integration, as called for in the series of treaties that culminated in the Maastricht Treaty of 1991.
That treaty commits the European Union to a single foreign policy, with a single defense policy to follow, and to a common citizenship with rights and obligations still to be defined. The agreed single currency, the Euro, is to be managed from a new European central bank, in Frankfurt, which will control the gold and dollar reserves of all countries in the EU. (This means that no country could again finance a war in its own interest, as Britain did in the Falklands in the early 80′s.) The bank will also set a single continent-wide interest rate, the effect of which will inevitably be to benefit some regions and industries and hurt others. On the central-bank board will sit former heads of national banks, now reduced to the role of national spokesmen.
Such is the forum where the interests of member countries of Europe are to be fought out. What this will be like in practice can be observed in the institutions already operating in Brussels, the capital of the EU. To anyone brought up to value democratic essentials like the separation of powers, checks and balances, and accountability, today’s European Union is a bewildering improvisation imposed from the top, without the legitimacy conferred by popular consent. Its supreme body is the European Council, consisting of the fifteen heads of state or government, who meet two or three times a year for private discussion behind closed doors. Councils of Ministers then convert the ensuing agreements into policy.
These Councils consist separately of the ministers of foreign affairs, finance, transport, social affairs, and so on of their respective countries, and they too meet at regular intervals. Each such Council enjoys both executive and legislative powers, and may, in the words of an authoritative work on the EU,2 “convene in any configuration it chooses.” The same source goes on to observe that the individual Council “remains the most secretive as well as the most powerful of the institutions of the Union”; it is the only legislative body in the democratic world which meets and deliberates in secret.
The legislation generated by this process is then passed to the European Commission for execution. The Commission consists of a president and twenty commissioners, who are appointed to office and cannot be dismissed. They divide among themselves portfolios for trade, agriculture, the environment, and so on. Under them are some 20,000 bureaucrats who enjoy, again in the words of the same authority, a “unique combination of administrative, executive, legislative, and political activities and responsibilities.” As a civil service, the European Commission is in fact unique in two respects: it may initiate and pass legislation, and it is accountable to nobody and nothing but itself.
In Brussels, some 700 standing committees do the work of government, of which about 400 are meeting on any given day. Decisions may be taken according to several different procedures, but the most usual involves what is called “qualified majority voting”—a euphemism for horse-trading and rigging.
Still another body is the European Court of Justice, or ECJ. This was set up with the specific mission—a political mission, not a judicial one—of furthering the ends of European integration. Commission and Court together are empowered to promulgate law through a variety of instruments, including regulations (which are absolutely binding on member states), directives (also binding but allowing each nation to implement them in its own way), recommendations, opinions, and resolutions.
Finally there is the so-called European Parliament, with some 600 members. Elected in their own countries, usually on a list system or by proportional representation, they really represent only themselves. European-wide parties do not exist. Without genuine legislative or even revisory powers, and hobbled by the official recognition of eleven different languages with all the attendant difficulties of interpretation and translation, the Parliament is a figurehead in the style of the Russian Duma. Its energies are devoted, in vain, to the wresting of power from Council and Commission.
In this state of things, “Europe” still has no sovereignty, in the true meaning of that word, but is rather a stew of German federalism, French dirigisme, protectionism, corporatism, and mass welfarism—all enshrined in an Orwellian language naturally known as Eurospeak and intelligible, if at all, only to the presiding Eurocrats. Key phrases such as “subsidiarity,” “proportionality,” “non-paper,” “engrenage,” and “co-decision procedure,” as well as acronyms like Coreper and Ecofin, hide the human reality: here is a set of rules whose whys and wherefores can neither be anticipated nor readily grasped but from which there is no appeal. The Eurospeak for that is “democratic deficit.”
This whole structure arose within the confines of the cold war, which imposed limitations of its own on the European political scene. At least as long as that conflict lasted, the notion of an eventual political integration seemed to most European countries a secondary consideration, even chimerical, and whatever was happening in Brussels appeared to escape close analysis. Even so, however, the mounting costs of Brussels soon loomed larger than any benefits.
On the one hand there was the single market, designed to facilitate the movement of people and goods and to encourage free trade; to this, all could assent. But on the other hand there were such things as the Common Agriculture Policy (CAP) and the Common Fisheries Policy (CFP), which, as even the commissioners in charge were forced to agree, were open-ended disasters. Without regard to cost, every profession, trade, and industry had to adapt to standards dictated by the bureaucracy in Brussels, and this created a paradise for lobbyists and special-interest groups, as well as big businesses with enough clout to obstruct competitors. Intervention-buying led to surpluses: the notorious mountains of European butter and lakes of European wine. Impenetrable to the outsider, and all in Eurospeak too, a highly complicated system arose to block the free market through all manner of subsidies, grants, quotas, transfer payments, and special funds. Inventive command-bureaucracy like this is a novelty in the free world.
During the 80′s, the project almost strangled to death in contradiction and red tape. The media and the public began to mock the weighty decrees from Brussels dictating the exact bulge of a strawberry, the precise degree of straightness of a cucumber, the impermissibility of a double-decker bus. No satirist could have had the inspiration that, in the name of free trade, animals and even plants should be obliged to have passports, or that whole breeds of dogs might be suppressed on account of the shape of their nose and the texture of their fur. (Canine racism!)
And then in 1989 the cold war came to its abrupt end and every supposition changed. Margaret Thatcher, then the British Prime Minister, and President François Mitterrand of France were quick to perceive that a new balance of power had emerged. Increasing its territory by 40 percent and its population by 25 percent, Germany was back in size to what it had been before World War II, and Russia was no longer there to provide a counterbalance. For the first time in its history, Germany could now settle relations with the rest of the world peacefully and on its own terms. As for the United States, successive American administrations, though they no doubt thought the prospect unlikely, had always argued in favor of German unification, and President George Bush waved it through without a second thought.
Chancellor of Germany since 1982, Helmut Kohl was convinced that he was the man fitted to shoulder the responsibilities of the new situation. A more dependable ally of the United States than his immediate predecessors, Kohl conceived of Europe as a bloc in the making, and he was able to push through his idea from a position of economic and political strength. By means of the Maastricht Treaty, he proved himself far and away the most influential politician anywhere outside the United States. Maastricht may be seen as the European treaty that was never signed after the conclusion of the war; it is, to the contemporary order of Europe, what the Versailles Treaty was after World War I.
But why should anyone want this new arrangement? Why should the Germans, of all people, want it? The guilts and atonements of Nazism are on the ebb; the German constitution, the Bundesbank, the deutsche mark are rightly seen as solid achievements. To surrender these things for the sake of Europe must seem an almost saintly act of abnegation, if not of national martyrdom.
And Germany also has its hands full at the moment. At the time of reunification, East Germany was reputed to be the tenth or perhaps eleventh largest economy in the world; in fact, it was a bankrupt rust-belt whose goods were fit only for a command economy. With East German industry uncompetitive, much of it simply closed down, raising unemployment to 30 percent or more. Since then, sums on the order of 100 billion marks have been transferred every year from West to East to pay the costs of reunification, and some experts calculate that twenty more years of such payments will be necessary.
Germans, in short, have already found it hard and expensive to integrate with other Germans. Unemployment stands officially at 4.7 million—about the number just prior to Hitler’s takeover—and this figure is almost certainly understated. German wages are already the highest in the world, and taxes and social charges add 90 percent to employment costs. Moreover, Germany’s difficulties have had consequences for other countries in Europe, which, given the criteria imposed by the goal of a common currency, have had to adopt the high German interest rate and have suffered deflation and recession for their pains.
To Helmut Kohl, however, these are only trifles on the way to the goal of integration. Where Bismarck united Germany by force, he is determined to go one better—to resolve the German question by uniting all of Europe, and with strokes of the pen rather than the sword. The reason, he maintains, is that aside from the manifest good that is to be found in federation, his countrymen must be tied, locked, bound, embedded, and contained. A strong Germany needs weakening, not only to appease its rightly anxious neighbors but for its own sake.
At times Kohl even invokes the threat of a resurgent German nationalism, with all the fears this specter can arouse in Europe. In February 1996 he warned that “the policy of European integration is really a question of war and peace in the 21st century.” A policy paper issued by his party was even bleaker: “If European integration were not to progress, Germany might be called upon, or tempted by its own security constraints, to try to effect the stabilization of Eastern Europe on its own and in the traditional way.”
To be sure, it is possible to argue—as some of Kohl’s critics do—that he cannot be sincere. Is all this not just a brilliantly expedient dressing-up of German imperialism as altruism, taking measures calculated to achieve supremacy under the pretense of forgoing it? But Kohl is no conspirator. Like many Germans of his generation, he genuinely conflates nationalism with Nazism, and therefore believes that nationalist sentiment has to be submerged and then suppressed by means of a supranational structure. Kohl’s rigid conception of ultimate European union is the price to be paid for his rigid conception of the German past.
In any event, the German chancellor insists on pushing through his policy no matter what political and economic realities might suggest. The slightest postponement of the timetable will, he prophesies, wreck the peace of Europe, and there can be no turning back “unless we wish to challenge fate.” In this he is seconded by the new President of Europe, Jacques Santer of Luxembourg, to whom any resistance either to the Euro or to the timing of its introduction is the work of “pessimists against whom I declare war.” Under pressure, they and their officials also mutter that the Euro will enable Europe to resist the dollar, as if that were self-evidently a sensible thing to do.
Others, however, hold a different view of these matters.
Germans themselves have become increasingly nervous and doubtful about the rewards that will crown the sacrifice asked of them. Why, they have begun to ask, should they incorporate into the hard mark a number of soft currencies debauched by unscrupulous foreign politicians? Do they really have to pay for inherent economic backwardness or mismanagement elsewhere in Europe? Why must they placate the whole range of eager supplicants and subsidy hunters—backward peasant farmers, industries protected from competition by socialist governments, inefficient producers and retailers in other lands?
In a recent survey, 79 percent of Germans said they wanted a referendum before going farther, and the same survey indicates that the outcome of such a referendum would be close, with only 43 percent in favor of abolishing the mark and 44 percent against. In another poll, only 14 percent of German businessmen believed that monetary union would be beneficial to them, and 55 percent expressed doubt. It cannot reassure the Germans that opinion polls in Spain, Italy, Belgium, Ireland, and elsewhere show large majorities there in favor of monetary and political union. These populations visualize European federation first as an escape from their own internal weaknesses and then as fairygold prosperity, backed by all that good German discipline and hard work.
In France, a number of intellectuals and politicians are now saying openly that Germany has grown into the outright winner of World War II, while France has been revealed as the outright loser. For such people, only the capture of the mark can halt the German drive to power, and gain the French a disproportionate influence in the order set up by the Maastricht Treaty. When President Mitterrand consented to hold a referendum to approve that treaty, he, like other European leaders in the same circumstances, went to extreme lengths to fix the result; nevertheless, he obtained national assent to its terms by less than 1 percent. President Jacques Chirac is not prepared to allow either a parliamentary vote or a referendum on the next steps toward union. Polls, however, show that the country is split down the middle. Unemployment running at 12 percent and deflation, which many Frenchmen see as German-led, are causing demonstrations and low-level violence, of which foreigners are usually the victims.
The British, albeit acrimoniously, have gone along with the drift of things over the years, while unilaterally opting out from particular EU policies they have not liked or have been unable to keep. One of these was the Exchange Rate Mechanism, or ERM, the prototype of today’s Euro-convergence criteria. On Britain’s entry to the ERM in 1990, the pound was overvalued against the mark and the money markets could not take the strain. The government of John Major had no choice but to abandon the ERM regime altogether in 1992, and other countries then followed suit. The surviving inner group of France, Germany, and the Benelux countries, bogged down in the recession brought about by their collective monetary policy, remains resentful of what looks like Britain’s lucky escape (and of its current economic well-being).
Since then, arguments for and against the Euro and ultimate federal union have engaged British politicians and businessmen in fierce hand-to-hand combat. Opinion polls reflect public awareness of the upheavals in store. In 1995, 61 percent were voting to stay in Europe, 29 percent to leave; by early 1997, only 42 percent were voting to stay in and 38 percent to leave (20 percent were undecided). In the run-up to this May’s general election, most Conservative-party candidates declared themselves against the Euro and other obligations under Maastricht, and in this respect at least they seemed to have the agreement of British voters, some two-thirds of whom were now expressing the wish to have no more European integration.
Mainly, however, British policy toward Europe has been marked by hypocrisy. The assumption is that union is anyway impossible, and federation an idle dream, so that the prudent thing is to stand aside as the project sleepwalks to its doom. But what if, instead, it comes into being? Although a recent government White Paper asserted that even within a federal Europe, Britain would remain an independent nation-state, both major political parties tacitly concede that this cannot be true. Sizable minorities seem to believe that in the end Britain will take a Churchillian stance, and back out of the European Union altogether. Yet these political minorities have also remained comparatively silent, even as Britain’s national interest, its identity, and the whole reading of its history hang in the balance.
In the meantime, every European country, Britain included, already has two heads of state—its own and the EU president, Jacques Santer—two capitals, two parliaments, two flags, and, above all, two systems of law: national law, and the law decreed by the European Court of Justice. In 1990, a British judge in a British court ruled that entry into the Union (then still known as the Community) under the terms of the previous Treaty of Rome had indeed meant that “Parliament surrendered its sovereign right to legislate contrary to the treaty on the matters of social and economic policy which it regulated.” And those “matters” are constantly proliferating. Mutually reinforcing one another, the European Council and the ECJ decree continually enter new fields, fortifying the Maastricht order and steadily diminishing the place of national law.
The war of laws has brought the rule of law in Europe altogether into disrespect. European elites increasingly treat public life as a vast patronage system, there for the plundering. National courts now hear scandalous cases in which heads of governments, ministers, leaders of industry, parliamentary deputies, even the one-time Secretary General of NATO, are charged with theft of public funds, profiteering from office, and even murder—yet somehow the prison doors never quite close on them. In all of this, Brussels sets the pace.
For Brussels with its bureaucracy is an extraordinary swamp of systemic fraud and crime. The total EU budget is 55 billion pounds (approximately $89 billion), for which there is no proper accounting. Perplexed auditors admit that in 1995, the last year for which official figures exist, almost $10 billion disappeared through corruption and mismanagement, and between 4.3 percent and 8.5 percent of the budget was lost through error (no attempt is made to explain why the margin is so wide). According to unofficial sources, a quarter of the EU budget goes missing somewhere in the channels of disbursement. Like the old Soviet nomenklatura, the bureaucrats award themselves tax-free salaries and privileges. None of this, however, concerns the ECJ, which is too busy promulgating new law to prosecute violations of the old.
No wonder, as the outlines of a supranational Europe become visible, that another law—the law of unintended consequences—has begun to make itself felt. As the nation-state surrenders to something larger than itself, it is leaving behind a vacuum, and ethnicity is filling that vacuum fast. A number of European countries contain ethnic minorities; claiming to represent these minorities, small groups have started movements of “national liberation” on the third-world model. Rejecting assimilation as “oppression,” they resort to terror. Basques in Spain, Flemings in Belgium, the IRA in Britain, Corsicans in France, all threaten the social and political cohesion of their respective nation-states.
As ethnic consciousness rises, so does its counterpart, nationalist xenophobia. Nobody knows the figures for sure, but in Europe there seem to be around twenty million immigrants, legal and illegal. Almost without exception, those legally in Europe have rights equal to those of native citizens. In the main they have arrived from Africa and the Muslim world, and lately from the former Communist bloc as well. Popular opinion often blames these foreigners for diluting the old identity of the nation-state.
Historically, the nation-state has satisfied but also controlled nationalism, which otherwise builds up like underground gas, to explode when it can. The Maastricht order, however, encourages the build-up of noxious pressures. If national parliaments and institutions no longer represent the sentiments of large numbers of people, some of them will make up for the “democratic deficit” in the only way available, through new political formations and parties which express and give form to their grievances.
Nationalist, willing to be strong-armed though not exactly fascist, these strange new groupings—the Northern League in Italy, the Flemish Bloc, the National Front in France, Jorg Haidar’s Austrian Freedom party—are the inadvertent products of the European Union, which after Nazism and after Communism is the latest would-be usurper of national sovereignty in Europe. They have been capturing ever-larger shares of the vote, up to a third in some elections, and they have prospects of power. And there may be worse to come. Historians unanimously maintain that the reparations imposed on Germany by the Treaty of Versailles gave rise to a German desire for revenge and helped make Hitler possible. What will the backlash be when Germans come to believe that the dissipation of their economic strength to other countries is a policy of reparations in a new form?
Motivated by emotional and ill-considered attitudes to the past, lured on by the mirage of a Grand Design, the Kohls and Santers and their kind are embarked upon a utopian experiment which is mustering the very same destructive forces it claims to be eliminating. The national interests of Britain, France, Italy, and Germany remain what they were. On the day these interests collide, there will be nothing except the Euro and a half-formulated anti-American ideology to hold together the artificial scaffolding that is Brussels, and ward off a general collapse in anger, disillusionment, and violence.
1 A new book by John Laughland, The Tainted Source (Little, Brown, London), elaborates informatively upon what its subtitle calls “The Undemocratic Origins of the European Idea.”
2 The Penguin Companion to European Unity by Timothy Bainbridge with Anthony Teasdale (revised edition, 1996).