Seven Euro-Heresies

A French friend, puzzled by Britain’s behaviour in the European Community, recently resorted to an alarming metaphor. ‘It’s as if you had boarded the plane without checking where it was bound for – and now you keep trying to divert it, or jump out in mid-air.’

He could have been more scathing still. Had the British realised that it was a plane they were boarding? Or had they imagined it was a terminal building? ‘Thus far and no further’ has sometimes seemed their unspoken assumption. In the early Seventies, British ministers made much of the ‘larger market’ Community membership offered. Twenty years later, the ‘single market’ was the slogan – shorthand for the removal of non-tariff barriers among the member states, due to be completed by the end of 1992. What always appeared to be lacking was some coherent vision of the Community’s future beyond a perfected customs union – even, at times, any inkling that European integration was an open-ended process, not a finite product or a limited goal.

It was not that the Community’s spokesmen, advocates or analysts had ever disguised its ambitions. In 1962, when Edward Heath was first negotiating terms for British membership, one of his French interlocutors – later a minister – made the point in words reminiscent of a British Army marching song. ‘We don’t know where we’re going,’ he said. ‘All we know is that we’re going there together.’

‘Ever closer union’ was the nearest the Rome Treaty came to defining the Community’s objective; and for a long time every member state could interpret the phrase as it liked. Each was inclined to see a united Europe in its own image. Britain and France, highly centralised countries, feared a monolithic Community; Germany and Italy, with strong regional traditions, saw it as a congeries like themselves. The Benelux countries, some cynics added, looked on it in mainly mercantile terms. The Americans, meanwhile, seemed to believe that Europeans were enacting a slow provincial production of scenes from the early history of the United States.

Gradually, however, the Community’s incremental nature became clearer and its future shape better-defined. The European Parliament, once a mainly toothless watchdog, was soon directly elected and given more power. The independent Commission, whose main task is to propose policies for adoption by the national governments represented in the Council of Ministers, recovered with Presidents Roy Jenkins and Jacques Delors the degree of prestige it had had under its first President, Walter Hallstein. The Council of Ministers, in which General De Gaulle had tried to preserve the national veto, voted more often by majority – sometimes against British protests, but sometimes encouraged by Britain to outflank opposition elsewhere. And the European Court of Justice, always the most ‘fundamentalist’ of the Community’s institutions, continued to pile up case law which deepened the merger of national sovereignty.

The fact that the Community represented a process, not a product, was made more explicit in February 1986, when its 12 member states signed the Single European Act, beginning to streamline the Community institutions with a view to achieving the ‘single market’. It became more obvious still in December 1991, with the two new treaties signed at Maastricht and now in the process of ratification.

Broadly, these provide for a European Political Union and an Economic and Monetary Union. Their specific commitments are less grandiose, in the short term, than these titles might seem to imply. But they contain enough, already, for the hard-headed Economist to have called the result ‘federal government’. They give the European Parliament the right of veto over some Community legislation. They extend the Commission’s term of office to five years, to coincide with that of the Parliament; and although Commission members will still be appointed by the national governments acting together, this will follow investiture by the Parliament – thus possibly foreshadowing embryonic parliamentary government. On matters of substance, the Community’s scope is redefined and enlarged; Community citizenship is established; a common currency will begin to be adopted by the end of the century; and a common foreign and security policy may in time lead to a common European defence.

No wonder, perhaps, that die-hards in Britain blanched at the Maastricht agreement – and that the British Government came home brandishing its two ‘opt-out’ clauses, one on the common currency, the other on the ‘social chapter’ of the text. On currency, it was agreed that Britain would not adopt the single currency without the consent of the Westminster Parliament; on the ‘social chapter’ – labour legislation – an elaborate procedure was devised whereby 11 of the 12 countries in the Council of Ministers could adopt such measures as a minimum wage or minimum working hours, while Britain ‘sat out’ like an Ugly Sister at Cinderella’s ball.

Some of the British press hailed the opt-out clauses as a great victory for Britain’s diplomats. In a sense they were: the other countries needed no reminding that John Major had a general election in front of him and a nationalist Mrs Thatcher close behind. But if in the short run the opt-out clauses largely silenced the Thatcherite opposition, in longer perspective they were a triumph for humbug.

No one had ever supposed, that is, that any country in Europe would adopt the single currency without the consent of its national parliament. Britain’s special concession, in other words, was counterfeit from the start. More damagingly still, few experts believed that if the major European countries adopted the single currency, Westminster would long think it safe or expedient for Britain to stand aside. That opt-out clause was doubly phoney.

The ‘social chapter’ opt-out was almost certainly just as much a fake. The arguments for it were weirdly contradictory. One British minister, interviewed on the BBC’s Radio 4, actually claimed in two successive sentences that stricter wage and working conditions would both increase unemployment and cripple industry because more people would have to be employed. One could hear his dismay as he realised what he was saying: but the slow-witted interviewer failed to pounce. What does seem likely to pounce is the European Court of Justice. If, as some British ministers claim, the ‘social chapter’ puts Britain’s Community competitors at a disadvantage, how long are they going to tolerate unfair competition without taking Britain to law?

Still, all’s fair in love and elections: so these taradiddles may perhaps be ignored. What are harder to stomach are the seven heresies now being put about in the hope of diluting or diverting the Community, now that it’s clearly becoming more than the mere market that British minimalists and Thatcherites hoped it would remain.

1. ‘The end of the Cold War has made the Community obsolete.’ On this reckoning, uniting Western Europe was mainly intended as a bulwark against the Soviet Union. ‘The economic arm of Nato’ was how some Cold Warriors described it; and that view undoubtedly made some headway in the United States. In Europe, it was sometimes shared in Moscow, and to a lesser degree in Bonn: but like most slogans it was grossly oversimplified and partial. In so far as economic integration increased Western Europe’s prosperity, it underlined the contrast between Western affluence and Eastern penury: but that was only a by-product of the Community’s major aims. The first, undoubtedly, was to reconcile France and Germany and prevent the renewal of war – a task so long achieved as now to seem unnecessary. The second, no less urgent, was to heal Western Europe’s economic divisions and prevent a relapse into protectionism – a danger still potent today. The third reason for seeking to unite Europe was to match the economic strength and political influence of the superpowers, including that economic superpower, Japan. The subtraction of one superpower from the global equation makes no essential difference. And it may be that a united Western Europe will be better able to help the Commonwealth of Independent States than a collection of nations could.

2. ‘The break-up of the old Soviet Union and the Soviet bloc shows that nations are preferable to plurinational giants.’ Why, say adherents of this heresy, try to unite Western Europe when Eastern Europe is rediscovering the delights of diversity and national independence? The assumption behind the question is a false analogy between East and West. The Eastern bloc, and in some degree the Soviet Union itself, were not voluntary associations of like-minded countries, but an empire held together by hegemony. Even if one country in the Community – Germany – is economically the most powerful, it is in no sense the Community’s ‘leader’. The checks and balances within the institutions and their voting systems are designed specifically to maintain equality among all the Community’s citizens, whatever their nationality. Nor does the Community attempt to suppress diversity: it thrives on it. And the future may yet show that the Commonwealth of Independent States will itself need a degree of unity greater than it at present believes.

3. ‘The Community should be enlarged as soon as possible to include the whole of Europe.’ The subtext to this statement is: ‘That will prevent over-centralisation, because so many states could not be dominated by Brussels bureaucrats.’ The immediate question is: do Brussels bureaucrats really dominate anyone? And the answer is: ask the French. If ever they start complaining, then others should worry. As for the Community’s enlargement – the orthodox response is: ‘Yes, but it must be strengthened.’ And the reality? Governments will be slow and reluctant to enhance the power of institutions, however many would-be new recruits knock at the door. Conclusion: be wary of too much speed in welcoming new-comers. As Kingsley Amis said in another context, ‘more will mean worse.’

4. ‘Federalism – which Britain’s partners wished to enshrine in the Maastricht agreement – would involve giving more and more power to Brussels.’ Instead, say British anti-federalists, ‘subsidiarity’ should be the rule. In saying so, they betray their ignorance. ‘Subsidiarity’ and federalism amount to the same thing. Both prescribe that power should be exercised at the appropriate level, not all gathered at the nation or the Community, but spread down to regional and local authorities where they are big enough to cope. Too many British spokesmen use the word ‘federal’ in a distorted, American sense – as in ‘Federal Bureau of Investigation’, where it implies the central power. In Europe, as in Germany, ‘federation’ means the opposite of the unitary state; and when Continental Europeans speak of the Community’s ‘federal vocation’, as they would have liked to do in the Maastricht documents had Britain not objected, they mean an association of independent states which pool their sovereignty only to the degree that they have to in order to act as one when unity matters.

5. ‘Yugoslavia has shown Europe’s impotence.’ In the first big challenge to the Community’s joint foreign policy, on its very door-step, say its critics, it has proved itself incapable of effective action. Perhaps: only the future can reveal conclusively. At present, the latest near-ceasefire seems to be holding; and the recognition of independent republics, far from exacerbating the conflict, may well have assisted peace. But what seems certain is that individual national action by the Community’s member states would have been less effective than their joint démarches; and that individual action by Germany alone could have been dangerously misunderstood. If, finally, the Community’s critics cite Yugoslavia as yet another instance of history’s now favouring the small, as against the big battalions, then the answer is the same as to the comparison with the Soviet Union: there is a world of difference between unity imposed and unity freely sought.

6. ‘In the current depression, membership of the European Exchange Rate Mechanism is a straitjacket strangling British industry.’ The subtext in this case is: ‘Devaluation would make Britain competitive.’ Well, debate is still possible about the level at which sterling entered, or should have entered, the ERM. Permanent overvaluation of a currency is a recipe for economic hardship, to say the least. But if the debate is about the desirability of fixed exchange rates with the possibility of variation (the so-called ‘crawling peg’), then the answer must be that stability is of great value, and worth paying quite a price for. Even if devaluation did not put up the cost of imports (which it must, defeating part of its own object), the continual depreciation of a currency simply passes poverty on to posterity – unless it be used quickly, as a chance to improve productivity and become competitive again. Otherwise, devaluation risks being a free ride – downhill. And if a one-word answer to Britain’s plight made any sense at all, that word would have to be ‘investment’.

7. ‘Europe’s future Central Bank must be democratically-controlled.’ In other words, elected politicians must decide its policies, not appointed officials. This last and apparently minor heresy may be the most seductive of all. Who can doubt that a Central Bank with so much influence over the lives and fortunes of more than three hundred million people should be controlled by those people’s properly elected representatives? In one sense, at least, no democrat could disagree. The Bank’s scope, and role, and funds, and statutes, must surely all be determined by governments: and so they will. What is in question is its day-to-day operation. How far, here, should governments restrain their natural desire to meddle? How far should financial considerations, not political expediency, dominate what the Bank does? The best answer, surely, must be: ‘As much as possible, in both cases.’ What matters to Europeans, as much as anything, is the stability of their wealth. Political distortion – to help a region, a group, or a category – should be undertaken deliberately, by other bodies such as a Regional Fund or an Investment Bank. If not, the line between democracy and demagogy can become dangerously thin.

Further scrutiny of political speeches will no doubt reveal other heresies, especially in an election campaign. What unites the seven listed above is a last-ditch effort to resist the movement that is already carrying the European Community well beyond the simple single market. This is no moment to quarrel with the flight plan. Fasten your seat-belts.