Daniel John Hannan Member of the European Parliament for South East England

While urging its member nations to constrain their expenditure, the EU is simultaneously demanding that they cough up more in order to proselytise for the deeper integration. A new million-euro fund has been established to “develop a sense of active European citizenship” .

Politicians generally, and Eurocrats especially, tend to overestimate the effect of propaganda. Hundreds of millions of euros are spent every year on trying to convince school children, university students, professional organisations and NGOs of the merits of Euro-federation; yet almost every referendum throws up a “No” vote. Then again, propaganda is only the secondary function of these grants; their primary purpose is to provide a living for their recipients. And this they do very well.

Contribution originally posted by Daniel Hannan on his Blog for The Daily Telegraph (post of the 24th of August 2010), quoted here with kind permission.

Professor Richard Rose
University of Aberdeen

The tension created by forces pushing and pulling in opposite directions can lead to equilibrium or disequilibrium. The growth of problems requiring collective action above the level of national governments is creating pressures to upload more decisions to the EU level. Simultaneously, EU institutions face demands to download decisions to national governments and electorates. If these demands cancel each other out, there is a risk that the EU maintains an equilibrium based on all talk but no action. If both forces are strong, the result will not be the end of the EU, but that it can lead to fragmentation into coalitions of the willing and of the unwilling.

 The EU is now but one player interacting with states and markets on other continents. What was once a European Common Market is now a global market. The exchange rate of the euro is established by trading in New York and Tokyo as well as in Frankfurt. While the EU may control trade among member states, it depends on the World Trade Organisation and bilateral agreements with other major economies to regulate global trade. At the international conference on global warming held in Copenhagen the countries that counted most there were the United States and China. Insofar as EU institutions become more engaged with other continents, this adds a level of governance more distant from Europe’s citizens. The appointment of Lady Ashton as the EU’s High Representative for Foreign Affairs and Security Policy is unlikely to alter the EU’s capacity to influence global issues.

Many collective action problems facing the EU divide member-states. On national security, there are not only differences between NATO and non-NATO members but also differences of opinion among EU countries that are members about the desirability of following American leadership in actions outside Europe. More than one-third of the EU’s members are not part of the eurozone and the euro fluctuates against the pound and the kroner as well as against the dollar and the yen. Within the eurozone, fiscal practices vary greatly and so do national interests. On the cultural front, tensions arising from an influx of immigrants from other continents are much stronger in Western Europe than in Eastern Europe.

Within Europe the old idea of integration by stealth or by the accumulation of overspills is no longer adequate. Traditional deference to elites has been replaced by a priority for democratic representation at all levels of politics. Giandomenico Majone argues that the European Central Bank’s Faustian bargain of giving priority to output effectiveness without popular inputs is no longer effective. He asserts, ‘Elected policymakers are able to provide the necessary political counterweight to the central bank’s technocrats; this is impossible in the EU, where the European Central Bank operates in a political vacuum’.

EU enlargement from 6 to 27 members has done more to increase diversity than unity. The failure to achieve major reforms of EU institutions before enlargement has made decision-making more cumbersome. The backsliding of Bulgaria and Romania on intentions for reform illustrates the EU’s inability to enforce acceptable standards of governance on states once they have become members–and this problem can be found with regard to some older member states too.

Differences of opinion within the Council of Ministers rarely involve 26 countries opposed by a single member. They more often reflect differences between groups of states. They can reflect divisions within old and new member states, between financially stronger and more vulnerable states and within the eurozone and between it and those outside it. Rhetoric can provide a political cover to obscure differences, but it is insufficient to justify EU measures on the grounds that one size fits all 27 member states.

 The logic of an EU with members having heterogeneous characteristics and differing policy preferences is a system in which national governments can opt in or opt out of proposed new EU policies according to whether they and their electorates see them as consistent with their national interests. The principle of subsidiarity provides a justification for downloading decisions to national governments that are directly elected and have more resources in relation to their population than do EU institutions. The vagueness of the principle of subsidiarity makes it well suited to an EU discourse in which politics consists of bargaining about what is and is not embraced by terms such as social cohesion and solidarité. The Lisbon Treaty contains formal procedures for national governments to challenge the Commission’s exercise of powers.

 The German Constitutional Court has declared that it would only justify EU measures that it found consistent with German constitutional law, because the EU is not a properly democratic institution. European Court of Justice decisions voiding national regulations about the labour market as obstructing the development of a Single Europe Market have been described by Fritz Scharpf as ‘pushing against the limits of justifiability’ by usurping responsibilities of nationally elected parliaments.

They create, he charges, a situation in which ‘open non-compliance is a present danger’. Scharpf’s remedy is that such contentious decisions should be subject to challenge by the Council of Ministers, because its members are nationally elected.

Bringing the people into debates on policy is an extreme form of downloading policy. Many proposals are regularly brought forward to ‘tighten the reins’ linking European citizens with the EU policy process. Commission efforts to reach out to civil society organizations often embrace Brussels-based ‘astroturf’ organizations rather than grass roots representatives.  The Lisbon Treaty authorizes a European Citizens’ Initiative demanding that the European Commission (2009) give an opinion about a specified policy issue. For the Initiative to be accepted, it must have one million verified signatures from at least one-third of the member states. To file an Initiative will require trans-national organization and activities costing many millions of euros.

The French and Dutch referendums on the European Constitution let out of the bottle the genie of popular legitimation of EU decisions. However, Euro-elites have no policy for constructively dealing with this issue. In the words of the Charlemagne correspondent of The Economist, they are ‘not people who hate democracy but people who equate national democracy with selfishness and populism’. The Irish solution–to tell the electorate to vote again and give the right answer–can hardly be applied to France or Britain. The europhile British Liberals have agreed with anti-EU British Conservatives to an Act of Parliament requiring a national referendum on future EU treaty changes. This is easier to defend in the court of public opinion than Prime Minister Gordon Brown signing the Lisbon Treaty in the absence of the consent of the British people as well of the other 26 European signatories.

The logic of centrifugal pressures is an increase in a la carte policymaking. This permits enhanced collective action among a hard core of member states who see advantages in common policies, unhindered by crippling concessions or vetoes by other member states. It can also satisfy countries where national interest and current EU interests are not fully aligned. For example, David Cameron has already given public support for closer co-operation of Eurozone members to deal with the financial meltdown of Greece–as long as it leaves Britain out.

 The direction in which a la carte policies lead depends on the choice of metaphors. The mathematical metaphor of variable geometry is consistent with the maintenance of a European Union that can accommodate sets of actors heading in different directions according to the issue at hand. The metaphor of a two-speed Europe is about tempo, not direction. It is a leaders-and-laggards model predicting a process of ongoing integration in which member states move at different speeds. There is, of course, a third alternative: a European Union whose members are going nowhere while the rest of the world moves on.

Dorothee Bohle
Central European University, Budapest

Perry Anderson once called the European Monetary Union a revolutionary project. This is for two reasons. First, by making price stability the single obligation of the European Central Bank, and committing members to budget discipline, the Union puts pressure on states to dismantle their inherited systems of social protection, and on organized labor to submit to competitive wage setting. Second, by elevating the ECB high above national electorates, the new currency is entirely separated from broad political accountability and popular-democratic processes. These two aspects are closely related: at its core, the Monetary Union is a project which calls on market forces in order to discipline societies who in the eyes of their leaders have pushed too far in their demands on the state, and it aims to do so by taking crucial aspects of socio-economic governance out of the democratic arena.

How far have the members of the eurozone embraced the revolutionary prospect they signed up to? In retrospect it is obvious that during the first decade of the Union’s existence, Europe has not really been in a revolutionary mood. Although retrenchment has taken place, the welfare state has not been sacrificed on the altar of monetary stability. European institutions were also ready to bend the rules of Maastricht in order to accommodate state behavior inconsistent with the Treaty. Rather than enforcing fiscal and wage discipline, European authorities moreover tolerated the building up of major imbalances. Far from being a disciplinary force, markets themselves were happy to finance growing imbalances, unsustainable levels of debt, and asset bubbles as all of this provided them with handsome profits.

The Greek crisis has given European governments pause. Confronted with an unprecedented attack of the markets which almost made the euro collapse, they agreed on two issues. First, in a heroic act, they set up a stabilization fund which allows to cover the debt servicing need of highly indebted eurozone countries. Second, deadly frightened by the prospect that the rescue effort sends the wrong signals to the markets, governments and European institutions have also committed themselves to finally live up to the spirit of Maastricht. With breathtaking speed, a European elite consensus is being formed according to which EMU members need to trim their public sectors and retrench welfare programs targeting the long-term unemployed, families with children, and pensioners. A framework of multilateral surveillance is being set up, which will monitor member states’ fiscal and macroeconomic policies. Countries that fail to meet the Maastricht criteria are bound to face sanctions. In the words of Commission President Barroso there is a ‘silent revolution’ going on in European economic governance.

While revolutionary indeed, it is difficult to see how the new EMU can work. A continent which in order to satisfy financial markets, is collectively engaged in an austere race to the bottom will have a hard time to ever escape its economic troubles. Simultaneous budget cuts of the dimensions currently envisaged are likely to lead to a downward cycle of slower growth, reduced revenues and new budget cuts. Moreover, the tasks ahead are posing formidable challenges to European democracies. The sheer magnitude of fiscal retrenchment is putting governments at loggerhead with their electorate. The silent federalization of fiscal and macroeconomic policies is only to increase the stress democracies are being exposed to, as governments are becoming unable to bridge the gap between their European obligations and the demands of their citizens.

Can anything be done to set the Monetary Union on a less revolutionary path while coping with the fallout of the financial and Greek crises? There is no doubt that a sustainable Union will require a more coordinated approach to fiscal and macroeconomic policies. It also needs to address the imbalances between creditor and debtor countries, and will have to find a way back to sound public finances. What has to be discussed, however, is how economic growth can be restored, and how the burden of adjustments shall be distributed.

A fundamental condition for restoring growth is to disarm the ticking “debt bomb” underlying most of Europe’s economies. It is not clear why the burden should be shouldered entirely by European societies. Instead, a burden sharing scheme with the states’ creditors could be sought, which would allow to reduce sovereign debt to manageable levels. While creditors would get back much, they do not need to get back all of what they lent.

Second, in order to address the huge imbalances, debtor countries should have to adjust as well. For instance, rather than focusing uniquely on restoring national competitiveness, wage formation could be coordinated in such a way that countries that have been engaged in excessive wage moderation in the past commit to a period of faster-than-productivity-growth wage increases to provide for much needed markets.

Third, the federalization of socio-economic governance should not be allowed to happen behind the scenes. This is the moment to bring politics back in. The current austerity wave is said to be necessary in order to satisfy markets. But there is frightening little debate about the fact that the packages violate basic norms of social justice, as they put an overly large burden on poorer strata of society, while those groups who already profited most from the past boom years are being largely spared. More generally, Europe needs a new debate about how much it wants to allow markets to determine the fate of its citizens and countries.

Josep M. Colomer
Higher Council for Scientific Research (CSIC), Barcelona

For a long time, analyses of the institutional framework of the European Union have remarked its dual condition: while the predominance of the European Council and the Council of Ministers, both formed basically by representatives of the state governments, corresponded to an old diplomatic or intergovernmental model, the increasing powers of the directly elected Parliament and the increasing accountability of the Commission sketched an innovative parliamentary regime. According to some prospects, further progress in democratization of the whole institutional structure would imply the establishment of decision rules more attuned to the typical parliamentary formulas in most member states. While the United States of America is the paramount example of a ‘checks and balances’ regime, usually and confusedly enough called a ‘presidential’ regime, a more consolidated European Union would take the alternative path of a large scale ‘parliamentary’ regime.

The recent enforcement of innovative institutional provisions in the Lisbon treaty might have dismissed this vision. In the new framework, a key figure seems to have appeared with the introduction of a permanent, full-time and long-term Presidency of the European Council, which is likely to become the actual presidency of the Union. If some implications of this hypothesis were confirmed, the tension between the Councils, on the one side, and the Parliament and the Commission, on the other, would have ceased to imply a choice between two qualitative different institutional models, but could produce a dual executive formed around the Presidency of the Council and the Presidency of the Commission. The new European Union would have adopted an intermediate formula between presidentialism and parliamentarism, close enough to certain traits of the semipresidential formula, as established, most prominently, in France.

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Some crucial elements of this discussion emerged during the deliberations of the European Convention gathered in Brussels in 2002-2003. Two basic proposals were expressed.

First, there was the proposal for a parliamentary regime, mainly supported by the parliamentarians of federal parliamentary Germany and the small and peripheral states, by which the chief-executive would be the president of the European Commission elected by the European Parliament. It logically implied a politically weak, rather ceremonial chair of the European Council, which was just an unregulated meeting of the heads of government or state.

The second proposal was more presidentialist. It was promoted by the chair of the Convention, Valéry Giscard d’Estaing, who had been president of semipresidential France and the actual creator of the European Council. The president of the European Council would become the “highest authority of the Union”, while the president of the Commission would become a secondary, subordinate figure, to be appointed by and made responsible to both the Parliament and the European Council.

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The Convention considered several formulas at different stages. The turning point was the Franco-German agreement in January 2003 by which Germany accepted a long-term president for the European Council in return for France backing a Commission president elected by the European Parliament. In order to limit the Council president’s powers, and in contrast to Giscard’s initial proposal, it was agreed that this president would not have his own cabinet. At the same time, the president of the Commission would be elected by the European Parliament “taking into account the elections” for a period of 5 years. As Giuliano Amato, vice-president of the European constitutional Convention, expressed it on the last day of their work, “I have defended the two-headed Europe, but no animal can live with two heads for too long.”

For many years, the Parliament and the Council had different political party majorities due to the tendency in elections for the former to vote against the incumbent domestic governments and the latter’s composition based on those governments. This ‘cohabitation’ induced the formation of broad coalitions, with some variation depending on the subject matter, but in many cases including the Socialist, the Liberal and the People’s groups. However, since the elections in 2004 and 2009 there is a center-right majority, which is basically made up of members of the People’s and the Liberal groups, in the Parliament, the Council of Ministers, the Commission, and the European Council. The typical situation of ‘divided government’ or ‘cohabitation’ has been replaced with a consistent dominion of the center-right through the institutions. In this context of ‘unified government’, as usually happens in France and other semi-presidential regimes, the most concentrated figure, that is the Presidency, tends to become dominant. In the new institutional framework of the EU, the new figure of the European Council President might take a stronger role of political initiative, somehow making the Commission and its president his collaborator, rather than an independent figure, and reducing the role of the Parliament, at least for a while.

Peter Mair
European University Institute

Since the institution of direct elections in 1979, the European Parliament has grown in a variety of ways. It has grown first in terms of sheer size, in that, with 736 members, it is now one of the largest democratic parliaments in the world. Second, it has grown in terms of weight, in that it has now acquired substantial co-decision powers and has become jointly responsible for most of the decision-making that occurs at the European level. As Simon Hix et al put it some time ago, ‘the European Parliament has evolved from an elected consultative body to one of the most powerful elected assemblies in the world.’ Third, it has grown in terms of control, and has now quite a substantial say in the formation of the European executive, the Commission. Finally, it has grown in terms of coherence, in that the party groups have become stronger and more generously funded, and in that the MEPs are now almost all elected through a more or less uniform proportional procedure that privileges party representation. Perhaps ironically, however, this steady accumulation of these various powers and resources has been accompanied by a steady decline in its popular standing, support and legitimacy. In other words, more powers for the Parliament have been associated with more widespread popular disengagement from the Parliament.

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So what can be done to reverse this depressing trend? One option might be to assume some causality, and hence to reduce Parliament’s weight in order to lend it greater legitimacy. That is, powers could be taken away from the Parliament in the hope that this might encourage greater citizen engagement. Since the perception of the democratic deficit appears to have grown step by step with the growth in the weight given to the Parliament, one might even go so far as to abolish it altogether in the hope that this might reduce the deficit completely. But this is unlikely, and the causality assumption is in any case implausible.

The other option might be to try to shift the powers and their parameters in the hope of promoting a different and perhaps more tangible institution that might offer a better focus for citizen engagement and participation. This seems a more easily managed strategy, and it might begin with an adaptation of some of the specific growths indicated above.

First, for example, the size of the Parliament might be reduced. Having more than 700 members might facilitate full cross-national representation in the committees, but it makes for a clumsy, unmanageable and disparate plenary. It also overloads the parliament with anonymous MEPs. Why not reduce the number to 400 or even 300, making it a much more selective and also a leaner and meaner body, and one that might also allow a more focused presentation to the outside world. In this model, each member state would be entitled to a minimum of, say, two seats, and all remaining seats would be allocated across the European population as a whole in roder to ensure equality of representation.

Second, the powers of control over the appointment of the Commission might be reduced or even abolished. These powers could and perhaps should be left to the member state governments to defend, and in any case, for all the Parliament’s claims, the process is already effectively managed by these governments and their parties. Without this appointment oversight, the Parliament could concentrate on what it does best, which is legislation and policy-making. In other words, reform the institution in the direction of a proper legislature, which also means keeping or even strengthening the co-decision powers.

Third, push further towards a uniform voting procedure, but organize it through single member districts rather than list PR. Take power away from the national parties, which in any case often abuse both the electoral process and the election debates by playing the second-order game, and encourage instead a greater sense of territorial representation in, and identification with the Parliament. Each district in Europe – large districts, to be sure – would then have its own representative in the Parliament, and would have a direct and fully accountable channel to EU decision-making. Existing parties would of course also use these channels, but they would no longer enjoy an easy monopoly of the representative process, while other, newer, more European-wide parties might well emerge from the legislative coalitions formed by the individual legislators.

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Any reforms in this direction would, of course, bring the European Parliament closer to the model of the US House of Representatives. But that may not be a bad model for the Europeans, and in this case it would be based on a more meaningful 5-year electoral term. It might also lead to the emergence of more high-profile MEPs, and, possibly through that, to more electoral competition and to more citizen engagement.

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