When I first came to Brussels as a MEP in 1994, with a positive, if critical, view of the EU, I found the rhetoric of the federalists astonishing, not only in its flights of idealistic fervour, but also in its disdain for the affinity which ordinary people had all over Europe for their regional and national loyalties. We were, it seemed, to ditch these deeply held loyalties and ingrained traditions for some kind of European super-soup, because we should “transcend” mere national loyalties for a greater goal of unity. They seemed to think one only had to demonise nationalism for it to fall away and be replaced by the European project. I thought then and still think now that it is pure folly to promote the idea that federalism in Europe means ditching one’s own national allegiance.
Such thinking is to put the cart before the horse; much more realistic is the idea of building a common Europe from the base of our own experience and affinities, sharing what is positive in our cultures with a common goal of mutual prosperity and peace, and the recognition that together we are stronger and more able to deal with the challenges of globalisation, climate change and environmental destruction, than separately.
The limits of federalist idealism
Are a national and a European allegiance incompatible? Most Europeans clearly do not think so. From the Irish perspective a strong national identity and allegiance and a strong European allegiance are completely compatible.
But to succeed in creating a genuine, democratic Europe, peoples’ national allegiances cannot be seen as something to be dismantled, which would arouse defensive fury, but as something to be built on for the common good.
In some cases, however, this (almost ideological) federalist’s idealism, seems to stem from the dislike some have for their own national identities, and the need they feel to replace these with a greater allegiance.
In the European Parliament I noticed it was often those whose own national allegiance had been disrupted in some way that were attracted to federalism as an ideal. People from states such as Italy or Belgium, whose own states seemed fractured, or Germany, whose post-war generation sought solidarity beyond the nationalism which had proven so catastrophic.
However, I do not think that we can build a genuinely integrated Europe on these idealistic longings. Rather, one must look to what is needed to solve particular questions at particular times. Especially now, when the Eurozone crisis is threatening to dissolve the Europe so painstakingly built for more than 50 years.
A fractured Europe
Behind the rhetoric of integration we have the reality of a fractured Europe with three obvious fault lines behind which Europeans glower at each other. First, there is the fractious north-south divide: the Northern states such as Germany; France; the Benelux and the Nordics, versus the mostly southern “bailout” states; Greece, Portugal, Italy, Spain and Ireland. Then there are the new eastern states which have their own problematic history and which sought prosperity and stability from EU membership.
Then there is the fault line between the nation state and the EU institutions. This is most strongly expressed in key Eurosceptic states like the UK, but also exists elsewhere (e.g. Ireland) and is getting stronger because of the financial crisis. In order to construct joint forms of democratic economic governance, Europe must articulate a vision that is intelligible to its citizens and with which they can identify.
A European public space
Europe cannot be further democratised without the creation of an effective and open public space. Making the EU intelligible and creating real debate about policy choices could, for example, be strengthened by investing in the Europeanisation of the media. The EU should not aim to create EU media outlets operating from Brussels such as Euro news, but it could try to enhance the exchange of information among media outlets operating in individual Member States by sponsoring websites offering translations of leading articles, subsidising the exchange of radio and TV documentaries or backing a journalistic equivalent of the Erasmus programme. By making the best national television programmes or newspaper articles available to audiences of other countries it will be possible to have more pan-European deliberation, and the scope for national politicians to say one thing in Brussels and another to their domestic audiences will be reduced.
The difficult way to fiscal Federalism
The euro crisis has provoked debate over the quality and quantity of federalism required for the optimal functioning of the European Union. A certain amount is necessary for the monetary union to function effectively but the crisis has also revealed a lack of specifically fiscal federalism—i.e. a common framework for allocating functions to different levels of governance and for implementing appropriate instruments to properly realise those functions. However, the idea of a European Commission role in monitoring macro-economic and fiscal policy (including even possible sanctions from the Court) is proving unpalatable, particularly to the larger member states. Attachment to the idea of national budgetary sovereignty prevents significant progress towards more fiscal federalism.
A monetary, economic and fiscal regime would be a decisive move towards political union, to which many citizens might react negatively. So, what is actually emerging has been described as ‘a system of governance under which debtor countries have to accept fiscal policy prescriptions and structural reforms imposed by creditor countries’ – while the latter remain free to conduct their own policy with no ‘meaningful interference’. There could be an EU polity with a federal core and a single fiscal policy, moving in the direction of political union, surrounded by a group of non-Euro states who may or may not opt in to the core.
The topic is contentious, however: while some believe it is impossible to solve the crisis other than with a further move toward integration, others see the difficulty of persuading voters of this, and others recoil from the goal of political union altogether.
A European federation of nation-states ?
The question of the sequencing of the steps towards further integration has been widely discussed since the publication of the report last year by Van Rompuy highlighting differences of opinion on whether banking, fiscal and broader political union can all progress simultaneously or whether they are inextricably linked and mutually reinforcing. He emphasised the importance of taking a long term view of European recovery, stating that “the crisis has revealed what it takes to be in a Union… If we want investors to buy 10-year government bonds, we need to show them where we want the Eurozone to be in ten years’ time.”
But it is hard to find either the political leadership, or the popular support, to transform the governance of the Eurozone and, with it, the long-term political and economic prospects of Europe as a whole.
One of the most striking features of the debate is the lack of consensus on what is actually meant by ‘political union’. Broadly, it refers to ambitious political integration to a degree that can reflect and support the economic integration inherent in the single currency.
One of the most likely outcomes of the move to political union is the creation of a federation of nation states. This would not amount to a super state, but rather to a democratic federation that can tackle common problems. But this ‘federation of nation states’ may, however, prove unacceptable to some, for example the UK and the Czech Republic.
A federation is not necessarily centralism. It can be based on checks and balances between the member states and an administrative and political centre. However more central control does not necessarily mean more political legitimacy. If Europe moves towards more federalism, the voters must decide, not only a few wise men. We should not allow a federal state to develop without real oversight, representation and accountability.
Federalism and the USA
There are huge problems in taking the USA as a model; many young people perceive it as a corrupt super state where the arms industry and corporate power have a stranglehold on the political system. However this model has been the political subtext of much federalist thinking. The EU is not the USA and will never be. Europeans would be much better acknowledging this. Moreover, the US is currently locked in political stasis as a Republican congress and a Democratic White House have opposing budgetary policies, and neither is able to prevail.
Even in the USA federalisation was a lengthy process – a central bank has only existed for a century, the FBI since the 1930s. Europe begins differently; with a central bank, the European Court of Justice (ECJ) and the Commission and so on, Europe already has federal institutions.
Participation of state governments in federal policymaking can provide an important structural safeguard against federal overreach. Giving representatives of state interests a voice in the federal legislative process puts them in a position to defend their prerogatives against self-aggrandizing federal authorities.
A powerful means by which to safeguard State interests structurally is to represent state governments in a powerful upper Legislative Chamber. This is the approach taken, for instance, in the German Bundesrat. Other structural safeguards may involve giving states a role in the appointment of federal officials, such as federal judges or bureaucrats, or simply over representing small states in the lower legislative chamber.
However the European Council has the major and most visible role in giving the EU political legitimacy. The challenge is to reform the European Council, the body that is most visible and interesting to the citizens, because they feel most connected to their governments and how they represent their interests in Europe. Reform and extension of other bodies may be desirable and even possible, such as the creation of a second chamber. However this will not remedy the political vacuum that exists in the EU. To do this the politicians that have the most legitimacy and visibility – that is, heads of state and government- must operate with more accountability and transparency when sitting in Council and making laws for the whole of the EU.
The EU has extremely powerful structural safeguards. Member State governments are not only directly represented in the EU’s de facto ‘upper chamber’, the Council of Ministers, but also appoint the European Commission President and the College of Commissioners and ECJ justices. And finally, they monitor both the implementation of EU policies by the Commission, through the comitology system, and control the implementation of most policies at the national level.
All these powerful structural safeguards for state interests should make fears of dominance by the centre implausible.
Currently, however, control seems to be being ceded to a Franco-German directorate, much to the dismay of many observers who argue that this could extend to other non-treaty-based cabals. In this way the dominance of the large Member States replaces concerns of dominance by the centre.
A system that works
The EU is not facing an institutional crisis. The EU’s legislative machinery operates effectively and continues to make policy on everything from telecommunications and financial services, to environmental and consumer protection. The ECJ has continued to take a strict line enforcing EU law against errant governments and has expanded the reach of EU law into sensitive areas including health care policy. In short, the EU still functions, and it is extending into new policy arenas despite its crisis.
However, the levels of governance are so complex that they are not intelligible to EU citizens. The experience of federal systems suggests that the cumulative effect of incremental changes may yield significant changes in the division of authority between Member States and the federal system. The EU can only be durable in the long term if its on-going operations encourage behaviours that serve to strengthen its institutional safeguards over time. The Member States need to have incentives to fulfil their obligations to the Union.
The problem that the EU faces is essentially that in order to save the Eurozone it must move to banking and fiscal union. While these may be made palatable to most Eurozone members, it still remains to be seen if a fiscal union, with all the states equally liable to budgetary scrutiny, can be agreed. Even if this can be agreed, fiscal union is really completely unacceptable without more democratic control, leading to more political union.
A tightrope walk lies ahead of the Union, and the drop is steep: along the path to stability and solidarity a plethora of complex systems and divergent pressures must be finely balanced—federalism must incorporate national pride; socio-economic gaps must be sutured; national sovereignty must be played off against a (democratic!) federalism, whilst being wary of tendencies towards centralist domination; and, crucially, the citizen must be kept on board throughout the process. Here, we cannot simply follow the path laid down by others, but must experiment to find our own way. The creation of a public space to articulate a common vision of a balanced, integrated and functioning Union, to be achieved through democratic processes, is the challenge we face: don’t look down!
Thanks to all those who spoke at the Future of Europe seminar in Dublin, especially Elizabeth Meehan, Nicola Liebert, Eamon Ryan, Dan O Brien, Benoit Lechat and Vinay Gupta from whom I have taken much wisdom for this article. Thanks also to Mark Leonard on E.U. structural reform and Linda Barry on fiscal and political union.