(4) Perspectives of European Union  - European Union World
EUROPEAN UNION WORLD
(4) Perspectives of European Union
(4) Perspectives of European Union
The Single European Act
A New Direction for European Integration in the 1980s
After the inactivity of the 1970s the dawn of a new decade coincided with internal and external developments that reinvigorated the European project. Japan and the United States were about to embark on a period of significant economic growth, which forced European leaders to streamline their markets in order to improve their international competitiveness. The 1980s also saw a further round of enlargement of the European Community.
Three former fascist dictatorships-Portugal, Spain, and Greece-all sought to anchor their young democracies within a community of stable political systems. Despite the weak economic infrastructure of Greece, that country’s accession in 1981 was handled quite speedily. A little more difficult was the accession of the two Iberian candidates. Specifically, negotiations over Spain’s membership were complicated by concerns expressed in Italy and France, both of which offered the same agricultural products as Spain and feared a significant drop in income for their own farmers once Spanish competitors were also allowed to offer their produce to European consumers. Not until 1986 did Portugal and Spain join the Community. But despite some difficult negotiations, this southern expansion confirmed that the EC had established itself as a highly attractive vehicle for organizing Europe.
Another reinvigorating development was that much-needed institutional reforms had started to have an impact on the European scene. For the first time direct elections were held to the European Parliament in 1979. Although this institution was included in the Treaty of Rome, Members of the European Parliament (MEPs) were previously appointed by national governments. Although 1979 did not see increased powers for Parliament, which only had an advisory legislative function, it did have two important effects. First, it gave a much-needed degree of legitimacy to the European Community that had been lacking before. This in turn attracted political actors who had previously not found the European Parliament an attractive proposition. New people with greater political ambitions and capabilities gave the Community a new dynamic and added a further source of political pressure to reinvigorate the European project.
On another internal level, in 1979 we witnessed the arrival of UK Prime Minister Margaret Thatcher, who saw the grand opportunity that a more unified European market could offer Britain. After all, it is more profitable to sell one’s products to potentially 340 million European consumers than to only 60 million Brits. Like her counterpart Ronald Reagan, she was an advocate of neoliberal policies and pursued an intensive privatization program. Companies in which the British government had at least part ownership were sold to the public sector, including British Airways and British Telecom. Thatcher was also adamant about keeping the UK’s budget under tight monetary control, resulting in drastic cuts in welfare spending. She was often portrayed as the “Euroskeptic” par excellence. It is true that her abrasive confrontational style was not well received by her European partners. She criticized European institutions for being too bureaucratic and costly, and she passionately fought many proposals that might have undermined British national sovereignty. But the image of the feisty lady, banging her handbag on the negotiating tables of Brussels, ought to be at least slightly rectified. As a politician who advocated the principle of the free market, an enlarged European free market was too good an opportunity to let pass.
All these internal and external factors were conducive to a change in direction. Now it fell to the leader of the European bureaucracy, Commission President Jacques Delors, to elevate the Community to a new level, which he did by spurring the implementation of the Single European Market (SEM)-the free movement of goods, services, capital, and labor-through precise steps. Delors had been the finance minister of France under a socialist government, and he combined three unique qualities which, taken by themselves, would already have been quite impressive.
First, he was a cunning diplomat and negotiator, always well prepared and briefed before summit meetings. Delors often managed to forge alliances in secret, and he had proactive control of the EC’s agenda and more than once acted as a masterful puppeteer controlling the European heads of government. His clashes with Thatcher became the stuff of legends.
Second, Delors was a very skillful bureaucrat. Based on an in-depth report by Delors’s fellow commissioner, Lord Cockfield, the Community finally agreed, in 1985, to realize the Single Market, which the Treaty of Rome, thirty years earlier, had already agreed to do. Delors, however, turned that theoretical objective into practical reality by drafting 270 precise measures, which, once implemented by the member states, would guarantee the four freedoms. Delors even had the courage to impose a six-year deadline on the implementation, after which the member states would be subject to fines by the European Commission. An especially impressive feature of the Cockfield Report was a timetable that was not only realistic but also sufficiently transparent to ensure that the necessary pressure from the Commission could be maintained. Lastly, Delors was a visionary who adopted a commonsensical approach to the future of the European project, and questioned which policies would have been better organized at the supranational rather than the national level.
For instance, the environment is essentially supranational; clouds and rivers, and therefore pollution, do not recognize borders. With this in mind, Delors was able to convince national leaders to set up a European environmental policy. Further evidence that supranational efforts were needed was provided by the technological innovations emanating from Japan and the United States; because individual European countries were unable to keep pace with those countries in these areas, Delors argued for transnational cooperation in scientific research and technology-this ultimately resulted, for instance, in the development of the Airbus.
Single European Act
The Single European Act (SEA), signed by the member states in 1986, marked a dramatic departure from the intergovernmentalism that dominated the previous seventeen years. At last, the spirit of The Hague, in 1969, resulted in concrete treaty commitments. The SEA linked the re-launching of European integration with institutional reform and a range of new policy responsibilities, a strategy that would maintain the momentum of the invigorated European Community for years to come. The key characteristics of the SEA can be seen in terms of these policy areas and institutional reforms and their political consequences.
The main policy area of the SEA was the Single European Market initiative, with its famous 1992 deadline, which reasserted the free movement of goods, services, capital, and labor, and meant, of course, the removal of national quotas and tariffs. Still, the SEM went further than any previous attempts at establishing a single European market. This time the SEM was concerned with removing nontariff barriers that distorted trade through different product specifications or purchasing agreements. This would finally secure the four freedoms outlined in the Treaty of Rome. In addition, completely new policy areas involved cohesion (the reduction of economic and social inequalities between rich and poor regions), research and technology, and European Political Cooperation (EPC), a forum to discuss foreign policy. The Single European Act, with its SEM initiative and impressive range of new policy fields, certainly moved toward accomplishing the two key goals of completing and deepening, which had been the objective of The Hague summit of 1969.
The main elements of institutional reform were primarily concerned with the introduction of a system of majority voting. Though majority voting was initially restricted to issues connected to the completion of the Single European Market, it nonetheless represented a significant departure from an era dominated by the Luxembourg Compromise. It also significantly increased the status of the EC’s bureaucratic apparatus (the European Commission), because individual member states were no longer able, single-handedly, to block legislative proposals emanating from that organization. Second, the role of the European Parliament was increased.
Although members of the EP had been directly elected since 1979, their legislative function was severely curtailed, given that they were only consulted once the Commission had already drafted and proposed new laws. The SEA, however, introduced the so-called cooperation procedure through which the EP was now allowed to play a role in amending legislation, albeit only on a limited number of issues. In addition, the assent procedure required the approval of a majority of MEPs in cases where the European Community incorporated new member states or concluded international agreements. Although the powers of the EP still paled in comparison with other democratic assemblies, the SEA nonetheless was seen as an important improvement in the democratic features of the Community.
The Single European Act, 1986
• New policies:
Single Market Deadline for 1992
European Political Cooperation
More power to the EP
Qualified majority voting
The political consequences were also significant, as the existence of the SEA demonstrated that Europe was now an important area of real political activity. The interaction between national ministries and departments, on the one hand, and the European bureaucracy in Brussels, on the other, had intensified as new legislative proposals drafted by the Commission ran their course. Also, with the rise of the SEM, interest groups began to pay more attention, and subsequently the number of lobby groups present in Brussels skyrocketed. Finally, the SEA created the largest and wealthiest market in the world, and it gave the Community a much greater weight at the international level. In particular, the Uruguay Round, which started in 1986 and aimed to set up global free trade, was heavily influenced by the Europeans who negotiated as a single, unified economic actor.
A New World Order in the 1990s
Throughout the history of European integration, internal reforms often were the political responses to major external events. By far the most important event was the collapse of communism in Central and Eastern Europe between 1989 and 1991. One by one the former communist satellite states of Hungary, Czechoslovakia, Poland, Romania, Bulgaria, and East Germany shed their authoritarian past and held free elections. Nascent democratic regimes in these states sought closer cooperation with the rest of Europe. In December 1991 the old Soviet Union ceased to exist and was replaced by a loose so-called Commonwealth of Independent States (CIS). These political developments posed severe challenges for the European Community. With the old Warsaw Pact gone, a security vacuum emerged, and no one could safely predict whether the transitions to democracy and capitalism in Central and Eastern Europe would be successful. The worst-case scenario could have been a return to autocratic forms of government. Furthermore, after years of communist rule, democratic practices and institutions, as well as a pluralistic civil society, needed to be established in countries with little history of democracy. Hence Western European states had to prepare themselves for such possible security threats as drugs and human trafficking, organized crime, or widespread migratory movements, and to seek institutional mechanisms to address these problems.
The collapse of communism, however, also brought more immediate concerns for the Community in the shape of German unification. In economic terms, the fall of the Berlin Wall resulted in the unification of the West European champion and the champion of the communist trading bloc, the Council for Mutual Economic Assistance, or COMECON. Despite both the significant financial costs of unification and the run-down state of the East German industrial infrastructure, European leaders, most notably French President François Mitterrand, felt that an already economically dominant West Germany would become even more capable of further dominating the European economy. Mitterrand saw further European integration as a safeguard against such dominance, and he strongly pushed for closer economic and monetary integration.
It therefore came as no surprise that, only five years after the SEA, the Community embarked on another amendment to its treaties. But in the run-up to the summit in the Dutch town of Maastricht in December 1991, a number of opposing views on the future direction of European integration began to swell the political agenda. Arguing for a more supranational path, Commission President Jacques Delors published a report in 1989 on the benefits of economic and monetary union. In a similar vein the report by Commissioner Paolo Cecchini, in 1988, had analyzed the costs of what he called a non-Europe that would fail to integrate to greater degrees.
Margaret Thatcher, meanwhile, was increasingly skeptical of the ambitions of the Brussels bureaucracy, and in her famous speech at the College of Europe in Bruges in 1988 she refocused the debate on the limits of European integration by arguing for the safeguarding of national sovereignty and independence.14 She stressed that “willing and active cooperation between independent and sovereign states is the best way to build a European Community.”
Disagreement over the precise path of future integration among the European political elite was now mirrored by the public. In order for a treaty to be ratified, each member state had to approve of it; depending on national constitutional requirements, this could be done either by a parliamentary act (the most common form) or by referendum (as used, for instance, in Denmark and Ireland). After finally agreeing on the Maastricht Treaty-officially called the Treaty on the European Union-Mitterrand decided to hold a referendum, even though ratification by the French parliament would have been sufficient. Mitterrand argued that the popular approval which a clearly won referendum could offer would carry more symbolic weight and would encourage ratification in other countries. There was one flaw in his calculation, however; until the 1990s European integration was largely an elitist project, with only rare interaction between politicians and the general public. The policies of the Single European Act of 1986, with its establishment of the Single Market, and to an even greater extent the policies of this new Treaty, with its proposed introduction of a single currency, had a much more tangible effect on the lives of European citizens. Many reacted with skepticism, borne not necessarily out of opposition to the European idea but simply out of a lack of information. The referendum in France just produced a “yes” vote by the narrowest of margins. With a 70 percent turnout in September 1992, the referendum was approved by only 51 percent. Thus instead of an affirmation of France’s pro-European stance, the referendum turned into a disastrous public-relations exercise.
In Denmark, ratification of the Maastricht Treaty was rejected outright in a referendum in June 1992. Obviously the entire ratification process was in jeopardy. The Danish government therefore negotiated an opt-out clause for Maastricht’s most controversial policy-the single European currency-and at another referendum, in May 1993, the Danes finally gave their approval.
Britain experienced similar political turmoil when John Major, who replaced Thatcher as prime minister in 1990, decided not to hold a referendum. The parliamentary act of approval turned out to be a troublesome affair that split his ruling Conservative Party. Major was also forced to negotiate an opt-out clause both for the single currency and for the social charter that established certain workers’ rights throughout Europe. In the end only a watered-down version of the treaty for the UK and Denmark placed the ratification train back on track.
Treaty on the European Union (Maastricht Treaty)
Against the backdrop of these conflicts over the future of European integration, the Treaty on the European Union (TEU) represented a compromise that was actually less coherent than the previous SEA treaty of 1986. Of course, responses needed to be found to new internal and external challenges, but these had to finely balance intergovernmental concerns over a potential loss of the member states’ national sovereignty and supranational aspirations for an increasingly unified Europe.
The TEU was unique and far-reaching in content and structure. First, the European Community gave itself a new name-the European Union-reflecting the closer nature of the member states’ relationships with one another. The TEU also referred for the first time to citizenship values and gave Europeans, at least those who were citizens of an EU member state, uniform rights. This attempt to address the Union’s lack of democratic credibility was complemented by a number of institutional innovations. The legislative powers of the European Parliament were increased through a new method for drafting legislation called the co-decision procedure. The EP was also told to appoint an ombudsperson so that EU citizens could challenge administrative decisions taken by any EU institution. Another independent institution-the Committee of the Regions-was created to include sub national, regional voices in the EU’s legislative process; this Committee had to be consulted whenever a regional issue appeared on the agenda.
Even more significant, the TEU completely elevated new policy fields to the European level, away from the exclusive authority of the member states. Although Maastricht did not replace previous treaties but only amended them, these amendments were indeed far-reaching. The TEU was organized as three pillars. First and foremost was Pillar I, also called the Economic Community, containing previous treaties and their revisions but also important new policies, most notably the single currency and Economic and Monetary Union (EMU). The second pillar introduced a Common Foreign and Security Policy (CFSP). The third addressed cooperation in the fields of Justice and Home Affairs (JHA), including such issues as police cooperation, immigration, asylum, and internal security matters. The most important difference between the three pillars was that decisions in Pillars II (CFSP) and III (JHA) would be made through intergovernmental negotiations between member states, whereas the largely economic Pillar I retained and extended supranational policy making.
The most significant innovation was, undoubtedly, the decision to merge national macroeconomic policies in an Economic and Monetary Union. Essentially EMU envisaged not only a single currency but also a single monetary policy, such as one interest rate, for all participating countries. Obviously EMU would relieve companies trading across borders and cross-border travelers the cost of exchanging currencies.
This also meant that national central banks could no longer fine-tune their economies by adjusting interest rates in response to changing economic climates. In the Maastricht Treaty the member states agreed both to a timetable for implementing EMU by 1999 and to a number of European institutions to manage the transition. The CFSP of Pillar II provided a framework enabling member states to present a unified presence in international diplomacy. Because foreign and security policies are often regarded as vital bastions of a country’s national sovereignty, this was indeed a very ambitious undertaking. It bears repeating that joint diplomatic action was not based on majority voting but on unanimous agreement by all member states, which greatly reduced the scope of diplomacy. As was seen in the Iraq crisis in the spring of 2003, EU member states could not agree on a common approach to dealing with Saddam Hussein, which simply meant that, on that occasion, one could not speak of a common policy response. Finally, the CFSP built a framework for developing a common defense policy through the Western European Union  (WEU) that would “elaborate and implement decisions and actions of the Union which have defence implications” (Article J4 TEU).
The third pillar, representing Justice and Home Affairs, provided guidelines for coordinating various ad hoc arrangements concerning asylum, drug trafficking, or customs. JHA, as did the CFSP, offered member states a chance to develop joint actions in these fields but, again, only through unanimity. Without question, the institutional reforms and policy innovations dramatically changed the face of the European project. But this push for closer integration came at a high price. Because of severe public concern in Denmark and Britain, the ratification process could only be safeguarded by offering these countries the option to withdraw from EMU (Denmark and Britain) and from the social charter (Britain only). As a result, the notion of European solidarity, of a one-size-fits-all Europe, was now gone. Instead, Maastricht introduced the concept of a Europe à la carte-albeit in a mild form-where member states rejected policies that were not in line with their own national political agenda. The provision of the opt-out clauses accommodated differences between member states, and thus highlighted the serious differences between European governments concerning the future of the EU.
Another result was that the European project turned from an elitist undertaking driven by individual political leaders into a hotly debated issue that was now part of the political mainstream. The referenda in France and Denmark offered ample evidence for this. In the UK the Maastricht debate had split the ruling Conservative Party, as well as the public. In Germany, often portrayed as one of the continent’s main driving forces for European integration, the general population harbored serious doubts over whether it was a good idea to give up the beloved Deutschmark for some supranational coins and notes. The responses by European citizens to the Maastricht Treaty effectively placed a limit on the speed and extent of integration that the populace of the member states would tolerate. Any further treaty amendments, therefore, had to be less ambitious and more intent on ironing out some of the institutional and policy shortcomings that still undermined the Union.
The Maastricht Treaty, 1992
Economic Community-Common Foreign and Security Policy-Justice and Home Affairs
Economic and Monetary Union - Unified international diplomacy - Asylum, immigration
Single Market, agriculture - Common Defense Policy - Police cooperation, customs
Qualified majority voting - Unanimous agreements - Unanimous agreements
Supranationalism - Intergovernmentalism - Intergovernmentalism