An Imperfect Union: Understanding European Integration
Initial reactions in Europe
The Germans were pleased to see a start made towards a common foreign policy, though progress towards political union and in the strengthening of the European Parliament was less than they would have liked. Above all, they welcomed the moves towards currency integration, and were pleased that the Central Bank was to be modeled on German lines.
For the French, the most significant step was the timetable towards monetary union, with the deadline for the single currency. They did not get the commitments on majority voting for the Council on matters of foreign policy which they favoured, nor the development of a defence policy more independent of the USA.
Spain, Portugal and Greece obtained the concession of more funds for the poorer countries of the Community, and Greece was to be allowed to enter negotiations with a view to joining the WEU, the future defence arm of the Twelve, in 1993.
The Netherlands, in its presidency of the Council, had brokered an agreement, despite the odds. The fact was that everyone wanted an agreement, so that concessions were made all round. The text was designed to ensure that there was something for everyone, for each national leader obtained some trophies to take back home so that he could claim some national benefit and Community progress. There was disappointment and irritation about special treatment for the British. As the Dutch premier put it: ‘The United Kingdom is very much the same, except that this Prime Minister does not have a handbag’. Progress was less than some would have liked, with the British again seeming to have applied the brakes. But the majority could comfort themselves with the thought that, in the end, those nations which initially lag behind in their commitments do usually eventually catch up with the others.
Position of the United Kingdom
British tactics at Maastricht had been influenced by short-term considerations, such as not upsetting the Tory Right. Most Conservatives were highly relieved by the outcome of the summit, for after all of the interparty strife which led up to it the result was one which many of them could accept. A damage limitation exercise was needed, and they felt that, by a deft performance, John Major had secured a negotiating triumph and won ‘game, set and match’. British national interests had been protected, for many of the things they feared most had been omitted from the Treaty. Majority voting on key issues of foreign policy had not been approved, so that Britain still retained a theoretical right to act alone if it so wished. The ‘f’ word had been dropped, so Conservatives could reassure themselves that they were no longer on a conveyor belt to a federal future. Above all, no irrevocable decision had been made to join a single currency (Britain could ‘opt in’ at a later date). In addition, the government did not sign up for the much-despised Social Chapter.
The long and difficult road to ratification
As we have seen, the immediate outcome of the Maastricht Summit was a feeling of satisfaction among many of the European leaders who took part. Each had come away with something which could be displayed to the electorate at home as a personal triumph of skilful negotiation. Public reactions initially seemed modestly encouraging, although there was little evidence of widespread popular enthusiasm. Such Europhobia as there was among certain groups was to be much tested prior to ratification and in the years which followed as steps were taken towards the achievement of economic and monetary union.
Growing doubts in Denmark and France
For the Maastricht Treaty to come into force, it had to be ratified by the parliaments of all the member states. The target date for ratification was given as 1 January 1993, so that the Treaty could be operative from 1994, with the title European Union then replacing that of European Community.
The process soon ran into difficulties, though the Treaty was approved by the European Parliament early in 1992. By the spring, it was becoming apparent that there were growing misgivings in several countries. In Denmark the Treaty was approved by a strong majority in the Folketing, but in a referendum in June 1992, the Danish people narrowly rejected it. Although there were only 48,000 votes between the two sides, the verdict caused a political earthquake. The effect was to kill the Treaty unless there was to be another vote which reversed the stand taken, for the Treaty had to be ratified by all member countries. This suggested that either there must be renegotiation to allay Danish fears, or the other eleven must go ahead on their own.
Meanwhile, other countries pressed ahead with their own ratification. In Ireland, later in the same month, the electorate voted strongly in favour of the Treaty. The Yes vote exceeded expectations, and this gave a boost to the process of ratification after the shock of the Danish setback. Given the strongly agrarian – and backward – nature of their labour force, the Irish were net beneficiaries from the EC. They had a strong reason to favour the further development of the Community.
However, the mood of many people in France was becoming more sceptical, with opposition to Maastricht particularly strong on the far left and far right. The situation was worsened by growing discontent with changes to the CAP which upset the farming vote and helped to fuel anti-EC feeling. In September, the voters gave a very narrow (50.5 per cent to 49.5 per cent) endorsement to Maastricht. For the French to stagger over the hurdle so perilously was in some respects a surprise, for they had always been in the forefront of the mow towards European integration. Nonetheless, that they did so at all created a huge sense of relief in other EC capitals.
Solving the Danish Problem
Attention turned to attempts to resolve the Danish problem. The Danish voters needed to be assured that, among other things, the EC would develop in a more ‘user-friendly’ and decentralised manner, so that the drift of power from national states to Brussels could be reversed.
There were cautious hopes that a formula could be found to enable the Danish government to go back to the voters with a reasonable prospect of them giving approval to the Treaty.
The Danish issue was examined at the Edinburgh Summit in December 1992, along with a series of budgetary issues. The ‘Loose ends’ of the Maastricht Treaty were finally tidied up. This was a settlement which all the twelve members of the Community badly needed. Several problems were resolved, and each country gained something suitable. The British were finally able to ratify the Maastricht Treaty in August 1993. However, a legal challenge in Germany threatened to derail the ratification process, for some opponents argued that the Treaty fundamentally altered the German Constitution. This last-minute move failed. As a result there were no further obstacles to negotiate. Ratification was completed in all member states, and on 1 November 1993 the new European Union came into force.
A note on subsidiarity
The doctrine of subsidiarity was first put forward by Pope Pius XI in 1931. For him, it meant ‘government at the lowest possible level’. At the Edinburgh Summit, the British government placed much emphasis on the idea, for it seemed to be useful ammunition against those Tory rightwingers who feared that a ‘federal super state’ was being created on the foundations of Maastricht. Subsidiarity could help to tame the so-called ‘Brussels Monster’ and bring about a decentralization of decision-making.
Subsidiarity was already written into the Maastricht Treaty, which insisted that decisions should be taken ‘as closely as possible to the citizen’. In Article 3b, it was spelt out that:
In areas which do not fall within its exclusive competence, the Community shall take action, in accordance with the principle of subsidiarity, only if and in so far as the objectives for the proposed action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community. Any action by the Community shall not go beyond what is necessary to achieve the objectives of this Treaty. Douglas Hurd, the then British foreign secretary, spoke in July 1992 about subsidiarity in this way:
In the wide areas outside the exclusive competence, the Community should ask two questions: Is it necessary for the Community to act: If so, to what extent? Even in the areas where national governments have by treaty given the Community exclusive competence, the institutions of the Community should ask to what extent do we need to act to secure the full objectives of the Treaties, bearing in mind that excessive intrusion is one of the accusations most often brought against it. Jacques Delors tried to reassure the British and others, by stressing that under the principle, matters such as internal security, justice, planning, education, culture and health should remain the responsibility of member states. Some continental MEPs expressed the concern that subsidiarity could be used as an excuse to weaken integration. They feared that the cloak of subsidiarity was being used to enable the British government to kill off environmental and social directives in which Britain lagged behind.
At Edinburgh, new procedures were agreed to ‘fill out’ the doctrine which only had much meaning when applied to particular policies. In future, national power was to be the rule and EC power the exception. The EC was to act only when member states could not achieve the desired goal as well themselves. There was no question of challenging the existing powers of the Community. However, the Commission agreed to withdraw or amend twenty-one pieces of actual and draft legislation, as opposed to the seventy-two favoured by Britain. They include matters such as the treatment of animals in zoos, the harmonization of gambling regulations and certain food labeling directives.
After several years of relative slumber following the First Enlargement, the drive towards unity in Europe received a new impetus from the mid-1980s onwards. The passage of the Single European Act; the creation of the single market; the development of a European Union; and the extension of EU into new areas such as the environment, justice and home affairs, and foreign and security policy – all these from the point of view of euroenthusiasts were positive moves. Moreover, the EU was on the verge of further expansion. No one could be sure of exactly where the Maastricht Agreement would lead,
- or that the necessary convergence of the European economies in preparation for EMU would come about. However, most member states were intent on strengthening and uniting the new Union. In an uncertain Europe, where the East was in confusion and in France and Germany there was the possibility of a rightwing backlash, the wish of many Europeans was to see irreversible progress towards their ultimate goal.
The future looked uncertain. There was talk of a major world recession, with the most important economies of the postwar years, Germany, Japan and the United States, all beset by difficulty. Whether the preparations for EMU could survive a sustained recession could not be predicted, but a downturn in the world economy was a threat to the Maastricht initiatives.
A note on Jacques Delors
Delors is French, a Catholic, a socialist and a federalist, and three of these made him a ‘bête noire’ to Mrs Thatcher. Despite British misgivings about his attitudes and role, John Major supported an extension of his presidency, so that he served a further two years, after two four-year terms.
During his ten years, he was an active and interventionist president who intellectually dominated his colleagues. He was driven forwards by a single-minded vision of European integration. His work to promote the single market, economic and monetary union and the Social Chapter, and his package of antiunemployment measures (Delors II) entitle him to be considered one of the architects of the drive towards European unity.
He was much involved in the Maastricht negotiations and believed it was the best treaty that could be obtained in the circumstances – faced as the participants were by British ‘intransigence’. But it was not the outcome that he personally wanted. He saw it as a mixture of obscure, technocratic and sometimes undemocratic elements which bore only the vaguest and most muted echo of the federalist ideals which had long inspired the goal of European union. In particular, he disliked the incomprehensibility of a treaty which had three separate decision-making ‘pillars’ built into it. Yet the alternative to ratification was, he feared, a retreat to an inward looking, impotent Europe plagued by the dangers of economic nationalism.
Terms:
Association Agreements – an agreement concerning the relationship of a country outside the EU to the Union itself. Candidate countries for entry have often made ‘association agreements’, the first being the one between Greece and the EC in 1961. There have subsequently been fourteen such agreements. Romania was the first country of Central and Eastern Europe to have official relations with the European Community. In 1974, a treaty had included Romania in the Community’s Generalized System of Preferences. Its associate status was agreed in 1993.
Cohesion – Action to reduce regional differences within the EU, brought about by the use of structural funds designed to boost living conditions.
A Cohesion Fund was established in 1993 as part of the Delors II package, at the Edinburgh Council (December 1992). It provides specific financial assistance for projects in the least prosperous areas of the Community, at that time Greece, Ireland, Portugal and Spain.
Competence – An area within the EU’s sphere of responsibility. The term is used when examining the extent of the Union’s power and influence in relation to that of member states.
Delors II – A budget package advanced in February 1992 to secure the financing of the EU over the medium term. Budget resources were increased, particularly with the intention of making cohesion affordable. The package was agreed at the Edinburgh Summit (December 1992) and provided for an increase in ‘own resources’ of the Community to 1.27 per cent of GDP from 1999 onwards.
Eurosclerosis – A period of stagnation and disappointment, when the Community/Union seems mired in difficulties. The term is generally applied to the 1970s, when there was little movement towards integration.
Exchange Rate Mechanism (ERM) – A central component of the European Monetary System, the ERM was a mechanism devised to reduce currency speculation among member states and therefore promote financial stability. Each participating currency was given an exchange rate set in relation to the ECU (the currency an accounting unit employed prior to the adoption of the euro), there being some scope for fluctuation. Britain initially declined to join the ERM, but eventually did so in October 1990 at a time when the system was becoming more rigid. Uncertainty in the currency markets in the summer of 1992, accompanied by a rash of speculation against ERM currencies, led to British withdrawal in September 1992, on ‘Black Wednesday’.
Structural funds – These are the principal means via which aid is directed towards the least developed areas of the Union. There are four structural funds: the European Regional Development Fund, the European Social Fund, the European Agricultural Guidance and Guarantee Fund and the Financial Instrument for Fisheries Guidance.
Subsidiarity– A description of a political system in which the functions of government are carried out at the lowest appropriate level for efficient administration; the idea that each level of government has its suitable geographical level. Subsidiarity is believed to enhance democracy. Germans would portray it as the very essence of federalism, but Majorite Conservatives saw it as a means of fending off a more deeply integrated Europe.
