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3. THE EUROPEAN UNION I:
ORIGINS, INSTITUTIONS, & ‘1992’
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Why is there regional integration?
The powers of the EU
European integration ‘theories’
Origins of European integration
The EU institutions
‘1992’ & the Single European Act
High Noon in Fontainebleau: A sketch
Conclusions
1. WHY IS THERE REGIONAL INTEGRATION?
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Attempts at regional integration are not new, but have
proliferated since the late 1980s
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What drives formation of regional blocs?
* Promotion of trade liberalization?
* Desire to address issues generated by growing economic
interdependence?
* Desire to bind national govts to certain policies?
* ‘If you do it ….’?
* Uncertainty re future of multilateral trade?
•
Why do some succeed, while others fail?
1. WHY IS THERE REGIONAL INTEGRATION (Contd.)
Mattli’s explanation of regional integration
• Demand condition:
As cross-border transactions grow, (big) business interests
push ever harder for integration (transaction costs!)
• Supply conditions:
1. There must be an undisputed leading state (hegemonic
power?) among members to ease distributional tensions
(be ‘paymaster’) & serve as ‘coordination focal point’
2. Economic difficulties to persuade national leaders
to forfeit decision-making powers
3. There should be ‘commitment institutions’
to monitor implementation, ensure compliance
THE EMERGING EUROPEAN STATE?
‘Within a decade, the European Community
will be responsible for 80 per cent of the
economic, monetary & social policy
affecting the member states’
Jacques Delors, president of the European
Commission, in a speech to the European
Parliament in 1988
2. THE POWERS OF THE EU
The EU is the primary source of regulations &
policy affecting business in Europe :
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The ECB makes monetary policy
The ‘Stability Pact’ constrains states’ fiscal policies
It makes external trade policy
It makes internal trade policy
It makes state aid & competition (anti-trust) policy
It makes some sectoral policies (agriculture!)
It has an important regional policy
But it does not make very much social policy
3. ‘THEORIES’ OF EUROPEAN INTEGRATION
I.
Transnational exchange & ‘neo-functionalism’ (=
‘supranational institutionalism’)
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TE (eg. trade) generates pressure for supranational
rules & organizations (transaction costs!)
•
Supranational rules generate self-sustaining dynamic,
deepening integration & spreading into new areas
•
Expanding transnational society, supranational
organizations & growing density of supranational
rules erode states’ capacity to control decisions
3. ‘THEORIES’ OF EUROPEAN INTEGRATION (Contd.)
II. Intergovernmentalism (=intergovernmental institutionalism)
• (Critical) EU decisions are bargains struck between the
‘leading’ member states (D, F, UK)
• Bargains represent LCD of these states’ preferences, except
where two big states can threaten third with ‘exclusion’
• Other states can be bought off by side-payments
• Govts are reluctant to cede sovereignty, may use
EU to increase autonomy v. domestic interests
• Integration is fitful, contingent, reversible ...
4. ORIGINS OF EUROPEAN INTEGRATION
• War was Europe’s perennial condition for centuries,
exacerbated by German ‘problem/question’ after 1870
• France’s traditional German policy – to contain, divide
or weaken it – had failed.
• The Cold War made a strong (West) Germany critical
• The three ‘godfathers’ of European integration:
* Stalin (inadvertently)
* Hitler (inadvertently)
* Truman (US president)
THE EU: THE US ‘GODFATHER’
‘Whether Germany is a blessing or a curse for the
free world in the future will be decided not only by
the Germans, but also by the occupying powers. No
country has as strong an interest in the answer as
France … Now is the time for a French initiative &
leadership, so that the FRG can be quickly & lastingly
integrated into Europe. Any delay will diminish the
chances of success. In view of the intensifying East/
West conflict, the occupying powers have very little
time left to bind the FRG to the West’
Dean Acheson, US foreign minister, to Robert
Schuman, French foreign Minister, 1949
4. ORIGINS OF EUROPEAN INTEGRATION (Contd.)
• French Schuman Plan (Coal & Steel Community) 1950 to:
* secure French access to German coal
* pre-empt Germany regaining autonomy in key industries
* bind Germany as tightly as possible to the West to prevent
it coalescing with the USSR
• Germany agrees because:
* Adenauer was pro-Western & anti-Communist
* ECSC would enable Germany to regain
international equality & respectability
* Alliance with France would pre-empt
Franco-Soviet alliance against Germany
TO MAKE WAR IMPOSSIBLE
“Europe … will be built through concrete achievements
which first create de facto solidarity. The coming
together of the nations of Europe requires the
elimination of the age-old opposition of France &
Germany …. The pooling of coal & steel production
… will change the destiny of those regions which have
long been devoted to the manufacture of munitions of
war …. The solidarity .. thus established will make it
plain that any war between France & Germany
becomes not merely unthinkable, but
materially impossible”
Schuman Declaration, 9 May 1950
WHY FRANCE LAUNCHED THE SCHUMAN PLAN
‘From the beginning, the effort to organize Europe had
had a double purpose: first, to strengthen the European
countries, which if left to fend for themselves would be
condemned to political & economic dissolution; and second,
to bring Germany into the common endeavors so that she
would not repeat her former errors. A democratic Germany
on an equal footing … will have no excuse for rebellion, aloofness & dreams of conquest & domination … [France]
envisaged the creation of such strong organic bonds among
the European nations – Germany in particular included - that
no German Government could break them’
Schuman, ‘France and Europe’, in: Foreign Affairs
31:3 (April 1953), p. 352.
THE EU: WHY GERMANY SAID ‘YES’
‘Adenauer was .. continually concerned that, in France,
those political forces that sought to keep down Germany
by cooperating with the Soviet Union could win the upper
hand. Naturally he never forgot the Franco-Soviet treaty
from the winter of 1944 … [The] different continental
European communities, in Adenauer’s view, served the
purpose of preventing a France that was insecure because
of its economic & political weakness, dangerous & driven
by negative memories [of Germany] from .. taking
the path to Moscow’
Hans-Peter Schwarz, Erbfreundschaft, p. 92
WHY GERMANY HAS SUPPORTED THE EU
“No country is more strongly dependent on the further
development of the EU than the united Germany. In
terms of population, Germany today is one and a half
times as big as France or England, twice as big as
Poland, five times as big as Holland, eight times as big
as Belgium. In all of these countries there are worries
concerning the prospective economic power of Germany;
in addition to this, there are the awful memories of the
Hitler era. If our country does not want to isolate itself,
if Europe is not to return to a policy of forming coalitions
as a counterweight to Germany, then we Germans need
to be integrated into an EU that functions effectively”
Helmut Schmidt, in: Die Zeit, 6 August 1993
4. ORIGINS OF EUROPEAN INTEGRATION (Contd.)
• French Pleven Plan (European Defence Community):
* to rearm Germany (Korean War!) while keeping German
army under European, espec. French control
* fails because of French Gaullist & Communist opposition
• Economic community proposed by Benelux states, partly
to forestall bilateral Franco-German integration
• Franco-German rapprochement in Hungarian & Suez crises
& solution of Saar problem (whose is it?) facilitate
Rome Treaty 1957
• France insists on CAP as price for industrial trade
liberalization
THE EUROPEAN DEFENCE COMMUNITY
‘Only France is to retain additional forces of her own, for
the defense of her overseas territories. No element of the
common army is at the disposal of any govt acting alone …
Not only is the high command integrated, but the same is
true of all units larger than a division … Each will be
composed of officers & men of different nationalities. There
will be German soldiers but no German Army; German
officers at every level but no German general staff; and the
same will hold true for continental France & other
signatory nations’
Robert Schuman, ‘France and Europe’, in:
Foreign Affairs 31:3 (April 1953), p. 355.
FAMOUS LAST WORDS?
What a British diplomat said when he left
the Rome Treaty negotiations
“The future treaty which you are discussing has no
chance of being agreed; if it was agreed, it would have
no chance of being ratified; and if it was ratified, it
would have no chance of being applied. And if it was
applied, it would be totally unacceptable to Britain.
You speak of agriculture, which we don’t like, of
power over customs, which we take exception to,
and of institutions, which frighten us. Monsieur le
president, messieurs, au revoir et bonne chance”.
5. THE EU INSTITUTIONS
• European Commission (‘executive’, nominated
by govts, policy initiator, some autonomous powers)
• Council (‘legislature’, govt ministers, weighted votes,
decides by QMV or unanimity) & European Council
• COREPER (Committee of Permanent Reps. - Makes
‘90%’ of Council decisions) & its working groups
• The European Parliament (advisory & veto powers)
• The European Court of Justice (strong through
direct effect & EU law supremacy doctrines)
6. ‘1992’ & THE SINGLE EUROPEAN ACT
• Integration indeed fitful up to early 1980s: still
important non-tariff barriers to trade (eg. standards)
• Milestone ‘cassis de Dijon’ judgement of ECJ; Delors
Commission proposes ‘1992’ (economic liberalization
& institutional reform, eg. more QMV)
• Two explanations:
1. Alliance of Commission, ECJ, big business
(neo-functionalist/transnational exchange)
2. LCD of ‘big three’ govts (intergovernmentalist)
8. CONCLUSIONS
• European integration driven more by politics than economics,
to prevent war, not to promote trade or cut transaction costs
• It has been shaped & driven primarily by France
& Germany. France wants to bind Germany into Europe;
Germany wants to bind France & be bound itself
• Intergovernmentalism seems a more powerful
explanation than neo-functionalism or transnational exchange, but can it explain:
• Day-to-day, as opposed to big, decisions?
• The drive for European monetary union?