What a good idea it must have seemed to have a European Council meeting which was not just about the sovereign debt crisis and the euro. That was the intention for the most recent gathering. And it was good that at least part of the discussion was devoted to the security of energy supply and innovation. Although the conclusions were very general, certain lines of action emerged. It was appropriate that the heads of government took stock of the situation in Egypt. Regrettably, there was no clear line about engaging with new democratic forces in North Africa. There was no decision to move forward on the idea of a special summit on economic and political co-operation with the region as it enters a new era.
In the media, there was barely a word about the substantive points on the European Council agenda. Coverage was all about the row over the German-French initiative for a “competitiveness pact” for the eurozone countries. French President Nicolas Sarkozy and German Chancellor Angela Merkel held a joint press conference to announce their proposals, almost as the meeting was about to begin. This was a hijack, pure and simple.
One can be positive about some aspects of the initiative. It is good to see Germany coming forward with policy ideas to bolster economic governance in the EU. It is sensible to have a debate about guarantees to strengthen the credibility of commitments about spending. It was inevitable there would have to be some extra conditions to make the existing temporary bailout mechanism both stronger and, from 2013, permanent. Perhaps above all, it is reassuring to see Berlin and Paris working together. Over 40 years, some of us remember the gripes when the French and the Germans have been portrayed as imposing their will on smaller, weaker or more marginal members of the European community. But when they do not co-operate, nothing happens.
Nevertheless, the “competitiveness pact” is a misnomer. Depressing public spending, reducing purchasing power and encouraging wage deflation will not achieve greater European competitiveness. Public spending must be brought under better control, but competitiveness also requires more and better training, higher levels of educational attainment, far greater expenditure on research and development (public and private), and modernising much of Europe’s increasingly decrepit infrastructure. On these issues, the French and German leaders were rather more reticent. And they oppose any effort to strengthen the European Union’s resources to meet the competitiveness objective. In terms of consensus building to get a quick agreement on the German-French proposals so that the euro might be bolstered, the shock and awe tactics were almost entirely counter-productive. So Herman van Rompuy, the President of the European Council, has again been dragooned into service to try to get a package together by the end of this month.
There are dangers for the broader European project in the creeping institutionalisation of the eurozone. Member states outside the single currency may fear that the real EU business starts to get done without them. The dividing line between euroland governance and that for the broader EU is not always easily drawn. The European Commission faces further sidelining as preparatory and implementing tasks are giving to European Council President. Accountability to the European Parliament is also jeopardised. And this inter-governmental approach is coupled with the prevailing anti-Brussels mood in Paris and in Berlin. France and Germany seem united in their determination to further weaken the European Commission’s authority. The Commission’s powers on internal market enforcement and competition rules may not remain unscathed as this process develops.
It was always going to be the big test: how to reach decisions in a diverse EU of 27 nations. The Lisbon Treaty – with increased majority voting – was meant to be the answer. But it has not laid the matter to rest. Europe’s leaders need to tread very carefully when they stray from the more orthodox procedures, even when they are only doing what may be necessary. The new European architecture is fragile and needs to be consolidated, not undermined. Europe’s citizens already find routine decision-making remote and opaque. Their bafflement may turn to even greater alienation if Lisbon’s “simplification” of decisions and institutions is further diminished.
Julian Priestley was secretary general of the European Parliament from 1997 until 2007
