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Debates

The UK and Europe

Europe 2.0? EU integration after the British referendum

Renaud Thillaye / Jun 2016

Mariano Rayo, Matteo Renzi, Angela Merkel, David Cameron and François Hollande. Photo: European Union 2016

 

For Brexiters, history is already written: the EU is on course to become a superstate. Yet, those who have followed European integration closely in recent years know that this claim is completely misleading. Understanding how the EU works today is crucial to dispel this myth. It also helps to make an informed judgement on what the EU would look like after the referendum.

Little has changed in British perceptions since Osborne’s suggestion that the Eurozone should embrace the “remorseless logic” of monetary integration in 2011. Yet, even if the assumption that the Euro area crisis would force integration makes sense, there is confusion as to the timeframe and what is meant by integration. The currency union has not taken giant steps towards a fiscal union and more central institutions. The short-term firefighting on display relies on member states’ one-off contributions, conditional collective loans, intrusive peer surveillance and fiscal policy through the monetary backdoor. More radical decisions, such as debt mutualisation, the setting-up of automatic transfers or simply debt reliefs, have been methodically avoided so far.

Such reluctance to supranational and solidarity mechanisms should not surprise anyone. Europe has long shifted from the ‘permissive consensus’ of the early integration years to a ‘constraining dissensus’. While the first decades were driven by business interests far away from a relatively indifferent public, the expansion of the EU’s reach to core state powers (such as money and border management) has led to politicisation, mostly in negative terms. The public’s reluctance to fully transfer resources and state powers to the EU has brought about the paradox of intergovernmental integration. The new prominence of the European council and its agenda-setting role reflects the fact that European governments can no longer hide behind technocrats and need to ensure the decisions taken in Brussels are acceptable domestically.

In short, British Eurosceptics mix up a more political union – in the sense that the union gets involved in ‘high politics’ – with institutional centralisation.

Not very much will happen in the short to mid-term if British voters choose to stay in the EU. Implementing the 19 February agreement may not be easy, especially the controversial provisions related to migrants’ access to welfare. However the issue is here to stay and the UK will not be alone in facing the difficulty of reconciling a fundamental EU principle with the reality of a public backlash against it. In the field of economic governance, procedures have been agreed upon in case of disagreements between euro-ins and euro-outs. As such, they do not prevent disagreements from happening in the first place, but they reflect the goodwill which is likely to dominate in the near future.

A Remain vote will make little difference to the Eurozone’s internal debates. Though committed by the Five presidents’ report to launch a formal ‘completion’ process in 2017, the idea of a euro area treasury (mentioned in the report) remains a distant dream and conditional on greater economic and social convergence in the first place. Northern European countries are unlikely to lock themselves into fiscal union until the situation in southern Europe radically improves.

Neither is the clarification on ‘ever-closer union’ likely to take the EU to a different place. The formulation merely states the obvious, namely that existing treaty provisions already allow “those that want to deepen integration to move ahead, whilst respecting the rights of those which do not want to take such a course”. A reason for concern is the attitude of the four Visegrad countries, but their fear of a second-class status prevents them from following the British example.

There is no doubt Brexit would provoke domestic and global shock waves. This would compel pro-EU government forces to react swiftly. The assumption that Brexit would give an impetus for deeper EU integration is, nevertheless, too optimistic. Previous episodes of EU history have shown that the gap between declaratory politics and implementation can be huge, all the more in a context when vast swathes of the European public holds Eurosceptic views.

Germany and France are expected to take the lead in containing disorder and sending reassuring signals to the public. Logically, these should be about very pragmatic moves touching upon popular concerns about migration, security and employment. Nonetheless, Franco-German differences will not disappear overnight, in particular disagreements on the euro area’s governance and on EU foreign and defence policies. A tension may also appear with those countries unwilling to go along new initiatives, especially the Visegrad countries.

Brexit or not, EU leaders will need to strike a balance between the need for greater EU efficiency and the flexibility required to avoid new divisions. An option could be to multiply voluntary or experimental cooperations, which would not have the abrupt legal character of treaty-based enhanced cooperations or new treaties. This would take the EU closer to a ‘plug-and-play’ platform, whereby coalitions of the willing could easily launch joint projects without imposing anything on others, let alone discriminating against them. This is far from a grand rescue plan for Europe, but it might be the only way forward.

 

Renaud Thillaye

Renaud Thillaye

June 2016

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