WORLD

Forging a future

The debate over monetary and political union

ANDREW PHILLIPS December 9 1991
WORLD

Forging a future

The debate over monetary and political union

ANDREW PHILLIPS December 9 1991

Forging a future

The debate over monetary and political union

THE EUROPEAN COMMUNITY

We went in to screw the French by splitting them off from the Germans. The French went in to protect their inefficient farmers from commercial competition. The Germans went in to cleanse themselves of genocide and apply for readmission to the human race.

—Sir Humphrey Appleby

The fictional Sir Humphrey in the classic British television satire Yes, Prime Minister often reminded his political masters that behind the lofty rhetoric of international harmony so favored by its leaders, the European Community remains an arena of sharp national rivalries and fears. And as they jockeyed for position in advance of a critical summit on the community’s future in the Dutch town of Maastricht next week, the EC’s leaders seemed determined to prove him right. Britain’s Prime Minister John Major warned that he would veto proposals for a “federal” Europe. German Chancellor Helmut Kohl insisted that he will veto any measure that would weaken his country’s currency, the deutsche mark, the symbol of Germany’s economic might. And EC President Jacques Delors, head of the bureaucracy that runs the community, issued his own gloomy forecast. The outline of the new union emerging from weeks of bargaining among the 12 member states, said Delors, is likely to result only in “organized schizophrenia.”

The high-stakes two-day summit opens on Dec. 9. Community leaders are expected to sign two treaties on

economic and political union—potentially a radical leap that would move the EC far from its origins 34 years ago as a common market, towards a much more powerful and centralized structure. The proposals are most controversial in Britain, where former prime minister Margaret Thatcher and other members of a determined band of so-called Euro-skeptics in Major’s own Conservative party are pressing him not to surrender any more sovereignty to the rest of Europe. If Major cannot negotiate a deal that he can sell to his party, he may refuse to sign the treaties and torpedo the summit. And that, analysts say, would halt the bandwagon of European unity, encouraging Germany to act independently rather than in close concert with its neighbors. “The impetus for European integration would die out,” said Jonathan Eyal,

director of studies at the Royal United Services Institute, a London think-tank. “The fear is that we will slide into mutual bickering.”

The drive to centralize the EC was bom in the wake of the collapse of the Iron Curtain two years ago. At the time, the community was focused on its own heavily promoted 1992 program—a campaign to tear down trade barriers and create a single market of 325 million consumers by the end of next year. But the end

of Europe’s political division and the impending unification of East and West Germany posed a whole new set of challenges. France was eager to tie its old rival more tightly into European institutions to forestall any possible resurgence of German nationalism. German leaders were prepared to co-operate, partly to calm outside concerns about their new power. Those who fear German ambitions, Kohl said last week, should “join in building a firm roof over this Germany, this Europe.”

The result is a set of proposed treaties for debate next week. The pact on economic union would set a timetable for drawing European economies and currencies closer together. At the beginning of January, 1997, a single European currency issued by a new European central bank would replace pounds, francs and

marks. Major has reassured Britons that the pound will not disappear without Parliament’s approval, and he points out that the treaty will contain an opt-out clause that would allow Britain to jump off the unity train at any point. But few aspects of further EC integration cause more alarm among Britons than the possibility of giving up their own currency. At a public meeting last week in London organized by the anti-EC Campaign for an Independent Britain, lawyer Leolin Price warned that sacrificing sterling would mean giving up Parliament’s control over such matters as taxation and interest rates. As Big Ben, symbol of Britain’s age-old tradition of parliamentary sovereignty, tolled the hour just metres away, Price declared: “Once we have conceded that, we have given away the keys to government.”

Another contentious issue is political union. It is contained in a proposal that proclaims that the EC should have a “federal goal.” It calls for a joint community foreign policy, new EC powers

over immigration and social affairs, including health and workplace standards, and increased power for the Luxembourg-based European Parliament, which now has only an advisory role. Taken together, the two treaties would amount to the greatest expansion of central powers over European states since the EC’s formation.

Despite that, Britain is the only community member going through an intense public debate on the issue. That reflects the island nation’s traditional standoffish attitude towards the Continent. And the resentment is exacerbated by the flood of directives issued by the EC bureaucracy in Brussels, which the organization’s officials say is aimed at harmonizing national standards. The Sunday Timesoî London recently published a catalogue of such

“Eurolunacies,” as it called them. They included childlabor rules that could prevent schoolchildren from delivering newspapers; food regulations that might prevent Stilton cheese made anywhere other than in that tiny English village from using the name; and a proposal for a standardized European condom measuring 16 cm long by 55 mm wide (the Italians had urged a narrower standard of 54 mm, causing much hilarity in Britain). EC officials protested that the examples were misinterpreted—but they seemed to cement a British perception that the organization is an overbearing bureaucracy churning out useless rules.

With those sentiments clearly in mind, Major has told voters that he is prepared to walk out of Maastricht summit if he cannot get the deal he wants. In a recent Commons debate on the issue, he said that he will not accept any treaty that describes the federal—

known in some British political circles as “the F-word.” But his reassurances did not prevent the Euro-skeptics in his own ranks from warning that the proposed treaties are a trap. Their concern is that by signing the accords now, Britain will be on what Thatcher labelled “a conveyor belt to federalism.” Although she voted for Major’s parliamentary motion on Europe, Thatcher also called for a referendum on monetary union. Major has ruled that out,

and most analysts maintain that Thatcher will not support any treaties that he can negotiate at Maastricht—and that she will openly break with him.

That would damage Major, who has to hold an election by July. But the failure of the Maastricht meeting would have much wider consequences for all of Europe. Most analysts say that the close economic links forged over more than three decades would continue. But

political co-operation would suffer a setback and old rivalries could reappear. “The biggest loser would be France,” said Eyal. “Its greatest fear is of a Germany which translates its economic might into political might—and that would become more likely.” Altogether, it is an outcome that would be no surprise to the cynical Sir Humphrey Appleby.

ANDREW PHILLIPS

A FRIGHTENING NEW HATRED

Neo-Nazis strut in Leipzig with cries of Ausländer Raus! (Foreigners out!). The Ku Klux Klan burns a cross near Berlin. The images have shocked Europeans, including most Germans, and helped to push immigration to the top of the Continent’s political agenda. Suddenly, opinion polls show that right-wing parties in Germany, France, Italy and elsewhere are winning support amid rising public concern over the influx of foreigners. Some mainstream politicians also have escalated their anti-immigration rhetoric to avoid conceding ground to the extremists. When EC leaders meet next week for a summit in the Dutch town of Maastricht, immigration policy will be one of the most contentious issues on the table.

Officials in most mainland countries, especially Germany, want the EC to set immi-

gration policy. They argue that when the community abolishes internal border controls at the end of 1992, it must strengthen barriers around the EC to prevent it from being flooded by Eastern European and Third World immigrants. But Britain is the odd man out. It insists both on maintaining its own policy and on keeping most border controls.

Ironically, the number of legal immigrants to EC nations has actually fallen in recent years, to about 900,000 a year from 1.2 million in 1973, because of tighter entry laws. It is the drastic rise in the number of illegal migrants seeking political asylum that has sparked the crisis. From about 170,000 in 1988, the number of asylum-seekers reached 327,000 last year, with about 60 per cent of them heading for Germany. Far-right groups, including France’s National Front, have openly appealed to voters’ resentment of foreigners. More moderate politicians have also played on those concerns. In France, which has the highest proportion of foreign-bom residents in Europe (about 12 per cent), former president Valéry Giscard d'Es-

taing shocked liberals in September by arguing that citizenship should be reserved for those with a “blood right”—interpreted to mean only those of French heritage.

In fact, demographers argue that the much-feared flood of foreigners is unlikely to materialize. At a recent conference in Paris, Dirk van de Kaa, a leading Dutch expert, predicted that about 925,000 immigrants a year will enter the EC and six other rich European nations over the next decade. The real problem, other analysts say, is that European countries have never adjusted psychologically to the fact that they, like Canada and the United States, have become magnets for immigrants. Said Susan Forbes Martin, a specialist on European population movements at the Refugee Policy Group in Washington: “Europe has become a continent of immigration, but it is still in a state of denial.” Overcoming that will clearly take much more than a summit.

A. P.