This amusing episode is further confirmation that the process of European unification had good historical preconditions. In March, the 50th anniversary of the signing in Rome of the Treaty establishing the European Economic Community, which became the prototype of the European Union, and the 15th anniversary of the signing in Maastricht of the Treaty on European Union were celebrated. In addition, five years ago, the euro banknotes and coins began to circulate. Germany, which assumed the presidency of the Council of the European Union on January 1, 2007, announced the resumption of work on the draft of the long-suffering European Constitution. All this gives reason to take a closer look at the present and future of a united Europe.
Much (Little) Europe
Germany took over the baton of the presidency of the Council of the European Union, the most important legislative body of the union, at a difficult time for Europe. The European Union, which has expanded to 27 countries, has faced a host of contradictions in implementing common European policies. Having a huge internal market with a capacity of 480 million consumers, Brussels still cannot approve a long-term legal basis for its existence: the EU has no common legal norms regarding partnerships, companies, or associations. So far, the European internal market is regulated only through directives recognized by all members of the Union. The future of the EU Constitution is also unclear; its draft was rejected in a referendum in 2005 by the citizens of France and the Netherlands. (In 2004, the EU member states signed the Treaty establishing a Constitution for Europe, but it will enter into force only after each country ratifies it.)
The split between supporters and opponents of integration has intensified. Luxembourg Prime Minister Jean-Claude Juncker describes it as follows: «One half of the population in almost all our states, in all parts of the continent, would like a greater Europe, a better Europe, a Europe that will continue integration. And the other half of the population thinks that there is already too much Europe. Finding simple solutions in this situation is not easy.»
In May 2004, the EU admitted Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, and Hungary, which were part of the Soviet bloc during the Cold War. But a year earlier, relations between old and new Europe had already cracked: unlike the main financial donors of the EU, France and Germany, the candidate countries supported the US aggression against Iraq. Shortly after, at the EU summit in Athens, French President Jacques Chirac had to remind: «Europe is collective aspirations, shared discipline, firm solidarity, and a natural sense of being a European family.»
Michurinists
The shift of the EU's borders eastward did not significantly strengthen the EU's economic power. The number of countries increased by 40%, the population by a third, but GDP grew by only 5%. The old EU members allocated tens of billions of euros to modernize the economies of the new neighbors, but they still talk about injustice. Thus, Czech President Vaclav Klaus, just a month after his country's entry into the EU (by the way, on terms much less favorable than Poland), stated at a conference in Munich: «Everything indicates that the Czech Republic is destined in the near future to be a net contributor, not a recipient of EU funds. This sharply contrasts with the situation of Greece, Ireland, Spain, or Portugal when they joined the EU… I do not foresee any noticeable effect from the fact that new members can now influence decision-making processes in the European Union: they are not sufficiently prepared and will remain in the role of junior members for a long time… The most serious obstacle to their effective participation in decision-making is the deficit of democracy in the EU, whose degree of bureaucratization reduces their chances to almost zero.»
Many European politicians fear that Brussels' attempts to put in order the decision-making mechanism within the EU will result in excessive centralization and simplification of democratic procedures. Therefore, today in Europe it is increasingly said that until all issues regarding the procedure for adopting consolidated decisions are resolved, the EU's doors will be closed to new members. After the accession of Romania and Bulgaria to the EU on January 1, 2007, only Croatia has a real chance to come under Brussels' wing in the next seventy years. European Commission President José Manuel Barroso directly stated in September 2006: until the fate of the EU Constitutional Treaty becomes clear, the enlargement process should be temporarily halted.
In Europe, they are trying to understand the nature of European integration, where the main point of attraction for the states located on the continent lies. In 2000, leading European political scientists and futurologists held a conference where the future of the EU was discussed. A long discussion, moderated by the famous philosophers Jürgen Habermas and Jacques Derrida, led to the following conclusion: the nature of European identity is defined within the framework of the problems created by globalization, and primarily by the attempt to build a unipolar world under the leadership of the United States.
The EU includes a very influential player and a powerful conduit of US interests – Great Britain. Some political scientists believe that the current EU crisis has its origins in 1973, when Britain, along with Denmark and Ireland, was admitted to the European Union. Britain did not come alone, but hand in hand with America, which began to muddy the waters. The peculiarity of the British position is well illustrated by a report by UK Chancellor of the Exchequer Gordon Brown at the Fabian Society conference in January 2006, which begins: "What does Britishness mean? Should it be preserved and why?" In a half-hour address on his country's geopolitical interests, Brown managed to avoid the phrase "European Union". Touching on the topic of integration, the influential politician speaks of the need to search for a British, not European, identity. According to Brown, only when the British define their values will a new "global Britain" emerge: "A country for which membership in a united Europe will be of paramount importance, which will help a reformed, more flexible and outward-looking Europe begin to play an important role in the global community, and will help improve relations between Europe and the US."
Thus, the globalization process has created a situation where the line between the EU's foreign and domestic policy has practically disappeared. Now each EU member state must consider its own interests only through the prism of strengthening the community's international influence. Brussels still has to learn to respond effectively and timely to the challenges facing the global community.
Keep your hands off Bochum!
Despite the fact that the European integration process began with the Coal and Steel Union, i.e., it had a very concrete business foundation, today the EU has no fewer problems in the financial and economic sphere than in the political one. The same open and sharp competitive struggle with the US and Japan is observed here. "Europe will be able to use its weight only if it has a strong and dynamically developing economy," says German Foreign Minister Frank-Walter Steinmeier. "At the same time, Europe needs an economic system that combines competitiveness with social and environmental responsibility."
EU statistics inspire optimism. In 2006, economic growth in the Union countries was 2.8% (1.1% more than in 2005). In the first half of last year, exports from the 25 EU countries reached almost €600 billion: this is 20% more than in the same period of the previous year. Inflation remained virtually unchanged over the year, averaging 2.3%. The unemployment rate decreased. However, if you look at the underlying processes and, above all, at the inconsistency of actions among EU member states, optimism wanes.
Here is an illustration of the topic of a common energy policy European-style: without waiting for consolidated decisions within the Union, in November of last year, the Italians signed gas supply agreements with RAO Gazprom and the Algerian company Sonatrach within a day of each other. In response to critical comments from Brussels, the witty Italian authorities suggested considering these agreements as "a model that Europe can follow when it begins to speak with one voice." Italian Minister of Economic Development Pier Luigi Bersani stated that he and his subordinates had not slept for weeks, striving to ensure their country's energy security, but he would very much like this issue to be included in the context of European strategy…
One of the key problems of the European Union is the unevenness of the economic space. The so-called "core of Europe" (the territory located along the line connecting London, Paris, Milan, Munich and Hamburg) generates more than 50% of GDP across the 15 "old" Union countries. This involves 20% of EU territory and 40% of the population. It is hard to even imagine the gap in living standards between Bucharest and, say, Cologne. (By the way, it was in Romania that magnificent live sets were found for filming post-Soviet Kazakhstan in the movie "Borat".) Therefore, the EU's spatial development strategy focuses on the development of specific territories. Key EU documents repeatedly mention the concept of "subsidiarity". Its essence is that within the vertical line of authority, only those problems that cannot be solved at a lower level are transferred to a higher level. This idea is very well understood in the Federal Republic of Germany – a country where the degree of centralization of management processes is minimal.
Germans react very sharply to EU attempts to intrude into the sphere of local self-government. Professor Franz Lehner, president of the Institute of Labour and Technology of the North Rhine-Westphalia Science Center, recounts: "I live in the small town of Bochum near Düsseldorf. Along the old railway line, they began to lay a bicycle path. When the work was finished, residents saw a billboard: 'Built with EU funds.' Such audacity outraged the citizens: they pay taxes, most of which stay in the city, and a smaller part goes to the federal center, from where some more is sent to EU structures. That is, the EU takes our own money and builds us a bicycle path with it. This way we will quickly create a centralized state where local authorities are not trusted and the capabilities of high officials are overestimated. Let the EU keep its hands off Bochum – a municipal entity!"
In Brussels, there is increasing talk about the need to introduce a special "EU tax"; then, they say, the burden of maintaining the Union's institutions will be fairer (currently, the most developed EU countries contribute more money to the common EU budget than they receive), and citizens will begin to better understand the intricacies of tax policy.
In Germany, excessive centralization of the European Union also causes indignation at the state level. When the authorities of Lower Saxony once again received decisions made in Brussels belatedly, and not from Berlin or Brussels, which would have been more logical, but from colleagues in the state of Saarland, they decided to open a representative office to the EU. The authorities of Bavaria, Hamburg, and other large German territories took similar steps. Representatives of the states do not have the right of legislative initiative in the European Parliament. Their main task is to attend numerous receptions and buffets in EU offices and to extract information.
According to Ulrike Kulo, a member of the Landtag of Lower Saxony and a member of the Committee on Federal and European Affairs, the German state authorities have created an "early warning system" among themselves regarding initiatives of Eurocrats: "Now we can directly, bypassing Berlin, receive fresh information from Brussels, where the EU Council and the European Commission work. This is important to us for two reasons. First, from time to time the EU makes decisions that directly affect us. For example, about nature reserves. As if Brussels knows better the condition of our reserves. Second, some EU norms can have a significant impact on the budget of Lower Saxony. For instance, a set of measures on competition development is currently being discussed in Brussels, in particular a sharp reduction in the volume of industrial assets owned by state structures. And according to a law from the 1960s, Lower Saxony owns a fifth of the shares of the Volkswagen concern."
While political decisions are increasingly shifting to the competence of Brussels, there is no sign of integration in taxation. In the practice of tax officials, borders remain, which causes many conflicts in Europe. For example, after the VAT rate in Germany was raised by 3% from January 1 of this year, German goods became more expensive than Dutch ones. Stores located on the border with the Netherlands lost their competitive advantage and are now counting their losses. Moreover, several Dutch retailers have launched projects to build shopping centers along the "non-existent" border with Germany.
Movement is life
More than half of the legislative initiatives discussed in EU member states today originate in Brussels. Since 1979, when the first universal and direct elections to the European Parliament were held, its influence on European politics has increased many times over. Now the most popular profession in Europe is lawyers. Thousands of people make money by interpreting new laws.
The EU's economic reforms aim to strengthen competition and reduce the share of industry in favor of services. And the growth of the service sector on a continental scale is impossible without high labor mobility. People must move freely in search of better conditions and thereby stimulate competition. But the process of creating pan-European firms is too bureaucratic. National authorities and companies do not welcome newcomers from other countries. The low labor mobility in the EU is characterized by the following indicator: in the eurozone, less than 0.1% of the population moves to a new place of residence each year (before the accession of Bulgaria and Romania, Poles and Portuguese were the most mobile), while in the US it is 2.5%.
Experts believe that dismantling legislative and administrative barriers in the services sector could increase GDP by 1.8% and create 2.5 million jobs. The process of creating a single services market is still stalling. Conflicts arise even between countries that are close in mentality and business practices. In January 2007, the European Court received a lawsuit from the Latvian company Laval un Partneri, which had won a contract to build a school in the Swedish town of Vaxholm. The defendant was the Swedish trade union association, whose representatives blocked the entrance to the construction site for Latvian workers. The reason is that Laval un Partneri, working in Sweden, chose to be governed by Latvian labor law (less strict and more favorable to business) and signed an agreement with Latvian trade unions. This outraged the Swedes: they believe that the company must comply with the labor standards of the country where it works, not where it is registered. A court decision in favor of the Latvian firm would give impetus to the development of the pan-European services market and increase labor mobility, but at the same time, the old, overregulated Europe would lose to the young, more competitive one.
Saving Czech goulash
Brussels initiatives generate widespread debate in European society. The eternal confrontation between France and Germany for the title of the homeland of liver pâté faded into the background after the emergence of pan-European norms for public catering. According to EU rules, any dish in cafes and restaurants must be sold no later than four hours after preparation. But Czech goulash – like our borscht – should steep for a day or two to become tastier. Czech restaurateurs defended the country's culinary sovereignty: a conciliation commission was established, and the EU had to back down.
In Germany, public associations of publishers and advertisers have been opposing attempts by EU officials to ban advertising of alcohol, tobacco, and overly fatty and sugary products for 12 years. Anja Pasquay, press secretary of the Federal Association of German Newspaper Publishers, explains: "Brussels believes that advertising of harmful goods, especially involving young models, threatens citizens' health. We, on the other hand, believe that a company that legally produced cigarettes or alcohol should be able to advertise its product. This is an element of freedom of information. We have been supported by some members of the Bundestag, representatives of the tobacco industry, and the advertising producers' union. Together, we commissioned a study to find out whether a person smokes because they are influenced by product advertising, or whether they independently made a fundamental decision to smoke, and advertising only helps them choose a brand of cigarettes. The results, which we sent to Brussels, showed that cigarette advertising is not propaganda, but merely information about the product."
Reason to Celebrate
The creation of the European Union is a project requiring a heightened sense of civic responsibility. However, the EU is reaching a new stage of development at a time when interest in politics is waning on the European continent (as well as in the world). A phenomenon arises that former French President Valéry Giscard d'Estaing called "the exhaustion of democracy." It is noticeable, at least, in the sharp reduction of political stakes in European bookmakers, and the airtime allocated by television channels to political debates and news. On one hand, people want simplicity in the presentation of information. On the other hand, the actions and decisions of politicians are becoming increasingly complex, with more contradictions and paradoxes woven into the fabric of real politics. Government officials traditionally blame the press for all sins: they say it does not create a politically enlightened viewer and listener who understands the nature of certain unpopular decisions, and the absence of such an audience boosts the ratings of fringe politicians. No doubt, the press is largely guilty of irresponsibility. But are politicians themselves responsible enough? Their inability to communicate with ordinary citizens was clearly demonstrated during the work aimed at promoting the EU Constitution.
The crisis of European integration is a good reason for Europe to show the world how to solve systemic problems in the 21st century: through education and culture, the inviolability of individual rights, and the pursuit of a just world order. The global tasks facing a united Europe are evidenced, if only by the fact that back in 1994, the European Union adopted a resolution on studying the risks of our planet colliding with asteroids.
Today, the fate of the EU largely depends on Germany. Luxembourg Prime Minister Jean-Claude Juncker believes this is a great stroke of luck for Europe: "Germany is the European country with the largest number of neighbors, and therefore the country bearing the greatest responsibility in Europe and for Europe in the world. Germany knows what to do with this responsibility. It has developed the ability to listen to others—whether big or small, close or distant relatives."