What future for the European Union: Integration or Cooperation?

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Following the Dutch 2021 election, Dutch Professor of European Public Administration Adriaan Schout, who teaches at Radboud University Nijmegen, outlines a long term vision for the European Union, in an essay for www.BrusselsReport.eu. He thereby maintains that the Netherlands typically would rather see cooperation between strong Member States than to have the European Commission play a leading role. Professor Schout is also a Senior Research Fellow at Clingendael, the Netherlands Institute of International Relations.

The EU clearly is a federation supported by binding legislation to allow for the creation of the internal market and complemented with a dense network of diplomatic and political relations, and that’s a good thing. Then, what kind of federation? Is it evolving in a direction that is best suited to the European context? Is it the kind of Union that the Netherlands wants? The fact that Brussels is talking about European ‘integration’ and the Netherlands about European ‘cooperation’ reveals the tensions facing the EU. It also underlines differences between the Netherlands and the ambitious president Macron who is leads the pleas for deeper integration – even though De Gaulle was the champion of European cooperation

The EU has proved susceptible to profound crises in a number of areas. The euro crisis continues to linger, there is a crisis of rule of law, Eastern European countries are not complying with agreements on taking in refugees and migrants, and cooperation in health care is faltering. There is also strong dissatisfaction with a number of small Member States that facilitate tax avoidance (including the Netherlands).

The EU is so crisis-prone that the previous Commission president, Jean-Claude Juncker, claimed that it is facing a ‘polycrisis.’ In alarmist terms, he described the European Commission, which he headed, as ‘the Commission of the last chance.’ Ursula von der Leyen, the current Commission president, also wants to forge ahead with European policy to protect citizens from economic setbacks, an unstable outside world and threats to public health. However, Member States tend to oppose further integration. The President of the Commission therefore wishes to go over the heads of government and hold large-scale consultations in order to involve citizens more closely in European ambitions.

Some countries were battling high unemployment even in the good years before the corona pandemic. Spain, for example, had 15 percent unemployment. The financing of European plans, including the recently established COVID-19 recovery fund, is yet to be organised. Member States are arguing about how the recovery budget should be repaid and whether European taxes could be used. One reason for establishing the COVID-19 budget was to placate countries like Italy and Greece, who feel that the EU is not doing anything for them and want to see solidarity.

It is the fundamental differences between the Member States that make Europe so susceptible to crisis. Countries have different post-war histories, administrative traditions and characteristics, as well as political preferences and social values.

How can we encourage Member States to reform?

There are also ongoing major differences in terms of economics. When the coronavirus pandemic erupted last year, only seven of the 19 eurozone countries had their national debt under control. The combination of persistent unemployment and high national debt also shows why the euro is struggling: the majority of eurozone countries aren’t experiencing sufficient growth. While Member States are generally able to reduce expenditure, introducing reforms to improve competitiveness is proving a lot more difficult. The weaker Member States don’t seem to manage to reform labour markets, education, infrastructure and national administrations.

That is why the Dutch Minister for Foreign Affairs, Stef Blok, recently asked a group of EU experts how we can encourage Member States to reform. The fact that the government is asking this question shows just how serious the situation is. The euro has reached a point where policymakers in The Hague, always keen to initiate or amend European policies, are now almost at a loss as to how to proceed.

If we look at how the euro is managed, we see no shortage of attempts to strengthen the currency. Over the past 30 years, the rules have been constantly expanded, tightened, relaxed or simply abolished. This comprehensive system of obligations, scrutiny and potential fines is proudly displayed on the Commission’s website, now resembling a kind of Christmas tree. Others describe the entire edifice of euro measures as a medieval cathedral with its niches, aisles and annexes.

Despite all these measures, Member States have been drifting further apart. Since tighter integration doesn’t seem to be working, we are clearly on the wrong track.

Questioning Europe’s ultimate purpose is confronting 

We therefore have to ask: what kind of EU are we building? Politicians prefer to avoid this question about Europe’s ultimate purpose (‘finalité’) because it’s so confronting. The policy of incremental steps towards integration is less transparent and doesn’t lead to referendums producing “no votes”, like in 2005.

However, we need to know what kind of federal model policymakers have in mind, because that will influence the choices they make. In southern Europe, a fully-fledged, centralised federation may be less of a problem, even if the lack of democratic consent has been the subject of a lot of protests when the “troikas” were descending into capitals subject to bailout programmes. Anyhow, politicians from northern countries prefer to operate pragmatically, which leads to patchy solutions.

Former EU Commission President Jean-Claude Juncker, for example, said that he didn’t want a European superstate, and yet his proposals certainly went in that direction. The Netherlands wants horizontal cooperation (between Member States) but argues at the same time that ‘a deal is a deal’, which means a strong European authority is needed. There are other examples of European confusion: the European Commission wants to be an independent supervisor and a political body at one and the same time. But you can’t be both judge and politician. Nor is it possible to have grand ambitions while ignoring the need for effective monitoring and enforcement frameworks.  There is no coherence between its strategy (ambitions) and administrative capacities (structure). In the business world, such a lack of vision would be viewed as mismanagement.

In European parlance, the European finalité is captured by the term ‘integration’, used by the Commission and most Member States. Dutch policy documents, on the other hand, refer to ‘European cooperation’. Dutch Prime Minister Mark Rutte talks about cooperation between countries that are financially independent.

This reveals a fundamentally different view of the relationship between the European Union and the Member States. In the EU, this relationship is regulated by the well-known principle of subsidiarity, which determines whether or not tasks are delegated to the European Commission. In the EU, subsidiarity means a vertical separation of tasks. The Netherlands, however, would like to see horizontal cooperation between fully-fledged Member States. This leads to a fundamentally different understanding of Europe’s crises. According to the Commission, the EU is underperforming and there is a need for further integration (read centralisation). In the Dutch view, the Member States are faltering.

There are two problems with the integration model. More vertical integration won’t work and Member States ultimately want to retain their competences. Can ‘cooperation’ offer a more suitable basis for interconnecting the diverse European nations? Yes, but the Netherlands has to develop and promote its vision of the EU.

Centralising powers doesn’t work in a complex organisation like the EU. Large organisations have to decentralise. Ultimately, it’s the strength of the parts that determines the strength of the whole – internally as well as externally, in geopolitical terms.

Cooperation leads to success stories

The weakness of the Dutch vision, is that it lacks a narrative on how to reform Member States. There is not enough trust between Member States. Worse still, most Member States don’t even trust themselves and they therefore expect a lot from the EU. Tellingly, polls indicate that citizens in 21 out of 27 Member States trust the EU more than they trust themselves. A top European official, somewhat desperately, called Member States ‘a basket of bad apples’.

A key reason for taking the Dutch cooperation narrative seriously is that it is cooperation that will lead to a strengthening of the Member States. The EU has succeeded in resolving deep crises and it is cooperation that has created European success stories. Sectors in which European integration has succeeded include aviation, the authorisation of medicines for the internal market and competition policy.

These are sectors in which the Member States fought one other for decades because of huge economic, political and cultural interests. Mad cow disease threatened public health, confidence in the European food industry collapsed, global trade barriers were erected and Member States refused European inspections of abattoirs. Today, European food has a great reputation across the globe. So things can work in Europe.

Where crises have been resolved, the focus has been on cooperation. Member States were forced to share their expertise, to carry out inspections on one another, and to build new governance structures to enable weak Member States to take part in the new European network. Teams of national officials travel through the EU to assess one other. This can result in a harsh assessment, but next time, it will be the turn of another Member State. This creates the professional culture that is needed in the EU. It creates a new – horizontal – power base in Member States. Through policy, standards are imposed, and through orchestrated cooperation, the right organisational environments are created. Cooperation equals European integration from below. Just look at Dutch tax policy reforms to see how this works. The Netherlands has listened.

Cooperation pushes responsibility back to Member States and countless national representatives will need to prove that they are reliable colleagues. Airlines can have their aircraft serviced in Eastern Europe because there is confidence in the monitoring system that ensures that the strictest requirements are met. It is by enforcing cooperation that the EU has been able to work on strengthening national sectors and hence on building trust.

We therefore need to foster cooperation in the EU, to put as many national officials and politicians as possible in a situation where they have to prove themselves. That’s why it is dangerous for the European Commission to centralise competences. The primary job of the Commission should be to organise cooperation. The euro crisis is persisting because the Commission is monitoring the economic policies of Member States, rather than ensuring that Member States’ policymakers assess each other’s economic policies and structures in a transparent, business-like manner. What the EU needs is a managerial vision rather than a vision focused on integration. As a result, subsidiarity should not be interpreted vertically, in legal terms, but horizontally, in administrative terms. These are the foundations of a new European paradigm which offers more prospects than calls for deeper integration. Let us hope President Macron is listening.

This essay was originally published in Dutch, by Elsevier Magazine. It is a shorter version of  Professor Schout’s inaugural address at Radboud University Nijmegen. A full version of the lattercan be found here.

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