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EU Renewal - A Shaft Of Light

02/12/2016 13:07

Just suddenly, between the gathering crowds, a shaft of light. Some will think that Guy Verhofstadt's suggestion that British Nationals should be able to belong to the EU by paying an individual subscription, much like belonging to a club I suppose, is a good idea. Others will think that it is a bad idea. The important thing about it though is that it is an idea.

It is no surprise that, with Article 50 on the horizon, the attention of commentators has been focused on negotiation and the cocking of snooks. "The Germans want to sell us their cars. We'll extract a good price for that!", "You British want to participate in our markets, well you'll have to open your borders or we'll tell you where to go!", "Want the intelligence from Cheltenham, do you? Well, get into line or we'll just let you get blown up", "Let our expats stay", "Why should we, you bastards, keep paying for Brussels", "Nah, nah, nananah, nah."

It is all very binary and allows column inches to be generated without too much thought. It is also largely beside the point. Debate about our future relationship with the EU means little unless we have some idea of what the nature of the EU is likely to be at the time when we actually leave it. Will it be much as it is now? Or broadly similar at any rate, subject to the odd nip and tuck? Mr Verhofstadt doesn't think so. He sees the current form of the EU as unstable, telling The Times that "The way it is working today, the EU cannot survive every crisis that it faces."

He is surely right about that. It now seems to be accepted that across the Western world people are rejecting the authority of elites who they see as too remote. In the US they have rejected the Washington bubble. In the Brexit referendum they rejected the unanimous advice of the British party leaders. There is likely to be more of the same. Will Mr Renzi win Sunday's referendum and carry through his vital reforms of the Italian political system or will he have to go, leaving Beppe Grillo's anti-establishment Five Star Movement at the helm? Will the Dutch succeed in blocking the EU's Canadian treaty? Will Madame Le Pen be the next president of France? What will happen in next year's German election? What on earth is going to happen in Austria? Some of these things will no doubt go right from the official viewpoint but not all of them. The revolution against the detached elites has far from run its course and, fairly or not, the elite in Brussels is seen as being about as detached as you can get. The current model is no longer viable.

As a Federalist, Mr Verhofstadt sees the answer in a much deeper political union and he is probably right about that too. Those countries which share a currency need to merge their financial institutions and to become a sufficiently tight political union to justify the transfers of wealth that is needed to support the poorer regions. That probably means that the group will be much smaller than the current Eurozone. It will probably be limited to countries with broadly similar economies. For those countries which fall outside this block the strategy must not be one of promoting ever closer union but of looking at those things which the EU needs to achieve for the benefit of Europe as a whole and seeing what it needs to achieve them.

Let's take the market as an example and assume that a wide tariff-free area is good for all concerned. If goods are to be able to move freely across borders, then there have to be common standards, common competition policies, common policies on state aid and a common system of indirect taxation. Without those the market cannot operate fairly and no doubt there are other things as well. It is not obvious, however, why these would include free movement of people or standard employment rights. Those may, depending upon your viewpoint, be very desirable things in themselves but they are not preconditions of a common market.

Then suppose we look at academic research. Here there are obvious advantages to international cooperation but the sine qua non must be reciprocity. Perhaps there are additional things too, such as the giving of visas to researchers.

The idea of an à la carte EU with a series of options and prices and containing one or more closely integrated blocks is superficially attractive. It would have the advantage that countries who wish to embrace a particular option could do so with the consent of their own electorates and remove voters concern that they're going to wind up finding that their country has been irrevocably changed without their agreement. No doubt it would have disadvantages too and perhaps there are other models that would be better. Still, we need to start thinking about them and Mr Verhofstadt's comment that the stifling of criticism of the EU is more likely to harm than to help it rings true. We need free discussion about how the EU can be reformed if we are going to have a way forward should the current political climate make the status quo untenable.

There are, after all, things which European countries must combine, however assiduously they guard their sovereignty elsewhere. The environment is the most obvious one, although perhaps security and intelligence run it a close second. Then there are areas like research where the advantages of common action and cumulative weight are obvious. We will need a framework within which cooperation in these and many other areas can be safeguarded even when countries do not want overall integration. If Mr Verhofstadt can begin a serious discussion on what those structures should be, he will be doing both Britain and the other members of the EU a very considerable favour.

This article first appeared in the Shaw Sheet

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