Europe 2.0? The EU after the British referendum

Article first published by Policy Network on 24 May 2016.

At a Policy Network seminar on 12 May, plausible post-referendum scenarios were discussed. Brexit or not, one thing is certain: there will be no EU superstate in the future

For Brexiters, history is already written: the EU is on course to become a superstate. Britain had better jump off the train before it happens, and other enlightened nations would be well advised follow suit. Those who have studied European integration in recent years know that this claim is not just gross exaggeration – it is completely misleading. Rigorous understanding of what the EU is today and what ‘integration’ has meant in the recent past is crucial to dispel this myth. It also helps to make an informed judgement on how the UK referendum is likely to impact on the EU, whatever the result.

No federal Europe: the new intergovernmentalism

Most Remainers and Brexiters share one particular assumption: that the crisis in the euro area will force integration in a core group of EU member states and redesign the European project. Little has changed in the British perception since Osborne’s famous suggestion that the eurozone should embrace the “remorseless logic” of monetary integration in 2011. The assumption is largely correct, but there is confusion as to the timeframe and what is meant by ‘integration’. Six years after the beginning of the debt crises, it has become clear that there is a significant share of ‘reluctant Europeans’ not only in the UK, but spread across the euro area. 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. Creditor countries have resisted pressures to depart from the Maastricht surveillance-based architecture.

Such reluctance to supranational and solidarity mechanisms is best understood in the light of the shift from the ‘permissive consensus’ of the early years of European integration to the ‘constraining dissensus’ characterising EU policymaking today. 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 intergovernmentalism’ theory has formulated a number of hypotheses on this new integration course, such as the informal rule of deliberative decision-making (by opposition to the formal possibility of majority voting) and the multiplication of ‘de novo’ agencies with member states representatives – such as the European External Action Service (EEAS), the European Stability Mechanism (ESM) and Frontex – to the detriment of the genuinely supranational European commission.

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