The UK Referendum Debate

British Foreign Secretary Philip Hammond was in Rome yesterday, 25 November, outlining his government’s strategy for reforging the relationship between Great Britain and Europe.  The event was hosted by the British embassy in cooperation with the Istituto Affari Internazionali (IAI).

Secretary Hammond’s remarks paved the way for a wider conversation about how any renegotiation of Britain’s role in Europe would affect Italy, and what the Italian government should do.  My role was to offer an ‘academic’ perspective — as James Politi, our moderator, put it.

I always worry in those situations that ‘academic’ is offered as a euphemism for ‘irrelevant’.  The point I wanted to make is that we need to think carefully about how European integration works and what are the objectives.  I also wanted to insist that this conversation is too important to elites (or academics).  I am not a fan of referendum politics, but I am sympathetic to the view that there needs to be a focused public debate.

This is hardly the first time I have made the argument either in general or in the context of the UK referendum debate.  To show you what I mean, I have dredged up a short paper that I wrote for a conference that was organized by Sara Hobolt at the LSE in January 2013 — the day after David Cameron gave his Bloomberg speech calling for a referendum.  I re-read that paper as preparation for the Rome event.  It is a little dated in some respects, but the argument holds up.  I hope it will make some sense.

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National Politics Cannot Cope with Much More Integration

Either Within Countries or Between Them:

Then again, maybe it can

 

Erik Jones

The Johns Hopkins University SAIS

The question about whether national politics can cope with much more integration hinges on two notions. One is integration. The other is the willingness to participate. Neither of these notions is easy to operationalize and both are poorly understood as a consequence. That makes it hard to predict what will happen – which explains why the title of this short memorandum is so ambivalent.

David Cameron’s speech yesterday provides a good starting point for analysis. He insists that integration is an instrument and not an objective. He also argues that integration is not the same as harmonization. These are both reasonable points. Moreover, they apply as well within countries as between them. Consider the United States. The Constitution leads off with a preamble describing ‘a more perfect union’ but that is only one of a list of objectives that includes justice, tranquillity, defence, welfare, and liberty. Moreover, it is the only objective with a qualitative modifier attached to it. You have to wonder if the measure of perfection does not lie in the attainment of the other goals. That is true particularly once you get to the Bill of Rights that amend the document.

There is plenty of scope for policy variation across U.S. states. Although the Supreme Court has interpreted the interstate commerce clause to give sweeping powers to the federal government over market institutions, you still see huge differences in employment protection legislation, work place representation, taxation and social benefits from one part of the country to the next. Moreover, there is little appetite in U.S. politics to see those differences legislated away by the federal government even under the second Obama administration. Obama admitted as much in his second inaugural address:

we have never relinquished our skepticism of central authority, nor have we succumbed to the fiction that all society’s ills can be cured through government alone. Our celebration of initiative and enterprise; our insistence on hard work and personal responsibility, these are constants in our character.

Of course the Rome Treaty is not the US Constitution, and it does refer to ‘an ever-closer union’ rather than a ‘more perfect union’. Proximity seems more unidirectional than perfection, which can have a Goldilocks balance to it. Then again, union can have different connotations. For example, the pre-amble to the Rome Treaty also includes a passage which suggests that unity is developmental rather than being institutional in character:

ANXIOUS to strengthen the unity of their economies and to ensure their harmonious development by reducing the differences existing between the various regions and the backwardness of the less favoured regions . . . .

By implication, an ever closer union of peoples may be a place where countries are all at similar levels of prosperity. This would explain why the signatories of the Rome Treaty affirmed ‘as the essential objective of their efforts the constant improvement of the living and working conditions of their peoples’. I am not trying to deny that harmonization played a role in the early stages of European integration. Rather the point is there have been many instances when harmonization has failed and European institutions have had to look to other means to move forward. In some cases, the institutions have even found ways to use diversity to spur integration – as through the mutual recognition of national voluntary industrial standards to complete the internal market or the introduction of a principle of differentiation to spur enlargement to Central and Eastern Europe.

If unity means developmental equivalence, however, that makes it hard to assign meaning to ‘integration’ – particularly when harmonization is only one pathway among many. This is where it helps to look for synonyms or alternative ways to express integration as a concept. Existing analysis of European experience is weak on this point, in part because so much of it treats Europe as sui generis. That is another reason to draw on notions of national integration. The argument is not that Europe is going through the same process of nation-building that took place within European nation-states, rather it is that there is something analogous to what is happening across individuals or groups within countries (We the People) and across countries within Europe (Union of Peoples).

The Swedish economist Gunnar Myrdal had an elegant solution to this problem. He argued that integration both within and between countries is the promotion of equality of opportunity. This, he explained, is the liberal ideal. Individuals should compete on a level playing field within countries; countries should compete on a level playing field both regionally, as within Europe, and at the global level. Moreover, the normative use of the word ‘should’ is intentional insofar as integration entails progress. Myrdal saw no contradiction in harnessing progressive policies – mandatory schooling, free access to health care, state pensions, development aid and the like – to the liberal ideal. The state has a role in levelling the playing field both at home and abroad.

This progressive notion of integration is more consistent with Obama’s second inaugural than with Cameron’s conception of Europe. Then again, the two executives are using different frames of reference – one national and the other international. To make them directly comparable, they would have to speak at the same level of aggregation. The reason, as Myrdal explained, is that the institutions created to promote equality of opportunity at the national level often do not fit well with the institutions that promote equality of opportunity across countries. Worse, progressive domestic institutions tend to put countries at a competitive disadvantage internationally. Obama recognizes this tension explicitly in his analysis of globalization; Cameron sees the same problem within Europe. Moreover, both politicians agree that domestic priorities should predominate so much as possible. As Cameron insisted, democratic legitimation takes place in national parliaments.

That is where the willingness to participate becomes important. Much of the analysis of Europe starts from the assumption that willingness to participate is somehow positively correlated with identification. The more individuals identify themselves as European, the more likely they will be to lend support or allegiance to the European project. This assumption is not entirely misguided. Identification is a normative process that is steeped in cultural values and the more European institutions promote the values cherished by individuals, the more likely they are to cherish European institutions in return. Nevertheless, using identity as a proxy for the willingness to participate in Europe has a number of pitfalls.

To begin with, it rests on a mistaken analogy with nation-building where individuals form a People and not a union like we have in Europe where different Peoples benefit from equality of opportunity – because the opportunities that are important to individuals and the opportunities that are important to whole communities are not the same. This distinction is easier to see within countries than between them because where the contrasts between communities are sharply drawn within countries they tend also to be destabilizing. Often, the only way to restore stability is to create institutions that give equal opportunity to groups even if this means that the implications for individuals are very different from one group to the next. The post-Second World War history of Belgium is littered with illustrations of this dynamic.

A second problem with using European identity as a proxy for willingness to participate in the European project is that it glosses over the possibility of unintentional institutionalized contradictions from one level of aggregation to the next. It is one thing to say you are European; it is something else entirely to say that you are willing to sacrifice your right to early retirement in the interests of ‘Europe’. Of course the easy way to square the circle is to insist that early retirement, or limited working times, or any other specific labour or product market institution is an essential component of the European social contract. Unfortunately, such assertions turn the problem of identification on its head. Either you accept specific institutions, or you are not one of us. That is the French reaction to Cameron’s call to renegotiate aspects of the internal market.

The problem disappears if we drop the use of identification as a proxy for willingness to participate in Europe. The challenge for analysis is to get at that willingness more directly. Myrdal had a solution for that as well. He argued that solidarity in integration is agreement to abide by the rules of the game – the rules that level the playing field and so ensure equality of opportunity. Cameron would probably agree. Twice in his speech he accepted that a common market requires a common legal framework and that participation in any club entails following the rules. The point he stressed is that not all of the rules are strictly necessary to promote a level playing field and some may actually get in the way of that objective. There is some measure of truth in this claim. There is even greater truth in Cameron’s assertion that European rules should be judged against the goal of integration, which is not ‘Europe’ per se but the many advantages that the promotion of equality of opportunity across peoples might bring.

If more integration makes it easier for both individuals and groups to achieve prosperity and a wide range of other objectives, then Europeans are likely to support it both within countries and between them. However, there are many instances where that might not be the case, both domestically and across Europe as a whole. If Europeans find their objectives being stifled by national institutions, they are likely to agitate for greater decentralization like we see in Belgium and Spain. If they see Europe as an obstacle to national progress, they are also likely to reject integration. This is the argument made UKIP, Tory backbenchers, and Silvio Berlusconi, and it is finding popular resonance. And if Europeans see no connection between the European project and the promotion of equality of opportunity they will likely prove indifferent. They won’t be able to cope with much more integration because they won’t understand why it is worth the effort.