FEPS Fresh Thinking

In an interview he gave last week to the German ARD channel on Europe and the European Union (EU) referendum, British Prime Minister David Cameron stated, that in order to deal with the number of challenges Europe is currently faced with, we need to recognise that the Union is an “organisation that needs the flexibility of a network”.


What is wrong with this statement?


Screen Shot 2016-01-14 at 11.15.48Primarily, that the EU is neither merely an organisation nor a network! Europe is first and foremost a Union with a history of over 50 years, and not just a network of different national economies forming a single market. Since the Treaty of Rome in 1957, EU member states have progressively developed a set of national and collective regulations and institutions that cover areas much wider than just competiveness and flexibility.


In this sense, when discussing the challenges of our European societies, we should not focus on how we can downgrade our Union to a mere network, but rather look at the actual causes behind these challenges that we are currently facing so as to understand how we can best move Europe forward.


For example, one cannot simply overlook the fact that the dominant line of economic thinking in the past decades has been the neo-liberal approach and that therefore this approach is partially to blame for Europe’s economic woes. The core idea of neoliberalism is reforming the post-World War II social-market economies, liberalising them and implementing more free market driven policies in order to ensure competitiveness and a sound economic performance at the national, European and global levels. Such policies were expected to provide incentives for employment and at the same time for social security and stability. But as a result, competitiveness became a narrow evaluation criterion measured only in terms of productivity and growth, decoupled from the quest for improvement of living and working conditions for all.


It was not long before the dramatic consequences of the economic and financial crisis rightfully brought people onto the street to express their discontent with the rules dictating the way the financial sector functioned, which only served the markets while causing a further dramatic growth in inequalities. These were the “Indignados”, the Occupy and the 99% movements.


Yet, when these movements appeared, their arguments were not taken seriously; there has instead been a shift towards so-called “necessary sacrifices”, which under the name of “austerity” were proclaimed to be “the only solution” for Europe and its member states. The reasoning behind such thinking was the alleged requirement of rules-based processes to balance public budgets and reduce rising sovereign debts. This reasoning was irrationally linked to the macroeconomic argument that supply creates its own demand, which calls for structural reforms to attack the rigidities on the supply side that are seen as harmful to growth and jobs.


When these recipes failed to bring Europe out of the crisis, we were then told that the financial crisis is not only a crisis of the financial sector but is more and more a crisis of sovereign debt due to overspending by the public sector. Consequently to solve and fix the problem, the proposed solution was to cut public spending in order to avoid further debt increase and restore our societies’ path to growth and economic and social stability by giving back flexibility to the markets. When even this strict austerity dogma failed, we started hearing that it is the European acquis communautaire, this common set of treaties, legislation, rules, agreements and standards, that binds all EU states together, that is partially responsible for the situation in which the EU finds itself today.


And yet, after almost 7 years of crisis, it is the failure of these strict austerity policies that is more than evident.


In this sense, it is crucial to focus our energy not on dismantling our Union but rather on tackling the core tensions that seem to be drifting the EU, Member States and Sister parties apart. In relieving these tensions, we should avoid the game of overpowering one another with presumptions and labels, but we should rather work to identify those aspects that can bridge any existing divisions and serve as an anchor for a new European unity.


In the economic sphere, where tensions remain the back pain of the Union, we need to recognise that slow recovery (regardless of drastic cuts disguised as “austerity policies”) is not going to improve anything – to the contrary it will further worsen the situation. To that end, the EU economic integration process that used to be the engine of European integration but which has lately started lagging behind different other processes, should be utilised once more as a vehicle towards progress for the Union and its people.


In addressing social tensions, that have been dominant amongst younger generations, posted workers, employees within atypical contracts, those up to retire and many others, we have to understand that while the European integration process might have resulted in the common market (alongside a European labour market underpinned by the European Social Model), the actual implications of that process have not yet been uniformly successful. On the contrary, in the last one and a half decades, there have been two strategies – the progressively designed Lisbon Strategy and the more conservative EU2020 one –, which failed to deliver on the ambitions. When coupled with other failures in regulatory attempts, such as the infamous Bolkenstein Directive on public services and the subsequent rulings of the European Court of Justice on the infamous cases of Viking or Laval, one can easily see that it is high time for proposals, if one wants to overcome these European missteps. A stronger focus on education, employment and social policies within the EU agenda is urgently required in dealing with the inherent social tensions within the EU, as exhibited by the so called “5 Presidents Report”, which alongside the resolution of the European Parliament on the European Commission’s work plan 2016 and the 2015 State of the Union address, all announce the opening of a new debate that will be held under the motto of “social rights”.


What is more, in countering the mindset tensions that exist between contemporary demands and modernity, we need to acknowledge that society is changing fast and that technological progress is a fact, without trying to comprehend these processes with the out-dated vocabulary and concepts of the industrial revolution. For that reason, ‘reindustrialisation’ should not turn into a nostalgic and hence not credible term, but should instead describe the new model of production, participation and consumption that progressives want to create.


Finally, from a political point view, we should indeed have an honest look at how the Union functions, with a view to tackling the democratic deficit that does exists in the way many of the decisions are taken but also bridging the gap between the EU collective institutional and individual EU member states ambitions. Time and time again, we have seen phenomena where new ‘Iron Curtains’ are being raised, as in the recent battle around the allocation quota of refugees. This has to stop. In answering the question of ‘how much Europe we want’, we need to move towards a status quo where the European and the national interest are perceived as mutually reinforcing.


Such a status quo will be beneficial both for Brussels and the national capitals, since it will allow Member States to feel better protected by the Union, and the EU itself to act more in the interest of its European citizens.


For all of us who believe that the EU is not (or should not be rendered) simply a network, this is a mission worth fighting for. And this can only be done if we all work to Europeanise the EU more.


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