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Posts from the ‘Euro’ Category

A future for the UK in Europe

(This is a slightly edited version of my opening statement in oral evidence I gave on 10 July to the House of Commons Foreign Affairs Committee inquiry on the future of the UK government’s EU policy)

It is one of the great ironies of European history that the Member State which has been consistently the most critical of the European project, and where some of the most outlandish and most outrageous myths about ‘Brussels’ are peddled, is also the one which contributes some of the most thoughtful, constructive and frankly necessary ideas about how it should evolve.

The intriguing question is: why do these ideas find so little support among countries and people on the continent? And I think the simple answer is: because the UK has never truly become a full member of the European club. It has always been at best half-hearted about the project to which it signed up almost 40 years ago. That is why at the European Council in December last year it proved remarkably easy for the rest of the EU to move ahead without the UK. This wasn’t just a major policy disagreement; it was the culmination of years of frustration about a Member State which professes to want to be at the heart of Europe but in reality doesn’t subscribe to the core objectives pursued by most other Member States.

But if this was the only challenge facing the EU the solution would be easy. The UK and the EU could each go their separate ways, and everybody would be happy. The reality, however, is that several other forces are threatening to pull the EU apart. The most obvious one is the current euro crisis, which pits members against non-members, but even more significantly, Northern members against Southern members. All across Europe, people are losing faith in the European project. Because it imposes too much austerity, because it costs them too much money, because it’s undemocratic, because it’s too bureaucratic.

The EU project is deadlocked and in danger of collapse. Seen from the continent the UK now looks likely to leave at some point in the next decade. Members of the eurozone can’t agree on a viable way forward. The debate between them is getting increasingly acrimonious. The accession of Turkey to the EU has been put on hold indefinitely as a result of our own internal problems. Popular support for the EU and its policies is at an all-time low. If nothing is done, the most likely outcome is that Member States will leave the EU one by one. Some voluntarily, some against their will, all as a result of the political institutional gridlock caused by our existing Treaty framework.

Yet to allow the European project to fail at this junction in history would be madness, and a Europe without the UK would be unthinkable. There are clearly important issues on which Europeans fundamentally disagree, but there are also many objectives which we share: a commitment to the continued stability and security of our continent; increased prosperity by reducing barriers to trade and promoting free competition; strengthening Europe’s ability to make its voice heard in the world; addressing cross-border, global problems effectively.

I am convinced that a durable solution to the current crisis is possible. It will require at least two things. First, a fundamental redesign of the architecture of European cooperation, to remove the destructive tension currently tearing it apart.  Rather than creating a 2-speed Europe – divided between a ‘vanguard’ and a ‘rearguard’, in the words of Joschka Fischer – or gradually forcing countries out of the existing EU framework we should replace the existing EU with a ‘wider Europe’ organisation focused on regional security and global trade, and a second body with a separate decision-making structure to bring together those countries whose economies are so aligned and intertwined that it no longer makes sense for them to have independent fiscal and economic policies. I call this a two-layered Europe and I’ve set out in my article for ECFR what the broad outline of it would be.

The second thing that is required is a popolar mandate. Solving the eurocrisis and building a new architecture will need thorough public debate and approval in national referendums. We need to learn the lessons of the last twenty years, and in particular those of the 2005 Constitutional debacle and the current eurocrisis. Only by giving the people a real say can we build a new framework that can withstand the test of time. This process should proceed on an opt-in basis, ie: Member States can opt or refuse to join, but they can’t block other countries moving ahead.

Europe needs to find a new way of dealing with the tensions which are causing it to break up. Not by creating various types of second rate membership or by forcing countries out, but by recasting the entire European edifice in such a way that all current members can stay, and new ones can join.

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