Volume , Number 0
Europe in Ten Questions
Redistricting Returns With A Vengeance
Repairing the damage
Democracy and the War on â€¦
Jonathan lawson and susan Gleason
Unions Must Tap Young Workers
2001 In Music
The Fruits Of NAFTA
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Journal of 15th Year
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Europe in Ten Questions
Why we should be concerned about the European Union
Few people feel very concerned about Europe. Why is the European Union so important?
Most people underestimate the importance of the European Union. When the average family income in Belgium is comparatively lower than it was 20 years ago; when more and more young people survive on the legal minimum income; when one has to work longer and harder to maintain one's living standard; when women are given the “right” to work at night, then European integration is at work. The shutting-down of Renault-Vilvoorde; the restructuring of Opel; the dismantling of Sabena, Danone, Marks and Spencer, Cockrill Sambre; the threat of privatization hanging over the postal and transport services—European integration is accountable for all of this. If, tomorrow, we are dragged into military escapades, this will happen in the name of Europe; the victors will be the European multinationals. Today over 60 percent of all legislation is edicted at the European level.
Isn't a United Europe a necessity, given that each European country is too small to compete alone on the global market?
The pursuit of profit and the inevitable competition forces transnational corporations to produce on a larger and larger scale. This leads to constant restructuring, to fusions and concentration, and also to the construction of vast economic zones. The European Union has 15 members and may soon have 25.
This increase in scale allows unprofitable units to be closed and creates opportunities for the transfer of production to low-salary regions—Renault- Vilvoorde's production was moved to Spain and Russia. It also increases the degree of “efficiency” (each unit of production may specialize in one sector and can produce for the entire Union). In order to “regionalize” production, markets must be liberalized and strong regional blocs must be built. The purpose of such blocs is to protect the trade and investments of their own TNCs. The creation of a single currency for a region is a logical consequence of this. Thus, the gradual dollarization of Latin America is a response to the creation of the Eurozone.
In the second half of the 19th and the first half of the 20th centuries the conquest (colonization) of territory was required in order to guarantee access to raw materials, cheap labor and new outlets. As of the end of the 20th century it seems as if the development of integrated markets, under the leadership of a central “fulcrum” fulfils this role; notice that the division of the world into zones of influence by means of economic blocs does not solve the major economic problems: overproduction, stagnation, over speculation. In fact, this process exacerbates conflicts between the great powers with all ensuing military consequences.
Let us return to the question: the creation of the Union is indeed a necessity—within the logic of capitalism, at least. For the reasons explained above, we have to break out of that logic. Apart from the economic and military considerations, larger scale is not a guarantee against social demolition. Take the example of the U.S. This wealthy nation has 45 million poor, 1 out of 4 children go hungry and 1 adult in 5 is illiterate. The average life expectancy in the black community is equal to that of an inhabitant of China, or to that of certain states in India.
But on social policy and welfare matters, Europe does better than the States. Isn't that an argument in favor of the Union?
That we should score better on social matters is due to a long tradition of struggle, to stronger unions, and to the unique circumstances after WWII. At that moment, many concessions were made. This was not necessary in the U.S. where, on the contrary, an anti-communist witch-hunt was organized. But, nothing is forever. In the name of competitiveness and in order to hoist up the profit margins—which have shrunk as a result of the economic crisis—European capital demands the best possible conditions. This will only be possible by applying the anti-social measures long in application in the U.S. Thus, the post-war welfare state has to be dismantled. The lower the wages, the harder the workers toil and the higher the profits. The less capital is taxed (and hence, the less funds available for social security) the higher the gain. This is the iron law of capitalist success.
In the 1980s, the conditions were ripe for a frontal attack on social rights. This happened separately in every country. However, in the 1990s, the attack was carried out under the European banner. The notorious Maastricht quotas served to camouflage the neoliberal offensive under European colors. Compliance with these monetarist requirements has had far-reaching consequences. The conditions were only fulfilled thanks to savings in education, healthcare, and social security. Conforming to the norms led to privatizations; increased indirect taxation (VAT) and higher income tax; job cuts in public services, index freeze, etc. Continued market liberalization led to intensified competition and increased pressure on wages and on working conditions.
Right now, in the EU, there are 27 million unemployed, (all categories included). There are 58 million poor. That is one-sixth of the active population and one-sixth of the total population respectively. In France, the income of the highest earners increased by 17 percent between 1989 and 1994. The lowest incomes increased 3 percent. In Great Britain, the income of the richest 10 percent increased by 60 percent between 1979 and 1995. Meanwhile the poorest 10 percent of the population had their income reduced by 17 percent. In France the soup kitchens served about 31 million free meals in 1992-93. Five years later the number had doubled. Between 1993 and 1996, the number of French citizens receiving minimum income rose by 27 percent. In Germany welfare payments by local authorities trebled between 1987 and 1997. In the Netherlands, the numbers of homeless rose from 25,000 to 45,000 between 1990 and 1998. The number of people receiving minimum income grew by 11 percent.
Clearly, the poor and the unemployed have little to expect from the Union. Every year, the EU devotes barely 3.6 percent of the budget and 0.04 percent of the GNP of the members of the Union to employment and job creation. That amount is more or less equal to the sum that the European Commission allocated to the construction of an international golf course in Malmedy in 1989. After 1994 the poverty reduction programs were halted, as was the publication of figures about poverty levels in the union.
What are the principal political institutions in the EU?
The supreme body of the EU is the European Council, composed of the heads of government and the ministers of Foreign Affairs. Every six months the presidency of this council changes hands. The Council meets four times per year in summits, during which the main axes of political coordination are agreed on, for both home affairs and foreign policy. These principles are transformed into laws by the Council of Ministers known as the Council. The Council is divided into various sub-groups: the Agriculture Council, responsible for the Common Agriculture Policy; the Council of ministers of economics and finance (EcoFin); the Council of ministers of foreign affairs, etc. Decisions are taken either unanimously (there is a power of veto) or the system of qualified majority voting can be used (states have a weight proportional to their size). Decisions are made in secret.
The executive power is in the hands of the European Commission. This body numbers 20 members. The five biggest countries have two commissioners; the smaller countries have one each. These are not elected by the citizens of the Union, but are nominated by the member states. The Commission prepares the material for the European Council and proposes new laws. It develops guidelines for member states and oversees the respect of the treaties. In conflicts between member states, the Commission serves as mediator. Finally, the Commission also represents the Union on the international scene—hence, the negotiations in the WTO are carried out by the Commission, not by individual European states.
There is also the European Parliament. After the distribution of responsibilities as shown above, there is little left over for the Parliament. The Parliament cannot make laws, it can only amend or—in certain cases—hold up legislation. This applies to a limited set of spheres; for example, Parliament is not competent in fiscal or social affairs. It is primarily a consultative body. The ministers and the Commission must listen to the Parliament; they are seldom obliged to take account of its opinions. In theory, Parliament supervises the actions of the Commission. However, the means at its disposal are limited. It cannot choose the members of the Commission, and can only reject the Commission as a whole. Parliament also has budgetary powers: every year it must approve the budget. There are 626 members of Parliament, organized in eight groups. They gather for a 12-week session per year.
Europe is often called the cradle of democracy. Is that reflected in the Union?
The European Parliament is the only legislative assembly in the world in which no laws are written. The Council and the Commission legislate; Parliament may amend their work, but even so, only within very strict limits. Parliament, the only elected institution, has mainly symbolic and cosmetic significance. In practice, the EU is directed by a small number of non-elected technocrats and the most important decisions are made behind closed doors.
This should not surprise us. The present European Union is a project run by capitalist interests, and was never intended to take its inhabitants into account. On the contrary, from the very beginning, every effort was made to keep citizens as remote as possible from the centers of power. Capital directs the decision-making process via powerful lobbies. There are around 10,000 active lobbyists assembled in 500 groups. About 3,000 lobbyists concentrate on the Parliament; that means 5 lobbyists per MP. The lobbyists' task is to tailor the Union to capital's size. They succeed fairly well. Not only do they determine the principal axes of policy and the agenda of the EU; they coach decision-makers thoroughly on minor matters too. Examples are legion: if the ERT (European Round Table of Industrialists) decides that education should be subservient to the principles of competition, then the Commission will adopt that position. If proposals circulate regarding an energy tax to combat the greenhouse effect, then the lobbies will bombard the politicians with all kinds of so-called scientific studies and heavy pressure to prevent such legislation from being enacted.
It is no exaggeration to postulate that the Union is governed de facto by the TNCs—by capital. One of the biggest lobbying groups says that around 80 percent of their suggestions are incorporated by the European governments.
Why do the multinationals have so much power and influence?
There are various reasons for this. To start with, the TNCs have a strong item of blackmail: their capital. For example, the turnover of the 45 businesses of the ERT is bigger than the GNP of the Benelux. Should the politicians not dance to their tune, the TNCs threaten financial and economic reprisals. Secondly, there is a broad consensus within the elite regarding the political and economic route to be followed: all major political parties, the commissioners, the ministers, even the European Trade Union Confederation (ETUC) embrace neoliberal dogmas. In such an ideological force field, it is not hard for the TNCs to push through their agenda. These two reasons, taken together, show that the highest spheres of the EU and those of the business world often cohabit. This is reinforced by the practice of the “revolving door”: business tycoons who become politicians, and vice versa. Think of the socialist Karel Van Miert, former commissioner of competition (now director of Swissair) or Romano Prodi, chair of the Commission (worked at the public holding IRI). In other words, the political and the economic elites are one large club. By this means, the corporations obtain privileged access to the highest seats of power.
In Europe, the most important decisions are made in the Commission, behind closed doors. However, those doors are left ajar for the prestigious leaders of the big lobbies. In addition, those lobbying groups get seats in official advisory bodies and have regular informal contacts with the top politicians. In this manner they can weigh heavily on political work.
Fourthly, the decision-making process in the EU is a very complex affair: apart from the European institutions, national politicians also play a role, this makes the whole very difficult to grasp. Themes are often very technical, some matters fall under the national domain others do not, this means that knowledge of the different legislations is necessary. In order to acquire this and to keep up to date, expertise and resources are required. Other pressure groups, such as the Non-Governmental Organizations (NGOs) have to perform their task with severely limited resources. Finally, there is general lack of interest and of knowledge on the part of the public. This makes it easier for the lobbies in Brussels to wield their influence.
Are we heading for the creation of a true European State, similar to the U.S.?
This is a knotty point of European unification. On the one hand, a supranational state is the logical conclusion to the present-day developments and would fit the strategy of the corporations. Capital will always seek out the form of government, which will best defend its interests. In more concrete terms, in order to defend “our” economic and geostrategic interests worldwide—in opposition to the other great powers, when necessary—a strong, independent common foreign (and military) policy is required. This cannot exist without some kind of supranational state. On the other hand, given the European diversity in language, culture, history and purchasing power, the construction of an extensive homogenous supranational structure, modeled on the U.S., is not feasible in the short term. The nation-state continues to play an essential role in keeping the populace in favor of ensuring maximum profits for capital.
As a consequence, the structure of the developing European state is rather patchy: there is a mixture of national and supranational jurisdictions. There is a lot of resistance to the concept of a supranational state, both from public opinion and from the political elite of the member countries. To counter this, a multi-tier integration is proposed: there would be a core group of countries, which would proceed with rapid integration, and a peripheral group, moving more slowly towards unification. The avant-garde would consist of the France-Germany axis, along with the Benelux. The political institutions would rapidly go through fundamental change.
At the end of April 2001, Federal Chancellor Schröder launched an attention-grabbing proposal for drastic reforms. The Commission would become the European government and the Council would become a sort of Second Chamber, along the lines of the German Federal Council. Simply put, a proposal to create the United States of Europe. It remains to be seen if the public will accept this. The result and the speed at which this political transformation will be carried out will depend on balance of power within the EU.
Isn't a European army necessary as a counterweight to U.S. military domination?
The military expansion of the Union is a reflection of contemporary politico-economic trends. In order for Europe to present itself as a superpower, an independent army is required for several reasons. First, military independence from the U.S. is needed, in order to carry out a common European foreign policy. Such a policy would defend the interests of European multinationals in Europe's backyard: Eastern Europe, Africa, and later in the high priority strategic regions (Central Asia and the Middle East). Second, the Euro will only be accepted by the international currency markets if it is backed by sufficient military strength. This has proven true in the past. Third, a European army is necessary as an outlet for the European arms industry.
The development of an offensive army of intervention will lead to an increased number of military operations in the Third World, or in the countries of the former Soviet-bloc. “Reluctant” countries will be militarily brought to heel. Since the fall of the Berlin Wall, Europe has taken part in military operations in Iraq, Bosnia, Kosovo and Yugoslavia and now in Afghanistan. It never ends. Peace is further away than ever. Furthermore, the division of the world into zones of influence, and the internal strife amongst the great powers is growing. This leads to increasing trade wars, which could eventually result in armed conflict. It is not by chance that the EU wishes to form its own, autonomous army. In the past, the creation of regional power zones has always ended in large-scale military confrontations.
How soon can we expect a European Army?
At the summit of Helsinki (December 1999), a rapid intervention force was brought to the baptismal font. This was a unit of 50-60,000 soldiers. In fact, this is a very small army and there is, as yet, no mention of actions outside of a NATO context. A fully independent European war machine is something North America would not accept, and the Europeans cannot (or dare not) attempt.
Various factors justify why the Union has not (yet) developed its own military arm. Firstly, the leading economy, Germany, is still a dwarf in military terms. Secondly, an integrated army requires a state with a federal structure; this is not yet possible. Thirdly, there is internal opposition, primarily from Great Britain, but also the Scandinavian countries and Austria are hesitant about a militarist identity. Fourthly, Europe lacks the technological and industrial base essential for a fully autonomous military industry, able to carry out long-lasting operations abroad. Finally, the absolute military superiority of the U.S. and the hold it has over the member states through NATO (direct membership and partners).
This is the present-day situation. However, this could change at short notice. Germany has the potential to become a nuclear power very quickly. British industry could change its attitude if European integration continues to progress. Recently, there have been clear signals that Tony Blair wishes to drag Britain over the threshold. As regards the European defense industry, major efforts have been made; in a not-so-distant future the Union will be capable of setting up an intervention force without U.S. assistance. The grip of the U.S. on the present and future members of the Union may wither away and an alliance with Russia is not unthinkable. The main weakness at present is the lack of a supranational institutional structure, but that aspect is undergoing significant change.
What should we make of the expansion of the Union towards Central and Eastern Europe?
With the collapse of the communist regimes, a region with a population of 150 million was “freed.” This was a gift from heaven for the stuttering European economy: new outlets and cheap raw materials and labor. The German TNCs are drooling more than most. After unification, Germany reinforced its dominant and leading position within Europe. The conquest of new markets in the East is not only interesting economically speaking, it is also important from the point of view of geostrategy. According to the German Central Bank, the eastward expansion means that the EU will evolve from its junior position to a truly powerful competitor of the U.S. This will entail a reshuffle on the international political and military chessboard. Ex-Chancellor Kohl even believes that expansion is a matter of war or peace in the 21st century.
There is a second reason for the priority accorded to the integration of the countries of the former Soviet-block. The transition to capitalism has not brought the hoped-for wealth. On the contrary, in 17 of the 18 countries, the economic and social situation is now worse, often far worse than before the fall of the Berlin Wall. Added to the heightened ethnic tension, this creates a powder keg of simmering discontent. To prevent destabilization on the Eastern border and/or a possible return to communism or anti-Western attitudes, the Union wishes to incorporate a belt of countries as quickly as possible. The people of the candidate states are told that EU membership will raise their living standards to those of the richer West-European countries. Given present-day trade fluxes and investment patterns, it is safe to predict that the cleft between these countries and the 15 will only increase. Past experience confirms this: the gulf between Spain, Greece, and Portugal and the rest of Europe has only grown since their accession. The stronger economies like the Czech Republic or Slovenia will be able, perhaps, to thrive, but the vast majority risks receding to the status of “internal colonies.” Due to the very low Mexican wages, U.S. multinationals erect subsidiaries just over their Southern border. Today the same pattern is appearing in German multinationals. Z
Marc Vandepitte is a member of Attac Belgium.