European Affairs

Summer/Fall 2003

 

European Integration
The EU May Have Missed a Chance to Become More Democratic
By Erik Berglof

 

The European constitutional convention that concluded its work in June has gone farther than many had expected in reforming the European Union's institutions to prepare for the entry of ten new members next year. Despite its hesitant preamble and many compromises, the draft constitution that is now being studied by the Union's member governments is a bold document.

The convention, however, may have missed an important opportunity to strengthen significantly the direct democratic accountability of the EU institutions. The influence of the electorate is only marginally strengthened through the enhanced powers proposed for the European Parliament.

Many of the proposals in the draft, not to speak of the plethora of amendments put forth, are also mutually inconsistent, creating potential conflicts among EU institutions. These inherent conflicts reflect the lack of overall vision for the long-term evolution of the European Union as a political entity.

Fortunately, some progress was made at the convention. As the draft is being attacked from all sides, it is important to remember that consensus was achieved on many things that seemed impossible just a couple of years ago. The mere notion of a European constitution was vehemently opposed by many groups in Europe, and even by some countries.

The proposed new treaty reduces the number of decisions taken by unanimity and radically raises the probability of action being agreed in the Council of Ministers. It strengthens the European Parliament by extending the so-called co-decision procedure (which provides for joint decision-making with the Council of Ministers) and by granting the Parliament more influence in the choice of the Commission President.

The Parliament, the only directly elected European institution, will also have a greater say over the expenditure side of the EU budget. The size of the Commission will be reduced and the Commission President will have more power over the appointment and dismissal of Commissioners, hopefully ensuring increased effectiveness.

The problem is that short-term compromises may have been reached at the expense of desirable long-term results. In Built to Last: A Political Framework for Europe, five European and U.S. economists analyze the fundamental choices facing the Union, drawing on tools from economics and political science. Now that the convention has done its work, it will be up to the member states, meeting in an intergovernmental conference due to start in October 2003, to consider the details of the draft treaty and how it affects such long-term options.

Before discussing these choices, it is useful to state what they are not about. First of all, in contrast to much of the popular debate, the fundamental choice is not between an overall move to greater centralization and general decentralization. Europe needs - and, judging from surveys, its citizens want - a little of both, depending on the policy area.

When effects spill over national borders and when economies of scale are large, the logic goes in favor of more centralization. When tastes are very diverse and when local requirements are substantial, decentralization is more attractive. Many policy areas, such as agriculture, in which the EU institutions are heavily involved today, should be "nationalized." Other areas such as enforcement of the single market and competition policy, and also the fight against terrorism, call for greater coordination and more effectiveness.

Secondly, the institutional choice is not between the community method and the intergovernmental method of decision-making. The community method is defined by the institutions of the Union, by the interplay between the Commission, the Council and the Parliament. Institutional reform is synonymous with reform of the community method. It was the realization that the intergovernmental model would not be able to generate the necessary reform that provoked the convention.

Thirdly, the driving force of institutional reform at the moment is not "flexible integration," the idea that subgroups of countries can go ahead on their own, leaving the others to catch up later. Neither does the push come from the idea of "Europe à la carte," where individual members choose from a menu of options. Particularly in view of its forthcoming enlargement, the European Union needs an inclusive architecture, not an architecture that builds new walls between insiders and outsiders.

The real choices facing the Union are about how to decide the appropriate allocation of tasks and adapt the institutions accordingly. Broad new tasks should not be transferred to institutions severely lacking in democratic accountability. The current EU institutions were originally created to forge deeper ties between previous enemies in two devastating wars. And in this regard they have been remarkably successful.

Nevertheless, the goal of creating an "ever closer union," as originally stated in the 1957 Treaty of Rome, can no longer be the overriding objective of the European Union. The somewhat anemic formulation "united in an ever closer fashion," in the preamble personally drafted by Valéry Giscard d'Estaing, the President of the Convention, goes some way in this direction. But the current built-in integration bias should be eliminated, and the accountability of the Commission strengthened more than envisioned by the convention's proposal. The Commission, a supposedly apolitical elite bureaucracy that is meant to serve as the guardian of the EU treaties, is still entrusted with a monopoly of making proposals to the Council of Ministers.

The logic for further reform is simple. If the Commission is to play a more important role in sensitive issues of justice and home affairs, and in security and defense policy, democratic accountability is key. With greater democratic accountability follows more politicization, and with more politicization the Commission would have to give up its monopoly on proposals and share the right to take legislative initiatives in the Council with the European Parliament.

Reforms in one EU institution have ramifications for the other institutions, and ultimately for the relationship between the EU institutions and member states. When the proposed constitutional treaty lowers the bar for passing decisions in the Council of Ministers, it enhances the agenda-setting powers of the Commission, allowing the latter to choose from a larger set of winning coalitions in drafting its proposals. Ultimately, lower hurdles for passage in the Council shift influence away from member states, reinforcing the need for greater democratic accountability of EU institutions.

A more accountable, and thus more legitimate and stronger, Commission would have to be counterbalanced by a strengthening of the Council. The Council should be given the right to nominate non-elected members of the Commission and the right to switch on and off key functions of the Commission, much as it does today with trade and to some extent in foreign affairs. When the offices of High Representative for foreign and security affairs, currently Javier Solana, and External Affairs Commissioner, currently Chris Patten, are merged under a single new EU "Foreign Minister," according to the Convention's proposal, the functioning of this switch-on-switch-off accountability becomes even more crucial.

The enhanced powers proposed for the European Parliament can be further strengthened with the right to propose legislation. In the end the Parliament should be no less and no more politicized than the Commission and thus have the same rights. The range of issues decided through the procedure of co-decision between the Parliament and the Council could also be further extended beyond what has been proposed by the convention.

Even if the integration bias is weakened, Europe may need, alongside the Commission's role as guardian of the treaties, a more effective "Guardian of Subsidiarity." (Subsidiarity is the principle that all decisions should be taken at the lowest possible institutional level, whether local, regional or national, and that only those requiring EU-wide action should be taken in the EU institutions.)

One possibility would be that, before legislation is introduced, the Commission be required to inform national parliaments, the Council and the European Parliament of its intentions. Such pre-legislative reviews could result in warnings of violations of subsidiarity. After legislation had been passed, the European Court of Justice would be the appropriate "Guardian of Subsidiarity."

The European Union must also decide about its long-term choice between a parliamentary model and a presidential model. By giving the European Parliament a role in the appointment of the Commission, the convention clearly opted for a parliamentary model, the model familiar to most Europeans. But parliamentary systems tend to lead to weak and unstable coalitions, in particular when heterogeneity is high. Given that the head of government is usually indirectly elected, the direct accountability of the executive branch is also weaker.

Most large, heterogeneous countries (with the conspicuous exception of India) have adopted presidential models. Presidential systems provide for more direct democratic accountability and executive effectiveness, but score less well on representation and efficiency since they encourage pork-barrel politics and reduce incentives to provide public goods.

While many European leaders such as Tony Blair and Jacques Chirac are household names to most Europeans, it may still be too early for Europe-wide presidential elections. But the Presidency of the Council must nevertheless be made more democratically accountable. Rather than locking into a parliamentary model, an electoral college could be created to choose the Council President, rather than leaving the decision to EU leaders as proposed in the draft constitution. Delegates to an electoral college could be selected by national parliaments and/or by popular vote. Each country could, within certain limits, decide on its own electoral process, and change over time as many U.S. states have done.

Most importantly, whether under a presidential or parliamentary model, it should be up to the citizens of Europe to decide what they want in terms of integration. A candidate or a team of candidates could run on a platform calling for less power for the central EU institutions in some areas and more power in others. Following the same logic, the current irreversibility in the acquis communautaire (the entire corpus of EU laws and regulations), should also be abolished. In a modern democratic state, it does not make sense to lock in future generations.

A constitution should be designed to last. It should, as the proposed draft mostly is, be long on general principles that do not vary over time, such as democracy and the basic rights of citizens and member states, and short on details. The early discussions of long lists of shared competencies, detailed voting procedures or the size of the Commission are bound to become obsolete and have no place in an enduring document.

Whether the draft treaty will survive in its current shape is another issue. The document will now be hostage to the intergovernmental decision-making it was meant to reform. Things may well unravel. Losers from the reallocation of votes in the Council, such as Spain and Poland, will fight that part of the treaty. Other countries, like the United Kingdom, will probably resist some of the emphasis on social values. Christian groups resent the exclusion of references to the Christian religion, and special interests will resist other language.

We should not hope for major new reforms in the final text from this process. In the most optimistic scenario, the outcome will not be radically different from the draft agreed on by the convention. While the reforms will not go far enough, and we can decry lost opportunities, Europe will not be the same after the new constitution has been adopted.

Erik Berglof is Director of the Stockholm Institute of Transition Economics (SITE) at the Stockholm School of Economics and co-author of Built to Last - A Political Architecture for Europe, published by the Centre for Economic Policy Research in London. The other authors are Barry Eichengreen, Gerard Roland, Guido Tabellini, and Charles Wyplosz.