Europe’s crises demand hard talk in Bratislava

14/9/2016

Member states need to rethink the union’s founding principles

The heads of government of the EU member states meeting this week in Bratislava could be forgiven for being in a state of shock. It is the first gathering since the UK, one of the largest and most dynamic of their number, voted to leave the union.

It would be tempting to write off the Brexit vote as a manifestation of that country’s instinctive Euroscepticism, a nation that joined the EU late and has grumbled about it ever since. That would be a serious mistake. As Donald Tusk, president of the European Council, said in a letter to member states this week, the fears of the British electorate find echoes across the EU. Voters are increasingly sceptical that their political elites share their concerns and can address them.

To do so will require more than a few technocratic fixes. It needs a fundamental reassessment of the entire basis of the union, including the founding principles of the free movement of people, goods, services and capital, a process that will go well beyond the summit. To do otherwise is to ignore that the EU, beset by a refugee exigency and a single currency that is manifestly not working, is in a near-existential crisis.

The controversies about immigration, which dominated the Brexit campaign, and the weak and uncoordinated response to the refugee crisis, have made the cross-border flow of people one of the highest priorities for reform. The complete free movement of people, as opposed to labour, made sense when the Treaty of Rome was signed in 1957. But there was then no equivalent of central and eastern European countries whose low-cost labour citizens had an automatic right to work throughout the bloc. That principle should be re-examined, perhaps with an emergency brake on migration for countries that have absorbed a large number of immigrants quickly.

In most areas, the default instinct should be a move towards intergovernmental decision-making rather than a federalist centralisation of power. This will require national governments to co-ordinate with each other and take responsibility for their actions, rather than simply blaming Brussels when problems arise. The refugee crisis, for example, needed countries to work together to secure the EU’s external border and manage internal flows of migrants. This they wholly failed to do.

By contrast the eurozone, which has lurched from crisis to crisis in the past six years, needs some powers to be unified rather than dispersed. The single currency zone requires a degree of fiscal burden-sharing, while stopping short of a centralised budget system, and most importantly to push ahead with a banking union that is currently completely blocked.

This centralisation, though, should not allow the eurozone to mutate into an inner core or dominant caucus that dictates policies to the rest of the EU. The departure of the UK, by far the largest of the non-euro EU members, will inevitably make eurozone dominance easier. It should be resisted. Integration inside the single currency area is necessary; dividing EU member states into first and second-class passengers would be a mistake.

The Bratislava meeting will not settle these questions. Indeed, it can only begin to start a conversation about them. Though national governments need to take more of the responsibility for making decisions, implementing them and owning the consequences, the future of the EU is not a simple question of devolving rather than federalising powers.

The first task is to admit that the EU is in a deep and abiding crisis, and that a fundamental review of its founding principles will be required.

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