With all the focus on Brexit turmoil, it’s easy to miss recent changes in the EU. Unfortunate, because they are important.
The appointment of former German defence minister, Ursula von der Leyen, as president of the European Commission was rightly seen as a signal of Germany’s predominance in Europe but her political programme is even more significant.
This can be found in the aptly-titled manifesto “A Union that strives for more“. And it surely does – in enough detail for liberal nightmares.
Leaving aside stirring rhetoric on Europe’s need to “Einheit und innere Stärke wiederfinden” (regain unity and inner strength), there is an ambitious plan for European integration under six headings:
- a European Green Deal (meaning a faster and more costly move to climate neutrality and zero pollution, coupled with more barriers to other countries’ ‘dirty’ products);
- an economy that works for people (more business regulation and managed competition, a European minimum wage, more direction on education and welfare from Brussels, and more co-ordinated monetary and fiscal policy);
- a Europe fit for the digital age (state investment, pre-regulation of new technology and innovation (AI for example) and the world’s most expensive data regime – all this might be very expensive);
- protecting our European way of life (gathering more national powers to the EU, such as border protection and asylum, and trammeling the powers of national governments where these conflict with the EU order – read Poland and Hungary);
- a stronger Europe in the world (defence policy reduced to ritual backing of NATO and a commitment to “uphold and update the rules- based global order”);
- a new push for European democracy (more power to the European Parliament and removing the ability of national states to set their own climate, energy, social and taxation policies).
But are Von der Leyen’s policies durable and what do they say as to the future of Europe?
On the economic plane, what is most striking, after stripping away the boilerplate rhetoric of globalism and openness, is just how inward looking is the approach. Europe needs to be protected from uncontrolled innovation and from other countries’ dangerous goods, standards and perhaps ideas. At the same time, it can tolerate less diversity at the national level.
It’s arguable that this is consistent with stability. Like the US, the European trading bloc has relatively low levels of external trade (imports and exports are each 11% of GDP, while imports from China, exports to the US, and exports to / imports from the UK, are individually about 2% of GDP). So while the disruption of Brexit pushes Britain towards a policy of openness, the EU has the luxury – at least in the short term – of putting up more barriers.
If there is an Achilles’ heel, it will be the implications for economic growth. Europe is already one of world’s slowest-growing economies (less than 1% p.a. for the Euro area over the last twenty years according to Trading Economics). Not much in Von der Leyen’s policy to change that.
Politically, the principal feature of the EU’s governance is its successful centralisation of power over most aspects of economic life (excluding welfare and taxation) and a good slice of social life. The EU legislature (the European Parliament) and executive (the European Commission) work most comfortably with the German and French political classes, and in general their influence predominates. Smaller countries’ acquiescence is purchased with subsidies, integration in a huge market, and in some cases, like the post-Communist states, by grafting on to them the EU’s political stability.
But the price has been suppression of national choice. So far, this has not been a problem – at least for those who sympathise with the EU direction of travel. But Brexit showed that the right combination of circumstances can lead to a break. Britain’s pending departure from the EU perhaps increases the likelihood of progress down the Von der Leyen path. But it also suggests that going down that path increases the likelihood that Europe will test the limits to integration and centralisation.
Bob Edlin is a veteran journalist and editor for the Point of Order blog HERE.