Category: Europe

Europe: an update of the arguments

I promised when I first posted about this in February that I’d update the arguments as we went along, and I’ve been doing that.   This is the latest version.

Good arguments to REMAIN

(and what I see as the counter-arguments)

Good arguments to LEAVE

(and what I see as the counter-arguments)
The EU makes it possible to control things which are beyond the scope of national governments – including the environment, trade, multi-national corporations.

True, but the EU’s track record on international regulation has not been good – often because of obstruction by the British.

 THE EU has a ‘democratic deficit’; it is remote from the people it serves.

More than half-true – but in the UK, the same is true of almost every tier of government, including local government.  Democracy is an argument for more engagement in the decisions that affect us, not for withdrawal from those decisions.
The EU has defined and raised  minimum standards across Europe, e.g. on the environment, transport, water quality.  Without it, standards will fall.

No counter-argument.

 

 In some fields the EU has promoted a ‘race to the bottom’, undermining citizens’ rights.  Examples include the rules on public services and the bar on living wage contracts.

In any federal system there will be decisions that member states might disagree with.  The test is whether the advantages outweigh the disadvantages.
Britain’s diplomatic influence is magnified by the EU. John Major has given a series of examples – including sanctions on nuclear development and the protection of the Kurds – where the UK took the initiative, the UK could not have done in its own right, and where the USA eventually followed suit.

Major’s specific  examples are powerful, but the EU is primarily focused on European affairs, not only foreign policy.

  
Europe is also a social project which makes life better for its citizens, for example through travel, residence abroad (more than 2 million Britons live in other European countries) and social protection.

There has long been a consistent political majority against ‘Social Europe’ and the project has stalled for many years.

 Some shockingly bad decisions by the European Court of Justice (e.g. Rüffert v Niedersachsen, 2008 C‑346/06) have revealed a structural weakness – there is no obvious way to revise and correct defective federal laws without revisions of the treaties.

This could also be seen as an argument for extending the powers of the EU to facilitate the review of federal legislation.
The EU has created rights for its citizens across Europe, such as rights for workers, for women and in consumer protection.   Without it, rights will be eroded.

This is largely true, but the counter-argument is the ‘race to the bottom’: the EU has also undermined significant rights, such as the enforceability of collective wage agreements.

 The free movement of people within the EU has been chaotic.  The principle has been undermined by the combination of enlargement and the abandonment of basic planning and population management to cope with social change.

This is a problem of free markets.  Social and economic development depend on establishing a common framework, not on laissez-faire.
The EU is the UK’s largest trading partner and UK industry and finance will have to comply with its conditions to maintain access.

No counter-argument.  If the UK becomes, like Norway, only a member of the EEA, it will also have to accept free mobility of labour.

 

 The EU’s handling of the Greek crisis reveals a deep malaise –  narrow financial interest,  some bad behaviour on both sides of the argument, bullying of the weaker party and a disregard for the welfare of European citizens.

Without regulation and agreed procedures, the bullying will get worse.  This is an argument for stronger regulation and clearer rules, not for leaving.
Britain’s economy depends heavily on the provision of services to other countries and many of those  services (especially finance) could as effectively be provided elsewhere.  Leaving threatens an economic catastrophe for Britain which the IMF has warned could go beyond that to engulf the world economy.

The counter arguments are weak.  The defence that Britain is too big to be allowed to fail is naive, as is the emphasis on the size of the economy, which is based on book values rather than an analysis of prospects.

Bad arguments to REMAIN

(with counter-arguments)

Bad arguments to LEAVE

(with counter-arguments)
The EU has brought peace to Europe.

True, but it doesn’t follow that the UK’s presence is central to that.

 The EU undermines national sovereignty.

Sovereignty is all about the authority to make laws – rules of recognition, change and adjudication.  The EU safeguards  the rule of law throughout Europe.  
The EU wants to be a superstate.

The EU aims to develop the rule of law at a different level from the nation state.  Many British politicians don’t understand that other governments don’t work the way they do: most have shared competence at different levels of government.  Other federations are not centralised.
The EU promotes liberal markets.

The EU is wedded to a model of ‘structural adjustment’ that has been discredited in other international organisations.  European markets stand in need of regulation and consideration of the consequences of collective actions.

The EU stops the UK from controlling its borders.

The UK cannot expect in a  modern, open, connected society to govern EU or non-EU migration at the frontier.   In most European countries, migration isn’t mainly controlled at the border: it’s controlled through employment, access to housing and services.
 The USA wants Britain to remain as a conduit for furthering US interests.

It’s difficult to see what’s in this for the UK or for Europe.

 Leaving means that the UK will be able to act as it wishes and negotiate arrangements in its own interests.

It won’t, either with Europe or (as Obama has made clear) with America.  Negotiations will be difficult and slow.  The EU nations will favour trade in areas  where trade runs in their favour (e.g. cars) while blocking other imports (such as foodstuffs: the example is the previous French ban on British beef, blocked by the EU).
The UK can make the EU better through positive engagement.

The UK has often  made the EU worse.

 

 The EU has promoted trade rules which exclude or  disadvantage developing countries.

This is a fair criticism of policy, but it is an argument for changing that policy rather than for leaving.
The EU is stopping the government doing what it would otherwise do over issues like human rights and workers’ rights.

There is a confusion here between the EU and the European Court of Human rights: but in so far as this is true, it is an excellent reason to remain.

 

There is something deeply wrong in principle with the idea that a majority can vote to extinguish rights valued by a minority.   This is particularly important for British citizens living in other EU countries.  Many British citizens who are resident in the EU are ‘under-registered’ and those who have lived in the EU for a period over 15 years are being denied a vote.  The process is flawed.

What makes Britain safe?

The referendum campaign means that bizarre arguments are flying thick and fast. I’ve already outlined some of the principal arguments, and as others join them I’m likely to wander off down little alleyways that are well outside my expertise. Here, then, is the first in what will probably be a long series of uninformed digressions. As ever, if people see the hole in the argument, tell me; I’m happy to be better informed.

The first of these digressions concerns defence. We are being told, on one hand, that peace in Europe is based on the European Union; on the other, that this peace depends on Nato. It is always difficult to explain why something doesn’t happen, but in this case we can say that some things have happened instead. Greece and Turkey were both members of NATO in 1952; they were still involved in armed confict in 1974 and came close to further conflict as recently as 1996. Britain’s membership of NATO has embroiled it in several conflicts, including Afghanistan and Libya (not, I should note, Iraq, which wasn’t down to NATO). The effect of nested alliances puts most of Europe in a position perilously similar to 1914: if the Syrian conflict had spilled over the border into Turkey, most of the world would now be at war. NATO – understood not as the organisation itself, but the current terms of the military alliance – has come to look like a major threat to world peace. I have already expressed some scepticism about the view that the EU is what stops us going to war with France or Germany, but the counter-argument that we should leave the EU because NATO has all we need to defend us looks gossamer thin.

Europe: Good and bad arguments

The European referendum is off to a cracking start, but as is often the case, there are some fairly bad arguments out there, on both sides. This is a first attempt to winnow out which are the good arguments – that is, arguments with some justification – from the bad ones.  I’ll try to revise this as the case develops.

Good arguments to REMAIN

(and what I see as the counter-arguments)

Good arguments to LEAVE

(and what I see as the counter-arguments)
The EU makes it possible to control things which are beyond the scope of national governments – including the environment, trade, multi-national corporations.

True, but the EU’s track record on international regulation has not been good – often because of obstruction by the British.

 THE EU has a ‘democratic deficit’; it is remote from the people it serves.

More than half-true – but in the UK, the same is true of almost every tier of government, including local government.  Democracy is an argument for more engagement in the decisions that affect us, not for withdrawal from those decisions.
The EU has defined and raised  minimum standards across Europe, e.g. on the environment, transport, water quality.  Without it, standards will fall.

No counter-argument.

 

 In some fields the EU has promoted a ‘race to the bottom’, undermining citizens’ rights.  Examples include the rules on public services and the bar on living wage contracts.

In any federal system there will be decisions that member states might disagree with.  The test is whether the advantages outweigh the disadvantages.
Europe is also a social project which makes life better for its citizens, for example through travel, residence abroad (more than 2 million Britons live in other European countries) and social protection.

There has long been a consistent political majority against ‘Social Europe’ and the project has stalled for many years.

 Some shockingly bad decisions by the ECJ (e.g. Rüffert v Niedersachsen, 2008 C‑346/06) have revealed a structural weakness – there is no obvious way to revise and correct defective federal laws without revisions of the treaties.

This could also be seen as an argument for extending the powers of the EU to facilitate federal legislation.
The EU has created rights for its citizens across Europe, such as rights for workers, for women and in consumer protection.   Without it, rights will be eroded.

This is largely true, but the counter-argument is the ‘race to the bottom’: the EU has also undermined significant rights, such as the enforceability of collective wage agreements.

 The free movement of people within the EU has been chaotic.  The principle has been undermined by the combination of enlargement and the abandonment of basic planning and population management to cope with social change.

This is a problem of free markets.  Social and economic development depend on establishing a common framework, not on laissez-faire.
The EU is the UK’s largest trading partner and UK industry and finance will have to comply with its conditions to maintain access.

No counter-argument.  If the UK becomes, like Norway, only a member of the EEA, it will also have to accept free mobility of labour.

 

 The EU’s handling of the Greek crisis reveals a deep malaise –  narrow financial interest,  some bad behaviour on both sides of the argument, bullying of the weaker party and a disregard for the welfare of European citizens.

Without regulation and agreed procedures, the bullying will get worse.  This is an argument for stronger regulation and clearer rules, not for leaving.
Britain’s economy depends heavily on the provision of services to other countries and many of those  services (especially finance) could as effectively be provided elsewhere.  Leaving threatens an economic catastrophe for Britain which the IMF has warned could engulf the world economy.

The counter arguments are weak.  The defence that Britain is too big to be allowed to fail is naive, as is the emphasis on the size of the economy, which is based on book values.

Bad arguments to REMAIN

(with counter-arguments)

Bad arguments to LEAVE

(with counter-arguments)
The EU has brought peace to Europe.

True, but it doesn’t follow that the UK’s presence is central to that.

 The EU undermines national sovereignty.

Sovereignty is all about the authority to make laws – rules of recognition, change and adjudication.  The EU safeguards  the rule of law throughout Europe.  
The EU wants to be a superstate.

The EU aims to develop the rule of law at a different level from the nation state.  Many British politicians don’t understand that other governments don’t work the way they do: most have shared competence at different levels of government.  Other federations are not centralised.
The EU promotes liberal markets.

The EU is wedded to a model of ‘structural adjustment’ that has been discredited in other international organisations.  European markets stand in need of regulation and consideration of the consequences of collective actions.

The EU stops the UK from controlling its borders.

The UK cannot expect in a  modern, open, connected society to govern EU or non-EU migration at the frontier.   In most European countries, migration isn’t mainly controlled at the border: it’s controlled through employment, access to housing and services.
 The USA wants Britain to remain as a conduit for furthering US interests.

It’s difficult to see what’s in this for the UK or for Europe.

 Leaving means that the UK will be able to act as it wishes and negotiate arrangements in its own interests.

It won’t.
The UK can make the EU better through positive engagement.

The UK has often  made the EU worse.

 

 The EU has promoted trade rules which exclude or  disadvantage developing countries.

This is a fair criticism of policy, but it is an argument for changing that policy rather than for leaving.
The EU is stopping the government doing what it would otherwise do over issues like human rights and workers’ rights.

There is a confusion here between the EU and the European Court of Human rights: but in so far as this is true, it is an excellent reason to remain.

 

I have previously made my own position clear: I identify myself as a European. A vote to leave would be a vote to deprive me, and anyone else who votes for Europe, of our rights as European citizens.  I will vote to remain.

Some of us still want a Citizens’ Europe

I’ll be voting in favour of the UK remaining in the EU, with a heavy heart.  The vision of Europe being put forward by the UK government is not the Europe I want to see.  One of the recurring tropes of the current campaign is the constant assertion that Europe was only supposed to be a common market.  That was never true, and it was roundly rejected in 1975.  I’ve previously cited the Government’s 1975 pamphlet, Britain’s New Deal in Europe, which was part of the previous referencdum campaign:  here it is again.  The aims of the European Community were

  • to bring together the peoples of Europe
  • to raise living standards and improve working conditions
  • to promote growth and boost world trade
  • to help the poorer regions of Europe and the rest of the world
  • to help maintain peace and freedom.

If the European Union has done far less of this than promised, it is largely due to the dominance of those who want it to be little more than a customs union.

Part of the problem with Europe is the lack of direct accountability, and the lack of legitimacy which might have been conveyed by more direct participation.  Yanis Varoufakis has argued this morning for a strengthened European democracy.  That’s important, but it’s not everything.  Creating more institutions risks creating more veto points, slowing down reform still further.  What we need at European level are rights for citizens – not only negative rights to hold back governments, but social protection, the promotion of higher living standards and safeguards from the consequences of open markets.  In recent years we’ve seen the opposite.

 

The EU opposes the living wage

Scotland on Sunday today reports a dispute between the Scottish government and local authoities.  The Scottish Government has instructed local authorities to ensure that they require contractors to pay a living wage of £8.25 per hour.  The local authorities have responded that they are not legally permitted to do so, and point to guidance from the Scottish Government that tells them they can’t (it’s in paragraph 18).  To my horror, I have to say that the local authorities are right.

The problem goes back to the European Court of Justice, which has taken the view that any attempt to impose minimum conditions constitutes a restraint of trade and interferes with the freedoms of the contractor.  In Rüffert v Niedersachsen, 2008 C‑346/06, they judged that national governments could not use contracts to  enforce collective wage agreements.  (The Advocate General had suggested that this should be subject to protecting the rights of workers – the Court disregarded that part of his legal advice.)  Bundesdruckerei v Stadt Dortmund 2014 C549/13 states that the minimum wage of one country cannot be exported to another country by default.  The Scottish Government Guidance refers to the second case, possibly because the reasoning in it seems to support the general argument, but Rüffert is more generally framed, and so more important.

Taken literally, both cases refer explicitly to firms providing services from another member state.  That seems to imply that (a) personal services, which in their nature have to be delivered person to person in a specific place, might call for different criteria and (b) the rules may not apply in the same way to firms based in the member state issuing the contract.  Neither prospect, however, offers  much direct consolation.  The fact is that the ECJ, like the US Supreme Court notoriously did in Lochner v New York,  has taken a stand in favour of the rights of commercial providers and against the rights of workers and governments.  This is bad for the economy, bad for the law and bad for Europe.

Discriminating against EU migrants

David Cameron has been arguing for an immediate suspension of the availability of in-work benefits for European migrants.  If the press reports are to be believed:

  • Cameron wants to suspend in-work benefits to European migrants until they have been in Britain for four years
  • the European Commission has proposed the possibility of an ’emergency brake’ for countries under pressure
  • the ’emergency brake’ would depend on agreement of all EU members, and could only be applied once.

Very little about this makes any immediate sense.  Britain’s benefit system is not under extraordinary pressure either in general, or from migrants in particular.  The main source of pressure is government policy.  Discrimination against EU migrants invites equivalent discrimination against Britons living abroad (and some of the countries they go to really are under pressure).  A four-year ban is timed to make this an issue in the next General Election.  It is very debatable whether the specifics of any deal will swing any votes in the forthcoming EU referendum, one way or another.

However, one issue  lurking under this does matter.  It’s been recognised for years in social policy that there is no difference in principle between tax reliefs – “fiscal welfare” – and  benefits.  Child Benefit was created, specifically and explicitly,to combine the family allowance and the Child Tax Allowance, because there was no real difference between them.  The EU has begun from the ‘fundamental’ principle that when workers move, they should not be subject to barriers.  Despite that, the Commission, the Council and now the Court of Justice have been prepared to accept discrimination in the area of some benefits (such as the residence requirements for non-contributory benefits for people with disabilities), while expressing reservations about discrimination in others.  That position is not sustainable and needs to be addressed.

 

 

 

 

 

The future of welfare states

I was in Berlin this week for “Vision Europe Summit”, a conference on the future of the welfare state, organised by Bertelsmann Stiftung and Chatham House.  The main paper is here.  I found more to disagree with than to agree: I take a different view of the problems, the aims, the instruments and the prescriptions.  The paper suggests, for example, that there are three main objectives of welfare states:  redistribution, social protection (reduced to “piggy banks”) and social investment.  But there are far more aims than that – among them the relief of poverty, economic management and support for economic production,  behaviour change, social welfare, social control and humanitarian aid.  Similarly, there is no intrinsic reason to suppose that welfare is unsustainably expensive.  Countries often choose to consume more  as they get richer – which is understandable – but transfer payments are largely neutral in economic terms and the real question is whether payment for benefits and services is made by governments or independently.

I wasn’t presenting my own work, but I was asked at the last minute to step in to a panel as a respondent for a survey of public opinions about welfare.  The same problems apply here: people don’t share a common view of what the terms mean and it’s difficult from their responses to work out what they mean when they say, for example, that they’re not sure their pensions will be paid.  Because there’s no uniform model of the welfare state, generalisations about what people are saying don’t offer a clear guide.

European migrants no longer have the same rights as other workers in the EU.

The European Court of Justice decided on 15th September that member states can impose greater limits on the rights to benefit of EU migrants in other countries.  EUobserver explains that if a person works for less than a year, then benefits can be suspended after six months, and the claimants can be deported.  The detailed judgment is here.

I wrote, earlier this year, that “The UK can legitimately deny benefits to EU workers if, and only if, it denies benefits to British workers on the same basis.”  It seems I was wrong.   Britain, and other European states, can now come to the decision that a  European worker might not be enough of a worker to be treated as one, and European migrants who work do not have the same rights as other workers.  That drives a cart and horses through the principle of free movement of labour on equal terms.

We should let more migrants in

bildThe ‘crisis’ at Calais may be small beer by comparison with the issues in Hungary, Greece and Italy, but clearly it has implications for both the British and the French government.  My sympathies, I should declare,  are with the migrants.  I come from a long line of refugees – my father left France in 1940; I am the first male member of my family not to have to leave his country in five generations.  Some of the arguments that are being made about the ‘swarm’ of migrants are preposterous.  They should not be trying to enter the country illegally.  What options do they have to enter legally?  They should apply in their own countries through the proper channels.   So …  what do the proper channels in Syria look like?   They come with no identity papers.  A standard part of fleeing the country is that you dump papers so that you won’t be sent back to die.   The Guardian cites the UN special representative on migration:  “Many of those in Calais are refugees, just as the Jewish people were in 1939.”

The people at Calais have come from very different places – some from war zones, some from chaotic regimes, others from very poor parts of the world.   Some of them have a strong case for asylum; others may not; but the authorities in Britain and France don’t seem to be doing anything to differentiate them. The first duties fall on France, which is behaving disgracefully.  Where people are stateless, France has a legal duty to receive them.  When they are seeking asylum, France has a duty to process the application and admit them if the claim is justified.   Where there are unaccompanied children, France should be intervening to provide care.  Where a person has no case to remain, there is no justification for leaving that person to settle in a makeshift camp in Calais.   The second set of duties fall on Britain.  Britain has not yet accepted a proportionate share of people seeking refuge in the EU.  It is using border controls to make up for the inadequacy of its domestic arrangements:  people could not live and work illegally in the UK  if we applied the same rules about residence, housing occupancy and employment that are applied in most of the EU.  And, of course, once someone gains the status of a French citizen, they are legally entitled to seek work in Britain.  We might as well take them now.

4th September, 2015:  I have added a clip from the German newspaper, Bild, published on 31st August.  It refers to ‘the shirkers of Europe’ and the strapline is, ‘they help far fewer refugees than they could’.   

Scotland’s alternative to PFI is challenged by the EU rules

The Scottish alternative to PFI, Non Profit Distributing or NPD, seems to have fallen foul of EU rules.  Today’s Guardian reports that the intervention of the Office for National Statistics will force the Scottish Government to reclassify a large number of publicly funded schemes as being in the private sector, and consequently require the Scottish Government to refinance the schemes using private money.

The rules are complex, and  I don’t claim any specialist knowledge in this field, but this is not about the way official statistics are kept: it’s a matter of substance.  There are two main classes of rules which might apply,  The first set of restrictions relates to public procurement: state intervention is not supposed to affect the level playing field between competing firms.  This is impossible to realise, because of course any public procurement will do that, and PFI in England might reasonably be considered to have favoured a specific class of large firm with specific UK experience.   Hellowell and Pollock have expressed scepticism that the NPD model is much better.  The second set of rules, which is more pertinent in the current situation, relates to the ability of public organisations to run a deficit.  The EU has a process, the Excessive Deficit Procedure,  to curb the level of the public deficit.  This is enforced within the Eurozone by Stability Programmes, and outwith the Eurozone by Convergence Programmes.  The UK is subject to a Convergence Programme, backed by sanctions, which commits it to reducing its deficit to 3% of GDP.  It happens that the programme demanded by the EU seems to coincide fairly closely with the aspirations of the current Conservative government, which might explain why the UK hasn’t been complaining vociferously about the restrictions.

There are grounds to challenge whether these rules are appropriate.  In macro-economic terms, the distinction that’s being made between public and private debt is pretty much meaningless, and shifting public debt off-book to the private sector does nothing to reduce the impact of debt in reality.   In terms of maintaining a competitive market, the idea that public procurement doesn’t affect the balance of activity between firms is absurd, and unattainable.   The very existence of a procurement programme changes the game.  The size of the commissions, the permissions to undertake economic activity, and any transfer of financial benefits from public to private (or vice versa) affect the fortunes of specific enterprises and market sectors.   If the government is serious about renegotiating how Europe works, public procurement might be a good place to start.