Search for

No matches. Check your spelling and try again, or try altering your search terms for better results.

assessments

Mar 25, 2017 | 13:15 GMT

9 mins read

Where the Cracks in Europe's Foundations Began

The cracks in the EU were there even when the 1957 Treaty of Rome was signed.
(KEYSTONE/Getty Images)

The European experiment that brought a war-weary Continent together was set in motion 60 years ago in Rome. On March 25, 1957, France, West Germany, Italy, Belgium, Luxembourg and the Netherlands signed the Treaty of Rome to form the European Economic Community, the center around which the European Union eventually coalesced. In the decades that followed, the six-nation club in Western Europe evolved into a continentwide organization that affects the lives of more than 500 million people and encompasses 28 (soon to be 27) countries. But while the Treaty of Rome led to the creation of the largest trade bloc in the world, it also established an institutional model that is showing clear signs of fatigue.

The Treaty of Rome and the pacts that preceded it in the early 1950s were developed with the same intent: to answer the "German question," that is, to address the issue of Germany’s role in Europe. Before the European Economic Community was born, three projects that focused on military and security issues in Europe were proposed. All were proffered by France, the main target of 75 years of German military aggression that ended with World War II.

In 1950, the French government promoted the idea of the European Defense Community, with the goal of building a pan-European military. France, West Germany, Italy, Belgium, the Netherlands and Luxembourg signed the treaty establishing the group in 1952, but after the French Parliament failed to ratify it, the project was abandoned in 1954. The same group of countries formed the European Coal and Steel Community in 1951, which France hoped to use to restrict German steel production and gain some degree of control over the coal supplies Germany needed to fuel its economy. Six years later, they also founded the European Atomic Energy Community to increase nuclear cooperation. (The Euratom Treaty was signed alongside the European Economic Community agreement, leading some EU historians to label them the "Treaties of Rome.")

Development of the European Union

The lessons learned from those projects, and the structures they created, paved the way for the birth of the European Economic Community. But the introduction of a European single market, in which goods, people, capital and services eventually would move freely, was not the only proposal under consideration at the time. The British government championed the development of a free trade agreement among Western European countries, a much more modest endeavor. But the European Economic Community had a distinct political ambition that was not present in the British proposal, which would lead to the creation of the European Free Trade Association. The most notable difference between the two was the development of a European Commission under the European Economic Community that would operate above national governments and oversee the functioning of the community.

The Underpinnings of European Integration

At the core of the European projects of the 1950s was the concept of functionalism, or the idea that national governments should progressively transfer prerogatives over different policy areas to supranational structures managed by technocrats. This ideology has had a lingering influence on the European project. The assumption that supranational managers are more efficient than national governments has raised questions about the democratic legitimacy of the European structures that the bloc is still trying to answer. Over time, European leaders sought to strengthen the role and powers of the European Parliament, the only international organization whose members are elected by direct suffrage, in an attempt to buttress the legitimacy of the European Union. But the accusation that the bloc is governed by unelected technocrats in Brussels remains a strong argument of many Euroskeptic political parties.

The underpinnings of the Treaty of Rome also had a teleological aspect, since its authors foresaw the bloc as inexorably moving toward greater integration. The treaty does not spell out an ultimate objective of creating the "United States of Europe," but it does speak of an “ever closer union” among its members. Scholars and politicians still debate whether the treaty's initial parties had a federal system in mind for Europe. But the belief that the European project is destined to move in that direction has remained mainstream political dogma for most of the past six decades.

European institutions, moreover, were designed to be independent from national governments, at least on paper. The Continental bodies saw this principle as a justification to expand their own power over areas that the treaties don't necessarily clarify. The European Court of Justice played a significant role in this process. Its rulings increased both its own authority and that of the European Commission, creating new political and legal realities that in many cases national governments ratified only after the fact.

Member states often accepted these changes, albeit reluctantly. For example, France temporarily withdrew its representatives from the European Commission in 1965 to protest the commission's plan to set up its own financial resources, thus reducing its dependence on contributions from member states. The European Court of Justice and national constitutional courts, in turn, waged long legal battles over whether European legislation or national legislation takes precedent.

In many ways, EU history can be seen as a constant attempt to find a balance between sovereign states and the institutions meant to transcend them.

The tug-of-war between national and supranational authorities led to the introduction of the European Council in the 1970s. What was originally intended as an informal forum to allow the West German chancellor and French president to discuss Continental issues evolved into a formal institution that includes the leaders of each of the bloc’s member states. While the European Commission is in charge of the bloc's day-to-day administration, difficult political decisions are left to the council. In many ways, EU history can be seen as a constant attempt to find a balance between sovereign states and the institutions meant to transcend them.

The Legacy of the Treaty of Rome

The political process that began with the Treaty of Rome led to what is probably the most dramatic overhaul of the European bloc to date. The Treaty of Maastricht, signed in 1992, is the ideological heir of the Treaty of Rome that expands on the idea of a unified Europe. Like the Treaty of Rome before it, the pact sought to address the issue of Germany’s role on the Continent, spurred by the country’s reunification in 1990. Many of the clauses in the Treaty of Maastricht aimed to finally dissolve the nation-state in favor of supranational structures, but its most radical novelty was the introduction of the euro.

Economists around the world warned of the risks of introducing a common currency in an area where the factors needed to make it work (such as labor mobility or mechanisms to ensure fiscal transfers among highly heterogeneous countries) were not all present. But the decision to move ahead with the euro was purely political. There was a belief among EU governments and institutions that progressive European integration would solve the eurozone’s shortcomings — an ideological certainty that can be traced back directly to the Treaty of Rome.

More important, German reunification made France all the more eager to ensure that Paris and Berlin would be bound so closely together by political and economic structures that another war between them would be nearly impossible. After significant political horse-trading, Germany agreed to abandon the deutsche mark, but only after ensuring that the European Central Bank would be modeled after the Bundesbank, sharing the overarching goal of keeping inflation low, even at the expense of economic growth.

And so the European Union linked its future to that of the monetary union. The project worked well for almost a decade — perhaps too well. It lulled governments and markets into the sense that debts of all euro members carried similar levels of risk (and therefore, commanded similar interest rates). But despite sharing the common currency, an economy like Greece's isn't comparable to one like Germany's. When the eurozone debt crisis finally exploded, Northern European countries refused to become the lenders of last resort to their neighbors in the south. Bailouts were eventually provided, but they took the form of loans that had to be repaid, and the austerity measures that came with them turned recessions into depressions.

A Crisis of Credibility

The financial crisis damaged the credibility of the European project. Opinion polls show that a majority of Europeans still want their countries to remain in the eurozone, though the strength of support varies widely, from around 80 percent in places like Luxembourg to roughly 50 percent in Italy. In many cases, support for the common currency is less a product of conferring a broader European identity than a fear of the potential consequences of leaving the currency area. As EU members outside the eurozone (such as the United Kingdom, Poland or Romania) enjoyed quicker and stronger recoveries than their eurozone peers, Europhiles had a harder time defending the euro on grounds other than its political meaning.

This presents a fundamental issue: For most Europeans, political loyalties end at the national level. Moreover, the European crisis has rekindled nationalist sentiments from embers that six decades of Continental integration failed to extinguish. Many of the 500 million people subject to the European Union's direct influence still see the bloc as a foreign and distant power, and Brussels’ complex bureaucracy and often opaque mechanisms do little to inspire their trust.

The Treaty of Rome marked the start of a political process that over the next 60 years contributed to the pacification of the Continent, the liberalization of economies, the democratization of Southern and Eastern Europe, and the erosion of barriers among societies and countries. For all its shortcomings, many countries outside the European Union aspire to join it. But at the same time, the treaty created a foundational myth and an ideological structure that have often led to imperfect political, economic and institutional outcomes. Anti-EU forces still aren't strong enough to take control of national governments, but the underlying factors that led to their emergence will continue to threaten the continuity of the bloc. Even without Euroskepticism, high debt levels in some member states, weak banking sectors in others and irreconcilable differences between north and south will keep causing problems.

Since the United Kingdom voted to leave the European Union in June 2016, EU leaders seem to be coming to terms with the fact that earlier one-size-fits-all approaches to the process of Continental integration failed to take into account the geography that has made Europe a naturally fragmented place, where attempts at federalization are extremely difficult — if not impossible — to implement. Recent proposals to resurrect old ideas of a multispeed Europe, which would not require all member states to converge, are an unusual show of pragmatism among European elites. Sixty years after the Treaty of Rome, the European Union remains proud of its past, but it is also still uncertain about its future.

Stratfor
YOU'RE READING
Where the Cracks in Europe's Foundations Began
CONNECTED CONTENT
3 Geo |  4 Topics |  1 Themes 
SHARE & SAVE

Copyright © Stratfor Enterprises, LLC. All rights reserved.

Stratfor Worldview

OUR COMMITMENT

To empower members to confidently understand and navigate a continuously changing and complex global environment.

GET THE MOBILE APPApp Store
Google Play