Summary of Economist article: "The Europe that died"

This is a paragraph by paragraph rewrite and summary of a June 3rd 2005 Economist cover page OP-ED and does not express my opinion on the subject matter therein. The intent is simply to make a legal version of premium content available to public eyes without breaking copyright law. The original article may be found here at: The Europe that died.

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Those who sought a United States of Europe met with shock at the double "no" votes of both France and the Netherlands to the EU constitution. While legally just a treaty, it would have consolidated all other UN treaties into a single text and added new powers for Brussels - many opposed that aspect of this treaty. Though hopes were dashed, it was always unlikely, due to the strict requirement of approval from all 25 EU member states.

Voters in two founding EU sates have decisively voted down the EU constitution. Some suggest that this outcome may have been due to protest votes against their respective government policies, poor economies, and outsourcing. However, anyone who watched the French and Dutch television debates would realize that voters' presented their ballots with more than local issues at mind. The grassroots rejected this ballot.

Jacques Chirac, President of France, responded by replacing his prime minister with yet another elite power broker, Dominique de Villepin. This bodes poorly for those who hope that the power structure will take this outcome as a lesson. The EU power elite continue on, trying to ratify the constitution elsewhere throughout Europe in the vain hope that with more signatories on-board, France and The Netherlands will reconsider.

ORIGINAL TEXT: The French president, Jacques Chirac, has responded in time-honoured fashion by picking a new prime minister, Dominique de Villepin, as classic a specimen of the elite as it is possible to find (see article). That augurs ill for the conclusions that Europe's leaders will take from the voters' anti-elite message. Too many are still insisting on proceeding with ratification of the constitution elsewhere. Yet the decisive French and Dutch noes have killed the constitution stone dead: there is surely no prospect of these two countries being asked to vote again, as Denmark and Ireland did on previous occasions (see article). To insist that the Danes, Irish, Poles, British and others must still vote is like asking doctors to operate on a corpse in the vain hope of resurrecting it.

Just as wrong is for EU leaders to break up bits of the constitution and attempt to vote each article in piecemeal. One could argue that EU needs a coherent foreign policy, consistent voting system for the Council of Ministers, and a smaller European Commission with more democratic and transparent law-making. But most of this could need not require treaty amendments with its onerous public ratification demands. Unfortunately, now that voters have expressed their wishes to bluntly, to attempt to circumvent ratification would engender a huge public backlash.

Such bargaining behind closed doors is a waste of time. Instead, leaders should draw two conclusions from the popular sentiment expressed by these votes. The first, is that integration of Europe through a unified constitution into a federal superpower is now dead. A more decentralized confederation is a better option now.

The second lesson is to further decentralization of power back to member states in order to enact the EU's supposed "Subsidiarity" principle into force. While this would balkanize the EU's market reform movement into some economic liberal and some socialist states throughout the EU, this is what the diversity of national views appears to demand. Let Britain keep its labour markets free, while France prefers a more socialist agenda. Neither should impose its views on the other.

Second Section: "An exercise in damage limitation"

Which is not to imply total economic freedom for member states. The Rome treaty in support of free trade for goods, services, and capital into a single market is still a European common goal. For this to work requires unified market policing, to limit state market subsidies, limits on migration, or anticompetitive legislation and rulemaking. Mr. de Villepin, now freed from the economic limits an EU constitution might have imposed, may seek to test competitive economic boundaries. Such action would be highly damaging to the potential for a single EU market. EU's leaders should act quickly to prevent such action.

New additions to the EU from central Europe may be most concerned by the potential for anti-market movement this vote represents. With complaints of polish plumbers and other competitive job loss to the east, and fears of an influx of workers after a Turkish entry into the EU, there is real fear that the French and Dutch votes could break any opportunity for further enlargement of the RU. The leaders may renege on Romania and Bulgaria's admission two years hence, or even end the planned talks for Turkey's entrance this October.

But enlargement is the most successful EU policy to date. Accepting ten members last May created a large zone of peace, increased economic prosperity across all of EU bordering states, and helped increase economic growth throughout the original EU member states. Accepting the Balkan countries and Turkey are likely to produce the same results. Accepting Turkey is of strategic value, providing a bridge between the West an Islamic states. Given the outcome of this vote, politicians should carefully consider the damaging potential of further referendums to the goals of statesmanship.

ORIGINAL TEXT: Enlargement has been easily the most successful EU policy of all. Taking in ten members last May has helped to create a zone of peace and growing prosperity on the EU's borders, and also imported much-needed economic dynamism into the old continent. Similar points can be made in respect of the Balkan countries—and for Turkey. Turkish entry would also bring large strategic benefits, helping to defuse tensions between the West and the Islamic world. It is true that Europe's voters remain to be persuaded of any of these points, but that is at least partly because their leaders have barely begun to explain the case for enlargement. Given that France and others may well put any further expansion to referendums, politicians need to learn some better salesmanship fast.

But the most important lesson to learn from these referendums, is that economic growth and poor unemployment results are the most pressing issues. It is clear that the poor economies of the euro-zone is the central cause of voters' dissatisfaction. The deep unpopularity with the Schröder and Berlusconi governments only confirm this opinion.

The cure for this is easy: more economic market liberalization throughout the EU. It worked for Britain, Ireland, and Scandinavia, it will work elsewhere as well. The EU commission has been promoting these reforms through the Lisbon agenda. But France, Germany, and Italy have been obstructing these reforms due to voter objection. The populations of these nations soured to these market reforms due to a prior reform campaign that was poorly received. So many leaders are even less likely to push for these market reforms, no matter that they are so desperately needed.

A most unfortunate outcome. To continue on without market reforms will only continue poor growth and high unemployment which can only further increase voter dissatisfaction. But a final lesson to be learned from the vote is that to impose change from the outside, however done, which was cause for the constitutions demise. It is only when each nations' own leaders finally understand how critical market reform is to their own political survival that success will be achieved. Subsidiarity, can not force correct policies upon all.

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