European Union

To Brexit or Not To Brexit

Posted on by Susanna Cafaro

The nowadays famous article 50 of the EU Treaty didn’t exist before the 2009 Lisbon reform.

The founding fathers’ vision of an ever closer union didn’t contemplate a way back … or a way out. The marriage had to be for life. But then, after the big enlargments in 2004 and 2007, some practical minds decided to foresee the possibility of a divorce.

And here we are, with a divorce we didn’t expect to see.
As a British colleague made me notice, the 48% of the voters who expressed the will to remain are not parties in this divorce process, they are the victims: the children.

And the divorce is not formalized yet and this doesn’t seem to happen anytime soon.

Those who say that enacting art.50 is a competence of the British parliament are certainly right, as the  parliament ratified and enforced the European treaties in the British legal order and cannot be bypassed by the goverment, repealing these acts. By the way, both the parliament and the government  look reluctant as they didn’t really want this outcome.

Those who say that the will of the citizens cannot be ignored are right too. It is absolutely reasonable that such an important decision should require a larger majority, but there wasn’t any rule about it and a majority won.

Both the fields -the Brexit supporters and the remain supporters – have solid arguments on their side.

But there isn’t only the British membership of the European Union at stake. That would be too simple an assumption.

The remain voters are not necessarily supporters of this Union, which has its own undeniable flaws. Most of them stand for an idea: being united with our  diversities, being  stronger together, being peaceful as a family which solves its own divergences discussing at a common table.
Most of them know that the Union is a work in progress which can be improved only from the inside. And they know there is much to gain from the EU’s open borders and European citizenships’ rights if you are willing to move, explore and challenge yourself and your national limiting beliefs. They reasonably don’t want to lose these rights.

The Brexit  voters come from a range of different experiences:

  • Some of them  have suffered and still suffer austerity;
  • Some identify Europe with a suffocating bureaucracy and  a political failure, which is how Europe as been sold to British people for decades: as a useful scapegoat.
  • Some expressed a feeling of antipolitics, they would probably have rejected any political establishment and just prove the  crisis of democracy we all see around us.
  • Then there are the champions of national sovereignty, and all sorts of nationalism.
    This feeling has been fueled by the huge migrations from the southern shore of the Mediterranean. It is a real emergency and nationalist attitudes won’t help to find a solution whatsoever. But still we can understand where this feeling comes from: fear. Fear of invasion, fear of sharing already meager work opportunities and national resources.
  • Finally, some think that a free rider state will thrive on the global market, possibly a more and more deregulated global market. This is a completely different attitude, but still anti-EU. And more than the other views it looks anti-historical as the world goes in the opposite direction: solving problems which become more and more global will require more integration, not less. Even little tax heavens are (finally!) under threat of extinction.

    I am totally empathetic with the “remain” voters and still, while I wish the best outcome for them, I wonder if a Brexit is politically avoidable.

    However the dilemma will be solved, some lessons need to be driven:

    ⁃       austerity has not been the solution to the financial crisis. In some countries it even worsened the economic situation. In many states unemployment is still at record level. The price was especially paid by the weaker part of the population, poverty and inequality provided a good soil for populism and nationalism. Moreover, it has been errouneously attributed to Europe, while it was a national solution (as I already explained).
    ⁃       There is a crisis of democracy and a rise of antipolitics almost everywhere. I have my theory about that: the nation states are not anymore the right institutional framework for tackling most of our problems, we need to go more local and more global at the same time. But – be right or wrong my explanation – we need a serious reflection on our contemporary democracies.
    ⁃       Finally, we need to work for a better Europe, we owe this to those who voted against it as to those who voted in favour. I have written about this and for sure I will write more extensively in the future. I’ve already been too long!

    For those who arrived to the end of my reflections: these are challenges not just for polical elites, not just for governments and states, but for all of us. And this is a call of duty for new brave political leaders at all levels.

We are all French, we are all Europeans.

Posted on by Susanna Cafaro

candle

After the tragic events in Paris on Friday evening, we Europeans were all under shock. From Italy to Sweden, from Greece to Portugal, we grieved and lightened candles and prayed. We all knew that Paris was a symbolic place (how powerful): the attack was brought against our core values,  the values of a democratic, liberal society, based on the rule of law and the respect of fundamental rights, free, multicultural, sexually-liberated, open.

The freedom of speech, of religion, of circulation are suddenly at risk and we know that we have to fight a new kind of struggle (of war, if you want) – totally different from the previous ones – the war to keep our societies open, because if we react in the old-fashioned style with  closure and protectionism and hate, if we step back from liberty of speech and religion, the enemy has already won.

It’s not an easy task. The immigration emergency, the rise of populism and the risk of extreme right political parties taking advantage of what has happened is definitely high. The point is that our states have partially failed in making us feel safe and, at the same time, open. We can observe decaying national identities as here and there states failed the challenge of integration; moreover the worsening of economic conditions favored urban subcultures and rebellions of the excluded ones. Jihadists grown up and living in Europe are a very bad symptom of our societies’ health status.

We must roll up our sleeves and rebuild trust in our values, which are the very fabric of our identity.

We felt all Europeans after the Paris tragedy, we recalled what makes us stand together against terror, let’s start from there. Let’s work on our European identity, which shouldn’t surface only in the bad moments, but help us overcome the failure of states with its motto “united in diversity”, able to comprise all of our populations, all of the honest migrants who came here for a better living and are ready and willing to respect our values.

Of course, any reaction, military, political and diplomatic should be likewise European. To be as symbolic and significant as the aberrant acts which injured Paris, heart of Europe.

The Case for Technocracy (and the Case for Democracy!)

Posted on by Susanna Cafaro

International organizations are mostly technocratic institutions. Central banks are definitely technocratic institutions. Many national authorities responsible for supervision and monitoring are inherently technocratic.

It sounds like a bad thing, as technocracy means literally power in the hands of technicians or experts. And experts are selected after the evaluation of knowledge assets and experience. So, basically, if an institution is an example of technocracy, it is not an example of democracy.

Technocracy has old roots as among the most ancient civilizations the power was in the hands of those who had knowledge. It was an assumed truth that knowledge goes hand in hand with wisdom (and sometimes even with divinity!).

Nowadays, there are some good reasons to choose technocracy over democracy, even if it isn’t often the case:

  1. We want that our authority takes not the more legitimate or shared decisions, but the best ones.

This happens when decisions are just too difficult for non-experts, as it happens in the field of monetary policy: deciding which is the right amount of money to print or which is the correct interest rate to keep prices stable in the current circumstances is the result of a knowledge-based approach. Only few people are qualified enough to understand the difficult mathematical reasoning behind this kind of decision.

2. We want independent, impartial decisions.

An antitrust authority under political influence or pressure by public opinion wouldn’t do properly its duty. Similarly to the judiciary, monitoring authorities have to apply rules impartially, in good faith, after a qualified evaluation.

Some international bodies are similarly  committed to super partes evaluation, to focus on the common interest which is not necessarly the interest of the majority. This is the case for the European Commission which interacts regularly with the Council of Ministers and the European Parliament, in charge to  represent respectively the majority of states and the majority of populations, so the Commission offers a different perspective.

Conversely, there is a wrong reason to choose technocracy over democracy, it is the lack of trust in the political elite and the need for a radical change (I think of all the so-called “technical governments” we had in Italy in the past two decades, for instance).

It is a lie we tell ourselves: a minister plays necessarily a political role, no matter where he comes from or how he has been chosen. So, this is just a way to mistify or hide the reasons behind political decisions which are never simply “technical”.

All the organizations whose powers require political discretion, states in the first place (but not just states) cannot be managed as technocracies. Such a choice would turn back the clock to pre-democracy ages, while what we want is to improve our level of democracy.

Moreover, even if the activity of a technocratic authority is not, by definition, democratic, choosing the experts in charge for technocratic decisions – chief officers, board members, central banks presidents – is definitely a political decision, so we expect it to be democratic.

Some international organizations, which still obey to the technocratic model, increased their role over time and should introduce democratic elements to complement the technocratic ones – just like in the EU the technocratic body -which is the Commission- is complemented by the Parliament and the Council.

Finally, how can we trust a technocracy?

All the technocratic institutions show  – or should show  – two basic features to guarantee that their power will not be abused:

  • a clear mandate
  • an accountability framework

They don’t operate in a splendid isolation, they enjoy relevant powers for some good reason. It is up to them to deserve people’s trust using them properly or – if it is the case – to be held responsible for their misuse.

These two elements  – a limited allocation of competences and a duty to be accountable-  reconcile democracy and technocracy, so the two may be an useful completion one of the other.

Why Europe is Losing its Credibility over the Greek Crisis

Posted on by Susanna Cafaro

I will write now something quite subversive: the EU is a reasonably democratic entity.

It is the only international organisation to have a legislative power stemming directly from citizens, with its two-chambers system: the Parliament directly representative of its citizens and the Council, directly representative of governments which are too – at national level – directly representative of their citizens. Its powers are conferred by treaties duly ratified by member states’ parliaments or even through referendum. The legitimacy of EU acts is guaranteed by a judiciary system, composed by national courts and by European judges.

But, not surprisingly, the perceived level of democracy of the European system is now lower than ever.

There is a simple reason for that, which unfortunately is not explained and even less understood by media (and so, of course, by citizens): economic policy is NOT an European competence. And economic policy is what dominates the political debate nowadays.

The compromise agreed on in the Maastricht treaty – never changed since- is that monetary policy is an exclusive competence of the Union, while economic policy is a competence of the member states. Of course a single monetary policy cannot survive with 19 different economic policies. That’s why the Treaty on the Functioning of European Union provides for a coordination of national economic policies – now reinforced through the so called “European semester” and why there are a number of prohibitions aimed at avoiding excessive divergences among national economies (the so-called Stability Pact).

The coordination of national economic policies is a mere intergovernmental procedure, agreed among finance ministers and heads of state and government, without any judiciary control and – even less- democratic guarantees.

Why monetary policy was transferred to the European level, while economic policy remained national? Because budgets remained national.

The EU has a tiny budget (less than 1% of the EU GDP) which cannot allow any deep intervention in the management of crises or the fostering of growth. So, the EU can just recommend such measures to member states.

On top of that, states are not equal.

Not only they differ significantly in size and GDP, but they contribute differently to the EU budget (we have already written about that). And they contribute  differently to the interventions which are outside the EU legal framework, as mostly happened in the management of the Greek crisis.

One of the most dramatic consequences of this crisis – whose extent has yet to be measured – is that many European citizens believe that what happened in the management of the Greek crisis is the normal way of functioning of the EU.

It is not.

I can tell you that Europe is better that that and can do (has done) better than that. It has provided over the years a significant increase of the rights of citizens in many core areas such as consumers’ rights, environmental rights, safety of products, right to move, work, study or be healed in other EU countries and so on.

Pity that nobody explains that, nobody writes about it, nobody takes a stance for minimum democratic standards in the management of coordinated economic policies.

The price Europe is going to pay for the intergovernmental (poor) management of the Greek crisis is a loss of credibility in all the other fields of intervention. Trust will take long years to be (hopefully) restored.

I hope that our politicians and journalists are aware of that.

Europe Day, When Supranational Politics Was Born

Posted on by Susanna Cafaro

The declaration of 9th May 1950 by the French Foreign Minister Robert Schuman is the foundation of the European integration.

It was a proposal to Germany and other interested countries to create a common independent authority responsible for managing the French and German production of coal and steel.

Iron and coal mines are on the borders between France and Germany and they have been the reason for many wars between the two countries. Moreover, the two natural resources were -at the time- the very grounding of a prosperous economy. For this reason, what may appear as a mere economic agreement was in fact intended to preserve peace and foster prosperity.

The proposal, inspired by Jean Monnet, suggested that the classic diplomatic way to manage intergovernmental relation could be overcome by a new method: a conferral of powers to an independent authority able to bind with its decision the member states. The European Coal and Steel Community had from the very beginning a Court of Justice, whose decisions were binding, and a Parliamentary Assembly. The proposal was accepted by Germany, Belgium, Holland, Italy, and Luxembourg.

The vision was already clear in the Schuman’s declaration:

“World peace cannot be safeguarded without the making of creative efforts proportionate to the dangers which threaten it.

The contribution which an organised and living Europe can bring to civilisation is indispensable to the maintenance of peaceful relations. In taking upon herself for more than 20 years the role of champion of a united Europe, France has always had as her essential aim the service of peace. A united Europe was not achieved and we had war.

Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity. The coming together of the nations of Europe requires the elimination of the age-old opposition of France and Germany. Any action taken must in the first place concern these two countries.

With this aim in view, the French Government proposes that action be taken immediately on one limited but decisive point :

It proposes that Franco-German production of coal and steel as a whole be placed under a common High Authority, within the framework of an organisation open to the participation of the other countries of Europe.

The pooling of coal and steel production should immediately provide for the setting up of common foundations for economic development as a first step in the federation of Europe, and will change the destinies of those regions which have long been devoted to the manufacture of munitions of war, of which they have been the most constant victims.

The solidarity in production thus established will make it plain that any war between France and Germany becomes not merely unthinkable, but materially impossible. The setting up of this powerful productive unit, open to all countries willing to take part and bound ultimately to provide all the member countries with the basic elements of industrial production on the same terms, will lay a true foundation for their economic unification.

This production will be offered to the world as a whole without distinction or exception, with the aim of contributing to raising living standards and to promoting peaceful achievements. With increased resources Europe will be able to pursue the achievement of one of its essential tasks, namely, the development of the African continent.

In this way, there will be realised simply and speedily that fusion of interest which is indispensable to the establishment of a common economic system; it may be the leaven from which may grow a wider and deeper community between countries long opposed to one another by sanguinary divisions.

By pooling basic production and by instituting a new High Authority, whose decisions will bind France, Germany and other member countries, this proposal will lead to the realisation of the first concrete foundation of a European federation indispensable to the preservation of peace. (…)”

What we define as supranational, is the original approach to problems whose dimension is just out of reach for single states, it radically differs from the international approach as it creates an authority and a will over the states, subject to the rule of law.

We have to thank Jean Monnet for the elaboration and first experimentations of this conceptual model, but the political courage of Robert Schuman was the necessary ingredient to make it a reality. The prompt acceptance by Konrad Adenauer and Alcide De Gasperi allowed this proposal to become a shared political project.

The brave campaigns by the European Federalists, after the impetus by Altiero Spinelli, founder of this political movement and author of the Ventotene Manifesto made the project evolve over time, to meet expectations of integration and democracy.

A tribute to all our founding fathers. For many of us, your message is still alive.

 

A Case-Study: The Greek Crisis.

Posted on by Susanna Cafaro

Much has been written about the Greek crisis.

Below, some thoughts on this story seen through the glasses of democratic standards and  -specifically-  through the two lenses of the legitimacy and accountability (3D democracy vision)

The financial crisis, in Greece more than elsewhere, has highlighted the erosion of state sovereignty in key areas of typical citizen-state relationships such as the welfare system and the labor market, in which the need for choices perceived as legitimate – but also accountable – is crucial. Some fundamental rights have been touched, some less fundamental ones have been significantly reduced.

Decisions had been taken by top political bodies (Eurogroup, European Council)  and technocratic institutions (European Commissions, ECB, IMF). Let’s put aside for a moment the good intentions as  restoring sound public finances: the simple truth is that parliaments have been ignored. The Greek Parliament – of course- but also the European Parliament.

The issue regards also the method and not just the matter. The solution to the issue itself -austerity or not austerity- is strongly influenced by the method used as some institutions are more easily driven to deliver rigor than growth. Moreover, they lack the necessary legitimacy and accountability to deal with individuals’ rights.

Conditions were attached to the Greek loan facility – a package of bilateral loans by Euro area member States complemented by an IMF loan. Two intergovernmental agreements were signed and entrusted the Commission to manage the package under strict conditionality. A loan facility agreement was then signed by the Commission on behalf of the Euro area member States and by Greece. Next, the economic conditions were agreed on in a series of Memoranda.

Their respect of the rule of law as well as their compliance to the EU Treaty and the EU Charter of Fundamental Rights couldn’t be assessed by the European Court of justice because of the widespread use of atypical legal acts as well as of their intergovernmental nature.

Why? Why the Eurogroup and the German Government had such a strong voice and the Court of Justice had not? Why the Parliaments were not in the debate? Why, even now, with a clear Greek vote legitimizing a different majority in the Parliament and a different vision we still see the old movie going on again and again?

Just follow the money…

Money is not from the EU, money comes from some European governments and from the International Monetary Fund . With some help from the ECB.

The EU budget is too tiny to cope with the crises: less than 1% of EU GDP. Moreover, the 28 EU countries were not all willing to contribute, so the Eurozone States had to manage the crisis on their own. They did it through intergovernmental agreements (as creating the ESM) and according bilateral loans. The IMF – traditionally leaded by an European-  was very sensitive to the problem (even too much, according to the BRICS).

And here comes the Troika…..

The Troika is nothing more than a committee of creditors, entrusted with the management of the loans. Of course it hasn’t any accountability. Its doubtful legitimacy and lack in transparency have been clearly pointed out by the European Parliament.

If we want to assess its accountability, we have to split it into its three components:

The European Commission is an accountable institution, it has to report to the EP, answer to MEPs’ written questions and could even be dismissed by the Parliament with a majority vote. The ECB too is subject to a monetary dialogue with the EP, even if less incisive than the dialogue the Commission has with the EP. Unfortunately, having them acting together confuses responsibilities and makes harder to assess the role of each institution for the decisions taken.

And then we have the IMF.

There is a story I want to tell you about the IMF in the Greek crisis:

In a IMF Country Report about Greece (June 2013) we can read that due to the process of fiscal consolidation  the country paid a too high a price in terms of social and economic losses: “Market confidence was not restored, the banking system lost 30 percent of its deposits, and the economy encountered a much deeper- than-expected recession with exceptionally high unemployment. Public debt remained too high and eventually had to be restructured, with collateral damage for bank balance sheets that were also weakened by the recession”.  The reports makes clear there were successes as well as “[N]otable failures” in the program.

This is somehow a progress in the culture of the institution: analyzing critically the consequences of their choices. For sure the establishment of an Independent Evaluation Office in 2001 contributed to such improvement. Nonetheless, who is politically responsible if a choice is reported wrong? are there any consequences? The answers are: 1) Nobody, 2) No.
A gap in accountability is more than evident.

There is much to say about the tangle of many potential conflicts of interests inside the Executive Board of the Fund and in the IMF itself that we cannot unravel all of them here (but we’ve done it elsewhere!).

What makes the Greek crisis an interesting case study -unfortunately for the Greek people- is that it makes clear that democracy matters. Beyond matters of principle.

What is also really sad (at least for me) is that Europe is losing its credibility over the Greek crisis.

How to Make World Peace

Posted on by Susanna Cafaro

It just happened to me to watch Troy Davis’ presentation at TED X Strasbourg

and I think that any global citizens should watch it as well: I couldn’t explain better how making world peace is the ultimate goal of supranational democracy…. and why supranational democracy is exactly what is needed to get there.

Thank you Troy Davis!

Supranational Vs International

Posted on by Susanna Cafaro

Why “supranational”?

When I started this blog I was in doubt. Such a strange word in the title? Will it be understood? Why not global democracy? or international democracy?

But no, no doubt. I know what I want to express here and it is not promoting some unspecified kind of global democracy. And, for sure it is not promoting international democracy.

Inter-national means between or among nations: an international organization is a system where states cooperate to common goals. The will of the organization is the result of internal procedures aimed at putting together the will of the largest number of states, as expressed by representatives of states.

Supra-national, instead, means over the nations: a supranational organization is over and beyond the authority of states. It expresses its own will.

We recognize a supranational organization by a number of distinguishing features: the decisions are adopted through majority vote; they are binding; bodies made up by individuals interact with bodies representing states, the rule of law and the respect of the decisions are guaranteed by courts.

But first and foremost, a supranational organization is able to impose its decisions even over states who disagree. And, in order to do so, it enjoys its own legitimacy, derived directly from citizens.

The best example of such  autonomous legitimacy is in the first two paragraphs of art.10 of the Treaty establishing the European Union:

“1. The functioning of the Union shall be founded on representative democracy.
2. Citizens are directly represented at Union level in the European Parliament.
Member States are represented in the European Council by their Heads of State or Government and in the Council by their governments, themselves democratically accountable either to their national Parliaments, or to their citizens.”

Now, you’ll think that I’m describing a peculiar system, which is just European,  but it isn’t so.

It’s true that this word, supranational, was the expression of what the Founding Fathers wanted for Europe (it appeared already in the Europe Declaration, 1951), but the system evolved over time and for sure it is much more supranational now than 60 years ago.

Other events occurred over the last decades; regional integration organizations evolved in south America, in Africa, in the Gulf: the seeds of supranationality were spread around and they started to sprout in different soils.

What was even more unexpected, even global organizations knew smaller but significant improvements: dialogues with civil society flourished here and there, ombudsmen, mechanisms for claims and  audit bodies were established. Individuals appeared on the stage.

To make a long story short, supranationality is not anymore an exclusive of the old continent, even if there it started first.

And here is where I want to arrive: individuals are an essential ingredient of democracy. They provide an organization with a legitimacy of its own. Purely international or intergovernmental systems may be (maybe?) efficient, but can hardly be defined democratic. And democracy simply is not a parameter of legitimacy in international law.

An easy reply could be: aren’t states representative enough of their own citizens to legitimate also the organization they join? Formally, it is so.

Substantially (i) most of them are not exactly democratic (and in global organizations this is a major flaw) and, (ii) even in the democratic ones, governments are often entrusted with foreign policy outside an effective parliamentary control and manage it in a logic of realpolitik, paying a special attention to national interests.

For all these reasons, I believe that international democracy is an utopia at best, most likely an oxymoron.

Global democracy is supranational or it is not democracy.