Orchestrating Europe (Text Only). Keith Middlemas

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СКАЧАТЬ inside the Parliament, while the ‘outsiders’ (all communist parties save in Italy,³⁰ both main parties in Britain, many French socialists and the majority of Gaullists) emphasized inter-governmentalism at the European Parliament’s expense.

      Meanwhile the ECJ began to accumulate a body of judgments which increasingly underpinned the Commission’s initiating role. In Kramer (July 1976) it ruled that EC institutions’ competences within the EC extended under the treaties to the international engagements required to fulfil them. In March 1976 came the Simmenthal judgment that defined direct applicability to mean that EC legislation had to be implemented uniformly in all member states, not only through transposition but implementation and enforcement – which implied a direct obligation by governments towards individuals to implement directives. This had a stringent effect not only on backsliding states (Italy being already notorious) but also gave recourse to individuals or firms prejudiced by their own government’s failure. The Court’s 1978 judgment against Distillers’ policy of pricing one brand of whisky differently in different countries forced the company to withdraw from the UK market altogether. And in the area of state aids, where member states had frequently disobeyed rulings with impunity, especially in declining industries such as steel and shipbuilding, the legal revolution begun in the 1960s continued, leading to a sharp increase in the number of instances where the Commission dared to intervene.³¹

      By giving effet utile, that is interpreting the treaties to give the law its fullest and most efficient effect, with consequences often not obvious in the original texts, the ECJ thus widened the scope of EC law and extended Commission or other competences. Its continuous activity thoughout the 1970s was probably the most important single factor in keeping the sense of ‘Community’ alive in an era of inter-governmentalism.

      Simmenthal was perhaps inherent in the Treaties, but Kramer seems in retrospect a more creative interpretation, as does the ECJ’s October 1978 opinion in the ‘foreign policy arena’, that the Commission had competence to use international trade sanctions or embargoes to achieve the EC’s agreed aim. In the Roquette judgment (October 1980) the ECJ laid an obligation on the Council of Ministers to ask Parliament’s opinion – and to wait for it. But all these were overshadowed by the consequences of Cassis de Dijon 1979,³² which established the principle of mutual recognition of members’ own national standards and health or other regulations. The court ruled that a product which was lawfully produced, subject to minimum standards, and distributed in one member state could not be banned from sale in another unless it constituted a clear risk to public health.

      The political extent of this battle was not won immediately. In the always contentious area of foods, exclusions and evasions continued, even though the criteria were outside the food standards arena: France ignored both the rules and the ECJ’s judgments by banning lamb imports in 1980, Germany restricted beer under its ancient production regime, and non-fizzy mineral water,³³ Denmark for ecological reasons prohibited beer and soft drinks unless sold in recyclable containers, Italy rejected German pasta, not being made with grano duro, Belgian margarine was to be sold only in cubes not rectangles, and so on. Whatever its logical consequences for the generic harmonization policy, the Cassis de Dijon judgment and its sequel, the pressure vessels case which Arthur Cockfield used in the mid–1980s, could not solve all cases. Indeed similar obstacles survive today, in complicated, obscure forms (such as the effects of the German waste and recycling law) requiring in most cases to be abolished one by one.

      Yet it is hard to overestimate the significance of the new approach in which the establishment of basic standards and mutual recognition replaced harmonization. From that point on, the Commission sought to collaborate more effectively with member states’ own technical departments and standards agencies, and to relegate Article 100 (harmonization) only to areas essential for the EC as a whole. By insisting on the overriding aims of the Treaty, the ECJ had given the Commission a powerful instrument to break up the huge log-jam of draft legislation stacked up by a decade of unsuccessful detailed harmonization. It may even have saved the EC’s original ethos from the delays for which the Council and its members were to blame; it certainly helped to recover momentum and renewed the internal market’s attractiveness. It also established a golden rule: that future directives and rules should be simpler, less specific, and aimed at setting basic standards in a general context within which national agencies could operate: if they wished, more but not less strictly.³⁴ A long search for general EC competences thus led to an early definition of what subsidiarity (a phrase harking back to 1957 if not the 1890s) might eventually mean.

      The second OPEC oil shock forced the crude oil price to over $20 a barrel at the end of 1979, helping to precipitate a severe and prolonged recession. Domestically, the EC’s endemic budgetary crisis was reinforced by the new British Conservative government’s determination to revise downwards its net contribution. Margaret Thatcher’s single-minded advocacy of ‘our money’ galvanized the next Dublin Council in November, so that the fractious disputes about the EC’s budget overran into farm prices and the common fisheries policy. Thatcher took the subsequent compromise solution with ill grace, letting it be seen as merely a temporary expedient.

      In that same, particularly gloomy, year, the EC’s international context was disrupted, firstly by events in Iran (the Shah’s fall, the seizure of American hostages, and the end of Carter’s presidency), then by the Soviet invasion of Afghanistan (roundly condemned by all EC members in January 1980) and thirdly by the new Reagan presidency’s apparent intention (with Thatcher’s support) to revert to an arms race in order to counter and if possible permanently impair Soviet superpower capacity. Tensions rose at the same time in the Middle East and in Poland, where Solidarity’s early successes – though partially reversed by General Jaruzelski’s military dictatorship – exposed both the limits of Soviet power in eastern Europe and the unstable nature of Comecon, the state trading system linking Soviet and satellite states.

      The EC coordinated its responses to these crises rather more successfully than it had done in 1974, though the EC’s London Report pointed out the shortcomings in its political cooperation processes.³⁵ But the possibilities of cooperation were limited both by the recession and the ‘sovereign debtors’ crisis (Mexico, Brazil, Argentina, Poland) which lasted well into 1982 with consequences lasting to the present day (Brazil’s debt, for example, had increased from $63.5 billion in 1980 to $116.5 billion in 1991). The recession laid serious, long-lasting burdens on European industries which found themselves at the same time exposed as inefficient, overmanned and technologically backward in competition with Japan and the new Asian ‘tigers’, while the debtors’ crisis tested the banking systems almost as severely as the 1974 liquidity crisis. Steel suffered worst of the industries: this time, however, the British steel strike, and its outcome – defeat for the unions and harsh rationalization – provided a contrast with the EC’s crisis cartel solution, following the 1975–6 model, which was instituted in October 1980.

      Such a conjunction of severe economic and strategic problems encouraged EC governments to respond in a piecemeal fashion and inhibited their feelings of commonalty, except in the most defensive, protectionist sense.³⁶ Germany’s earlier attempt to reflate and act as the EC’s motor led to pressure on the DM, a deficit and high interest rates. French policy in 1981–3 moved rapidly in the other direction. A period of frequent realignments followed in which, given the existence of capital controls in most member states, domestic players rather than world markets set interest rates, allowing France until March 1983, together with Italy and Ireland, to devalue apparently without penalty, whereas Germany, Belgium and Denmark emphasized currency stability. But when France reversed its policy in March 1983, it become clear that Italy and Ireland would have to follow. Even the Netherlands, which had stuck with the DM, would have to switch from neo-Keynesianism to the disinflation, industrial adjustment and supply-side policies already being put into effect in Germany by the Kohl administration.

      It was hard for the Commission, whatever its responsibility for macro-economic guidance, to check such defensive, protectionist activity during the recession СКАЧАТЬ