Orchestrating Europe (Text Only). Keith Middlemas

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СКАЧАТЬ of harmonization, for its banks had no wish to fit in with German requirements on taxation – especially withholding tax – nor to change the laws on banking secrecy: the Luxembourg economy benefited too much to envisage a truly level playing field.

      IRELAND

      Entry to the EC had offered Ireland the chance to break out from its narrowly constructed, protectionist, rather bigoted provincial identity, to become a distinct European nation. By 1980, largely through its EC links, it had also escaped the long shadow of the United Kingdom and its poor and backward economy had experienced a greater recovery, and greater politico-cultural benefits than either of the other 1973 entrants. In the early 1980s, Ireland also enjoyed regular trade surpluses¹⁷ and financial transfer payments.¹⁸ In its economic aspect at least, the public was united: 83% had voted in favour of entry in the 1972 referendum and 68 7% were to vote for Maastricht in 1992, despite the fact that previously undreamt-of legal and constitutional implications had emerged.

      New affinities with France began to replace the ancient ambiguity of cohabitation with Britain. In its first presidency in 1975, Ireland was able to stand up on the international stage as Garret FitzGerald addressed Commission-Council relations directly, having negotiated ably with the United States in Henry Kissinger’s day. It also subsequently played a mediating role during the second oil shock, despite problems with the European Parliament.

      Agriculture benefited unequivocally from increasing specialization while industry drew in foreign investment, particularly from Germany, to replace its formerly sheltered sectors – though this came at the expense of local capacity. Despite the disruptions so caused, Irish governments retained their interests in liberalizing their domestic markets. But EMS membership, the only alternative to linking the punt to sterling, produced a hardening currency, welcome for its disinflationary effect but unwelcome in its impact on domestic production in the early 1980s. Some of this disadvantage was offset by transfers from the EC’s Regional Fund because all of Ireland still qualified for assistance.

      Manufacturing and food processing would have suffered in any case from global changes. The prospect of a link between the internal market and structured funding helped to mediate this, and to curb any hankering for a repetition of the failed experiment in protection during the 1960s. Wisely, Irish governments used EC money and technology transfers to address structural failures. This was the overt reason for going forward to the single market, as the Dooge Committee recommended. But, as the Fine Gael party saw, structured change would be the real means to modernize the economy in the European dimension, to which a purely national market was an obstacle.¹⁹ This insight passed in due course to Charles Haughey’s Fianna Fáil government which, despite its historic tendency towards isolation, was content to accept that the country’s future lay wholly in the EC.

      That there would be costs in unemployment, rising national debt, and disruption of rural society was not denied. The EC could moderate the pain, increase economic and social cohesion, and restore a measure of real independence to offset the surrender of formal sovereignty. This was a synoptic viewpoint, in sharp contrast with Britain’s, shared by farmers, trade unionists and most of industry, despite the predicted impact of EC imports on domestic market share: in the late 1980s and with the support of the Irish Labour party, it was to lead on to support for EMU and European Union.

      DENMARK

      Denmark, like Ireland, found itself faced by economic readjustments after entry in 1973, but without a basis of political consent. The EC had until then been presented as a superior sort of EFTA, a customs union with a few ‘political dreams’ attached. Membership was already a contentious subject and this was not alleviated by the first, unfortunate, Danish Presidency, which took office after only six months’ membership experience, at the time in 1973 when the oil shock hit the EC. The Social Democratic party remained as divided as the British Labour party, while fears persisted among the Six that the Danes would use the EC as a milch cow. These were dispelled during subsequent Presidencies: in 1978 by an unsuccessful Danish attempt to launch a growth programme, and in 1982 when, in Copenhagen in June, the odium for lack of progress fell on Britain.

      Denmark’s complex and devolved decision-making processes ensured that in the absence of public consensus the passage to the internal market would be difficult. The White Paper’s mixture of economics and politics, and disputes between the government and the Folketing over whether EC affairs counted as foreign or domestic, made it hard for the government to take decisions and helped to produce an appearance of obstructionism.²⁰ At home, government usually won its case but at the price of later electoral retribution. To get the Single Act through, it had finally to by-pass the Folketing majority (80 to 75) with a national referendum (56.2% in favour, 43.8% against).

      The internal market offered clear advantages to industry and consumers, yet morbid fears persisted about the EC’s bureaucratic centralization, and the portents of harmonization, as a threat to ecological purity from an overweening EC state. Without a clear mandate, the government confronted a range of domestic pressure groups which feared liberalization. But the Confederation of Danish Industries favoured the single market, in order to achieve a stable market for its few but globally oriented medium-sized companies. For them the EC was the home market, and although they disliked talk of industrial policy, they remained fiercely antiprotectionist. But the Confederation represented a small sector of the population with only 300,000 employees, fewer than Siemens employed in the EC.

      Swayed by these pressures, and different oppositions, the government alternated between alliances with Britain (for example on aspects of the Dooge Report), and a claim similar to the Netherlands that institutional reform was essential to restore the EC’s dynamism. Denmark (whose currency link to the DM owed more to economic force majeure than political affinity) was seen therefore as contre: against inter-governmental action, political union, and EMU. It voted against an IGC in Milan in July 1985 but then later conceded, anxious not to be the only member state left out.

      GREECE

      Seven years after the end of the military dictatorship, the Karamanlis government from 1974 to 1981 attempted to modernize the Greek economy and transform Greek attitudes through the medium of the EC application. But this project (with intrinsically similar aims to those of Turkey) was undermined by the rapid rise of Andreas Papandreou’s ostensibly socialist but in practice populist-left party, Pasok, from 1977 to its election success in 1981.²¹ At once the Accession Treaty, hard won at home by Karamanlis with Franco-German backing in the Council of Ministers, came into question. It was the Pasok government and its leader, according to other members states’ opinions, who were responsible for the Athens debacle in December 1983 and, more persistently, for blocking the Commission’s new plans for standard-setting and mutual recognition.

      Much of this could be ascribed to the inexperience of a small, relatively backward state emerging from a harsh military dictatorship; a measure of local demagoguery and political-administrative corruption was predictable. But Pasok’s ‘third world orientation’ and Greek reactions to the Turkish invasion of northern Cyprus in November 1983 estranged Greece from the EC’s mainstream, as could be seen from factious behaviour of large states during the Greek Presidency.²² Greece’s blatant exercises in renegotiation to gain maximum advantage early in 1982, and again before Spain was finally allowed entry, left Greek membership with few admirers and appeared to prove that Greece was prepared not only to milk the EC but to hold up its essential business in order to do so. Paradoxically, this helped to convince the waverers, notably Margaret Thatcher, that some measure of QMV was essential (see above, p. 122).

      Yet the Greek government had serious problems to overcome at home, having to confront very inward-looking factions and an avowedly sensationalist press. There was good evidence of a will to do its EC duty, as the Pasok government eventually settled the quarrel over air bases with the USA and moved away from its third world policy, while the Turkish invasion helped eventually to introduce a period of learning on both sides. The appointment СКАЧАТЬ