Destination Europe
From The Wall Street Journal Europé 2000-10-05

Not for the first time on Tuesday night did Jacques Chirac express his impatience with the pace of integration in Europe. "We have declared a common will. . . to preserve the possibility of the most determined countries pushing ahead in an expanded union," he said. This was a repeat of his call earlier this year for a "pioneer group" to proceed with further cooperation and let the laggards lag if they will.

We're all for flexibility, so if the French and Germans and any others think they can agree on a common budgetary policy or other subjects, we suppose they ought to go ahead. But we're tempted to ask, what's the point?

The fact is that Europe is already composed of two or more speeds. Some EU members have opted out of the single currency, as Denmark did last week, or other policy-making areas. There is a Euro-12 group of finance ministers of single currency members. Not all EU members are members of the Schengen group that has abolished internal border controls. Modifications to the Amsterdam Treaty in Nice in December are likely to make "enhanced cooperation" even easier for those who wish it.

But aside from seeming a bit superfluous, the idea of a two-speed Europe implies that there is some destination yonder where the pastures are greener. On the contrary, we'd suggest that European integration is well advanced and that future progress will depend less on strengthening the "core" and more on enlarging the whole.

The European Union already has a single market -- if still not an entirely open one. It has a single currency, if still not an entirely credible one. It has a big-footed competition commissioner who can make American CEO's quiver in their wing-tipped shoes. It has harmonized standards on a vast array of products and services meant to facilitate cross-border trade (though some barriers still exist). The vast majority of national laws and regulations now comply with EU directives or stem from them. Europe negotiates trade deals with one voice and increasingly takes a common position on international crises such as the one in Kosovo, though a common foreign policy is yet a long way off.

As for building on these achievements, Europe has a full plate. There is the grand project of EU enlargement, the thorny issue of further telecoms liberalization, the stuck-in-the-mud issue of agricultural reform. There is work to be done so that the single market functions better in insurance and banking among other fields.

While it is conceivable that the kind of hyper-integration that the French seek can be obtained among a smaller clique of European partners, it will be interesting to see how much agreement really exists on that agenda. At any rate, this would not be practical or desirable for a wider European membership. It is hard to imagine countries integrating their budgets, economic policies or foreign policies without increasing the democracy deficit that is Europe's biggest credibility problem.

But it's not hard to see why Mr. Chirac isn't content with the current level of integration, and, for that matter, neither is German Foreign Minister Joschka Fisher, whose federalist proposals go even further. The vision these two men hold is of a two-speed Europe in which France seeks to cement its bonds with Germany in the equivalent of a Paris-Berlin imperium at the core of the EU.

But the rest of Europe won't be buying. The Continent has become a more pluralist place. A caucus of more independent-minded countries has asserted itself. Some of them -- Britain, Spain, Ireland -- are more economically liberal than the "core." Others -- Denmark, Austria -- are less inclined to trust European institutions and resent France's grand planning. The British government nixed plans for an EU-wide withholding tax. Ireland has balked at proposals to harmonize taxes.

Ironically, these developments may not have been possible were it not for the very fear of change that animated the integrationist policies of Francois Mitterrand, Jacques Delors and others in France and Germany who championed European integration. For them, economic integration was not an end in itself. A unified, powerful Europe would act as a sort of megaphone for those whose voices didn't project as far as they used to. Instead, happily, integration has proved a catalyst for liberalization.

The goal now must be enlargement and improvement toward more liberalization. Yes, it would be nice if both happened faster and a few visionary European leaders would show the way.

Somehow, that doesn't seem to be the direction Mr. Chirac was suggesting.

Danish Voters Refuse to Replace Kroner With Common Currency

Det är svårt att se hur EMU skulle kunna lyckas. Samtidigt tillåts inga misslyckanden. Vad som än händer kommer processen att präglas av konflikter mellan Tyskland och Frankrike. Europa kommer nu att drivas mot en federation eller mot upplösning med utbredd vänster- och högerextremism. USA bör förhindra ett sådant sammanbrott. Men det betyder inte att vi bör stödja vilken sorts integration som helst. Det skriver USA:s förre utrikesminister Henry Kissinger.

Washington's unspoken doubts about Europe
FT, Gerard Baker, 2000-10-05

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