Culture & Ideas Ideas

Debate: A federation, yes, but what kind?

23 October 2012
Respekt Prague

Whether it be political, budgetary, or based on financial solidarity, the idea of ​​a more integrated EU is in fashion. But just what final form would the Federal Union take in the end? Nobody really knows, and that’s the whole problem.

When Angela Merkel, at an economic forum in Davos in January, diffidently mentioned federalism, her words essentially went down without provoking a great response. In the six months since then, though, notions about a federal EU have proliferated by the sackful. The head of the European Commission, Barroso, and some European foreign ministers have called for one, but no one from the Czech Republic has joined the chorus.

The roll call of "federalists" is growing (which this weekly welcomes), but this does not mean that everyone is talking about the same federation. The debate on the future of Europe shows an alarming ignorance of constitutional concepts among many politicians, and the result is verbal chaos.

New concepts are constantly emerging, but their meaning is searched for only afterwards: banking union, transfer union, political union, fiscal union, and so on. Some talk of greater centralisation, others about integration, still others about further harmonisation of laws, while some warn of a superstate.

What all these phrases mean is whipped up after the fact, and we would search for their meaning in a dictionary in vain.

In Canada, the U.S. and Germany, people know what a federation and federalism mean, because they live in federations. In the case of the Germans it’s a paradox that, despite living in one, they are unable to imagine a federation at the European level, and the idea of a federation within a federation (like Russian matryoshka dolls) doesn’t really appeal to them much.

The French, on the other hand, typically (with some exceptions) cannot even imagine federalism, which they confuse with centralism. As for the British, federalism is a symbol of one-sided decentralisation (parliaments in Scotland and Wales, but not in England).

What would not fly in the U.S.

The EU has a very small shared budget (one percent of the GDP of the entire EU) and plans to cut it further (to 0.8 percent), but in some centralising tendencies it has gone so far that, had those moves been tried out in the real American federation, the experiment would have failed. If individual states in the U.S. were ordered by a central authority to rubber-stamp the financial budgetary rules and budget advice sent to them (i.e., change their own constitutions), to submit their budgets to Washington for approval even before they voted on them themselves – and then send them back for inspection (which is the principle of the European fiscal compact), it would lead to a revolt and the American federation would break up.

On the other hand, building a federation is a long process, and according to the experts in this subject, it was only completed in the U.S. in the 1930s, once federal deposit insurance was made into law. We should note, however, that the eurozone is already approaching a common deposit insurance (as one of the defining traits of a federation) and other elements of a banking union in leaps and bounds. What is certain is that the crisis will not be overcome without some sort of shared budget and shared taxes. It follows from that that we in the Czech Republic should know very well what we will do if the federation is built in the eurozone and we are left on the outside.

Who makes history

Critics of federalism argue that the very idea is naive, and even dangerous, because there is no European political nation. An American is first an American, and only then from Minnesota. A German is first a German, and only then a European. 

The emergence of a European identity, however, can be "artificially" promoted and accelerated. This and that may help here and there: direct election of a European president, an Institute of European citizenship, some minimum common European tax, and so on.

The American political nation originated in that way as well (although differently and for different reasons than it probably will in Europe). First, it was only elected landowners who could vote, then taxpayers, women a hundred years later, and African Americans only recently. Nothing is ever done quite the same way twice. Americans began with a Ministry of Finance, Europeans with a Central Bank.

Critics argue that all political and (dis-) integration processes should be spontaneous and authentic, not artificial and elitist. But most of the significant shifts in the history of mankind result from the fact that people are led somewhere by someone.

Europe's future is unclear. A federation may arise, but the Union can also break apart. In any case, in building a federation it is important that at least the European elites finally begin to learn what a federation is and what it is not. That basis could be that federalism is not an elaborate construct, but a fundation built on values: on the containment and control of power, of counter-balancing and safeguards and on asymmetrical, reinforced protection of the smaller and the weaker.

Translated from the Czech by Anton Baer