The Italian banker and politician Padoa-Schioppa used to describe Great-Britain as the Venice of Europe. Drawing a comparison between the Italian unification in the 19th century and the present process of European integration, Padoa-Schioppa suggested that the UK is and will remain as reluctant to give up the pound in favour of euro as Venice has been to join the Italian lira. The implication of the comparison is, of course, that, however grudgingly, in the end the UK will accept the common European currency as well.
Guest blog by Jaap Hoeksma, Philosopher of Law, Director of Euroknow and Creator of the Boardgame Eurocracy
Padao-Schioppa's prediction is fiercely challenged by the Financial Times. At the height of the global financial crisis in 2011 FT started a series of comments under the title: Rethinking Europe. Reflecting on the legacy of Hobbes, the editors argues that the time of multilateralism is over and that future belongs to the traditional, well-tested nation-state. In this perception, Europe is returning to the Westphalian system of international relations rather than moving beyond the concept of indivisible sovereignty. This view has far-reaching implications both in the political and the financial domain. It underpins the political desire of PM Cameron to re-design the EU as a free trade area, without interference from 'Brussels' and European courts. At the same time, it renders the efforts to construct a common currency futile and irrelevant. In the Westphalian approach, each currency must be backed by a state. States have the prerogative of raising taxes and are therefore able to repay their sovereign debts. Since the euro lacks the support of a sovereign state, the common currency is doomed to perish sooner or later.
Seen from within the Westphalian paradigm, this analysis is entirely correct. Any philosopher of law or political commentator who assumes that sovereignty is a one-and-indivisible concept, must conclude that the EU can't exist in its present form and that the euro will soon turn out to be a short-lived experiment. The hallmark of the EU, however, lies in its flexible approach to the concept of sovereignty. From the outset, the process of European integration has been based on the presumption that it is possible for states to share the exercise of sovereignty without losing statehood. Seen from this perspective, the development of the EU can be accounted for in an altogether different narrative.
The novelty of the EU lies in the endeavour to transform an international organisation into a common democracy. Although this thesis is anathema to the proponents of the Westphalian system of international relations, the EU has developed its own dynamics. The desire to prevent war materialised in 1952 in the creation of a common market for coal and steel. As the experiment in sharing sovereignty delivered tangible results, the partnership was broadened in 1957 to the entire economy. The EC Court of Justice established in 1963 that the EEC constituted a common legal order, in which the nationals of the member states were called upon to co-operate. In 1979 the citizens of the member states received the right to participate in the first direct elections for the European Parliament. As a result of the adoption of the Single European Act the principle of voting by qualified majorities became part and parcel of the functioning of the then Communities.
The qualitative change brought about by the 1992 Maastricht Treaty consisted of the introduction of a common citizenship of the Union. Consequently, the Treaty on European Union (TEU) made it possible for the EU to be described as a 'Union of sovereign states, in which the citizens of the member states are also citizens of the Union''. Moreover, the TEU foresaw the creation of a common currency.
The 1997 Amsterdam Treaty contributed to the process by introducing 'democracy' as a core value of the Union in itself. Three years afterwards, the preamble to the Charter of Fundamental Rights of the European Union explicated that the EU is based on the principles of democracy and the rule of law. This consideration has gained the more relevance since article 6 of the 2009 Lisbon Treaty stipulates that the Charter shall have the same legal value as the Treaties. By establishing that EU citizens are directly represented at Union level by the European Parliament and that the functioning of the Union shall be founded on representative democracy, the Lisbon Treaty seals the evolution of the EU towards a common democracy. As a result of this ongoing process the EU may now be described as a 'union of states, wherein the citizens can participate both in the national democracy of their member-state and in the common democracy of the Union'.
In conclusion, it may be acknowledged that changes of paradigm tend to have far-reaching consequences. The possibility of such a process happening should therefore not be categorically disregarded. In the context of the debate about the future of Europe this suggestion should especially be taken to heart since the EU provides ample evidence to conclude that a different perspective on international relations is becoming a living reality.