Modern history

XXII

The Old Europe—and the New

‘You have to wonder why Europe does not seem capable of taking decisive
action in its own theatre’.
Richard Holbrooke

‘Si c’était à refaire, je commençerais par la culture’ (‘If I were starting over, I
would begin with culture’.)
Jean Monnet

‘It is always possible to bind together a considerable number of people in
love, so long as there are other people left over to receive the
manifestations of their aggressiveness’.
Sigmund Freud

‘What is the explanation of this curious combination of the permanent
unemployment of eleven percent of the population with a general sense of
comparative prosperity on the part of the bulk of the population?’
Beatrice Webb (1925)

The fissile political temper of the Nineties was not confined to the countries of the former Communist East. The same urge to escape the bonds of centralized rule—or else to relinquish responsibility for impoverished fellow citizens in distant provinces—was felt in the West. From Spain to the United Kingdom the established territorial units of Western Europe were subjected to extensive administrative decentralization, though they all managed more or less to retain at least the form of the conventional national state.

In some places this centrifugal propensity had already surfaced decades earlier, as we saw in Chapter 16. In Spain, where the longstanding demand for autonomy in Catalonia or the Basque region had been recognized by the new constitution, Catalonia especially had emerged within a generation as virtually a state-within-a-state, with its own language, institutions and governing councils. Thanks to a 1983 Law of Linguistic Normalization (sic), Catalan was to become the ‘dominant language of instruction’; ten years later the Generalitat (Catalan parliament) decreed the exclusive use of Catalan in kindergarten and infant schools. Not surprisingly, even though Castilian Spanish remained in use everywhere, many younger people were more comfortable speaking Catalan.

None of the other Spanish regions was to acquire quite this level of national distinctiveness; but then none of them carried the same weight within the country as a whole. In 1993 Catalonia, one of seventeen Spanish regions, accounted for a fifth of the country’s GNP. Over a quarter of all foreign investment in Spain came to Catalonia, much of it to the flourishing provincial capital, Barcelona; per capita income in the province as a whole was more than 20 percent above the national average. If Catalonia were an independent country it would count among the more prosperous states on the European continent.

One reason for the rise of a distinctive Catalan identity was an easily stoked resentment at the substantial contribution Catalans were expected to make to the national exchequer, thanks in part to the setting up in 1985 of an Inter-Territorial Compensation Fund to assist Spain’s poorest regions. But Catalonia—like the Basque country, Galicia, Navarre and other newly assertive autonomous provinces—also benefited from the hollowing out of ‘Spanishness’. Franco had exploited to exhaustion the traditional gamut of national claims—the glory of Empire, the honour of the military, the authority of the Spanish Church—and after his fall many Spaniards had scant interest in the rhetoric of heritage or tradition.

Indeed, rather like an earlier generation of post-authoritarian Germans, the Spanish were decidedly inhibited about ‘talking national’. Regional or provincial identification, on the other hand, was unpolluted by authoritarian association: on the contrary, it had been a favorite target of the old regime and could thus credibly be presented as an integral aspect of the transition to democracy itself. This association between autonomy, separatism and democracy was less clear in the Basque case, where ETA pursued its murderous path (even mounting assassination attempts in 1995 on both the king and the prime minister). Moreover, whereas the six million Catalans were prospering, the old industrial districts of the Basque country were in decline. Unemployment was endemic and income levels in the region were lower than in Catalonia, hovering close to the national average.

If Basque nationalists failed to capitalize on these problems it was in large measure because many of the region’s two million inhabitants were new to the area—by 1998 only one person in four could even speak Euskera, the Basque language. Not surprisingly, they showed little interest in separatist movements: just 18 percent of Basques expressed support for independence, preferring the regional autonomy they had already secured. Even a majority of the Basque National Party’s voters felt the same way. As for Herri Batasuna, the political wing of ETA, it was losing votes to moderate autonomists and even mainstream Spanish parties. By the end of the decade it had declined into an all-purpose outsiders’ party for disaffected Greens, feminists, Marxists and anti-globalizers.

In Spain, the splintering of the nation-state was driven by past memories. In Italy it was more often the product of present discontents. The traditionally dissident regions of Italy were in the far north: frontier zones where the local population had been assigned Italian identity within living memory—often as a result of war and usually against their will—and where most of them still spoke French or German or Slovene in preference to Italian. Much of the discontent in these areas had been mollified thanks to a series of agreements establishing newly autonomous regions: the Val d’Aosta in the Alpine north-west where Italy, France and Switzerland converge; the Trentino-Alto Adige, abutting Austria’s Tyrol; and Friuli-Venezia Giulia, in the ethnically uncertain borderlands along the Yugoslav (later Slovene) frontier. Such regions also benefitted (as we have already seen in the case of the Alto Adige) from a range of regional subsidies and other encouragements from the European Union in Brussels. By the 1990s, with the further help of Alpine tourism and the passage of time, Italy’s northern frontier lands had faded from political view: regional pockets in a regionalized continent.

Their place, however, had been taken by a decidedly more threatening form of regional separatism. Since 1970, in belated accordance with a provision of the post-war Constitution, Italy had been sub-divided into fifteen regions, in addition to five autonomous provinces (the three frontier districts together with Sardinia and Sicily). There were certainly sufficient precedents: Piedmont, or Umbria, or Emilia had at least as strong a claim to historical distinction as Catalonia or Galicia, and although the regional linguistic distinctions that had been so striking just a few decades before were now fading, they had not yet completely disappeared.

But the new regions of Italy—in contrast to those of Spain—were largely an administrative fiction. For all that they boasted their own elected councils and authorities—and employed large numbers of people—the regional units of Italy could neither overcome the ultra-local identification of Italians with their native village or town nor break the political and above all the financial reach of the capital. What the establishment of regions did achieve, however, was to remind Italians of the fundamental and continuing rift between the prosperous North and the dependent South—and to offer political expression to the resentments to which this gave rise.

The result was the emergence of something quite new, at least in the Italian setting: the separatism of the prosperous. The Italian north—especially the industrial and entrepreneurial towns and cities of Piedmont and Lombardy, and the thriving farms and small businesses of Bologna and its hinterland—had for decades been markedly richer than the rest of the country and the gap was getting larger. By the end of the 1980s gross regional product per capita in the Lombardy region around Milan was 132 percent of the national average; in Calabria, at the toe of the Italian boot, it was 56 percent. The poverty rate in the Mezzogiorno at the end of the Eighties was three times that of northern Italy. Whereas north and north-central Italy were comparable in wealth and services to France or Britain, the South had fallen ever further behind, opening a gap that was only made good in part by substantial cash transfers.

In the course of the 1980s a new political alliance, the Lombard League (later the Northern League, Lega Nord), arose to capitalize on a widespread belief that the ‘South’ had for too long been freeloading on northern wealth. The solution, according to the League’s charismatic founder and leader Umberto Bossi, was to gut Rome of its fiscal powers, separate the North from the rest, and ultimately secure independence for Lombardy and its neighbours, leaving the impoverished, ‘parasitic’ rump of the country to fend for itself. The resemblance to Catalonia (or Slovenia, or indeed the Czech Republic under Václav Klaus) will be clear.

In national elections of the 1990s the Northern League was able to command enough of the vote in Lombardy and the Veneto to ensure itself a foothold in conservative governing coalitions. Ironically, however, the League’s hold on office depended on its alliance with Silvio Berlusconi’s Forza Italia movement and the ex-Fascists of Gianfranco Fini’s National Alliance Party—both of which (the latter especially) depended for their support on precisely the poor, subsidized southern voters whom the League so despised. In spite of these mutual antipathies, then, and the illusions of Bossi’s more reckless supporters, there was never any serious question of Italy breaking apart or any of its provinces becoming independent.

Much the same was true of France, where the Mitterrand presidency undertook limited administrative decentralization and initiated some rather desultory efforts to disperse institutions and resources to the provinces. Of the country’s newly established regional units not even Alsace or the French Basque districts evinced much interest in cutting their ties to Paris, despite their distinctive historical identities. Only the island of Corsica saw the rise of a movement for national separation, based on a genuine sense of linguistic and historical uniqueness and the implausible assertion that the island would flourish with independence from the mainland. But, like ETA, the Corsican nationalists’ taste for violence (and inter-familial score-settling) confined their appeal to a minority.

What was distinctive about France was that whereas elsewhere in Europe politicians and commentators now paid formal homage to the virtues of autonomy and local self-government, even the faintest stirrings of regional separatism triggered in Paris an avalanche of neo-Jacobin disdain across the political spectrum. Moreover, the provinces of France with the strongest sense of difference—Brittany, for example, or the depopulated mountains of the upper Languedoc—had also for many decades been those most dependent upon government largesse. Everything from infrastructural spending on high-speed railway lines to tax benefits for inward investment came from Paris and there was never much support for the few remaining Breton or Occitan separatists, mostly ageing militants left stranded by the retreat from Sixties-era enthusiasms. Conversely, wealthy areas like the Rhône-Alpes region around Lyon and Grenoble might well have prospered on their own: but they had long since lost any memory of independence and evinced no political aspiration to recover it.

Across the English Channel in Britain, however, the Celtic fringes—despite their heavy economic dependence upon London—had undergone something of a national revival. In Wales this took mostly cultural form, with increased pressure for Welsh-language education and media. Only in the more mountainous and under-populated areas of north Wales did demands for full independence, as articulated by the nationalist party Plaid Cymru, actually find a sympathetic response. The urban south, with better transport links to England and well-established political connections to the national trade union movement and both the Liberal and Labour Parties, remained wary of the small-state nationalist ambitions of Walesfirsters.

As a result, although candidates from Plaid Cymru made an initial breakthrough in the national elections of 1974 and maintained a small but visible presence thereafter, they were never able to convince their compatriots of the nationalist case. Of the minority of Welsh voters who turned out in a March 1979 vote on devolution to regional assemblies, most were opposed. When devolution eventually came to Wales two decades later, it was not at the behest of local nationalists but as part of an administrative overhaul by the first New Labour government of Tony Blair—who calculated, shrewdly enough as it transpired, that the limited powers assigned to a new Welsh parliament in Cardiff would almost certainly fall into the hands of the same people who were now exercising it at Westminster.

The outcome—a Welsh Assembly with considerable symbolic value but little real power—appeared nevertheless to satisfy whatever demand there was in the principality for a separate national identity. Wales, after all, had been absorbed into and under England in 1536 during the reign of Henry VIII—himself scion of a Welsh dynasty—and while the recent revival of interest in its language and history was real enough, it should not be mistaken for a full-scale recovery of national consciousness. If there was anger or resentment under the surface of Welsh public life it derived from economic woes, not thwarted national aspirations. Offered the choice between an independent Wales and the recovery under English rule of the mining valleys and villages and ports devastated by de-industrialization and unemployment, very few Welshmen would have hesitated.

Scotland was another matter. There too the decline of the old industries had taken a terrible toll; but the Scottish National Party (SNP) which emerged in the Seventies could count on a share of the local vote four times that of their Welsh colleagues. Within two decades of its breakthrough as a ‘single-issue’ party at the 1974 elections—where it returned eleven members to parliament—the SNP had overtaken the Conservatives and was placing serious pressure upon traditional Labour strongholds. Unlike the Welsh, the voters of Scotland did favour devolution of power; and although they had to wait for it until 1997, the Scottish Parliament in Edinburgh indisputably speaks for a country which thinks of itself as a distinct and separate nation, if not quite a state.

Scottish nationalism benefited both from the fortuitous discovery of North Sea oil and gas—which brought prosperity to Aberdeen and the north-east—and from EC regional policies, which allowed Scottish administrators and businessmen to bypass London and forge direct links to Brussels. But Scotland, though joined to England by an Act of Union in 1707, had always been a land apart. Its sense of self rested less on linguistic or religious distinctions, which—though real enough—had grown tenuous for most of its residents, than on a curious admix of superiority andressentiment.

Thus, in the same way that so many of the classics of modern English literature are in fact Irish, so some of the greatest achievements of English-language political and social thought since the Enlightenment, from David Hume to Adam Smith and on to John Stuart Mill and beyond, were actually Scottish. Not only was Edinburgh in some ways the intellectual capital of early industrial Britain and Glasgow the radical core of the British labour movement in the early years of the twentieth century; but Scottish businessmen, Scottish managers—and Scottish émigrés—were responsible for establishing, settling and administering much of England’s empire. Moreover Scotland had always claimed and maintained a distinctive and separate identity: even at the height of centralized rule from London it preserved its own system of education and its own legal system.

An independent Scotland, then, was a perfectly plausible proposition—particularly in a European Union in which it would have been by no means the smallest or the poorest nation-state. Whether the majority of the Scottish population, having secured much of the appearance and some of the substance of independence, would ever wish to go further is less certain. The limitations of geography, demography and resources which have kept Scotland dependent upon the UK are still there; and by the end of the Nineties there seemed reason to suppose that in Scotland as elsewhere the engine of nationalism was running out of steam.

Whether the same was true amongst the descendants of the Scottish emigrants who had crossed into Ireland was less clear. The channel separating Scotland from Northern Ireland is less than fifty miles wide, but the gulf between the sensibilities of the two communities remains immense. Whereas Scottish nationalism derived above all else from a desire to resist and repulse the English, the national patriotism of Protestant Ulstermen consisted of a consuming determination to remain at all costs within the ‘Union’. The tragedy of the Irish ‘troubles’ lay in the opposed but otherwise identical objectives of the ultras of both sides: the Provisional IRA seeking to expel the British authorities from Ulster and reunite the province with an independent, Catholic Ireland; the Protestant Unionists and their paramilitary volunteers fixated upon suppressing the ‘Papists’ and retaining sine die the three-hundred-year-old bond with London (see Chapter 14).

If by the last years of the century both the Unionists and the Provisionals were finally forced into compromise, this was not for lack of determination on the part of extremists on both sides. But for the same reasons that the massacres in Bosnia and Kosovo brought about the intervention of outsiders, so the seemingly endless cycle of atrocity and counter-atrocity in Ulster not only undermined local sympathy for armed militants in the communities they claimed to represent, but forced London, Dublin and even Washington to intervene with more energy than they had mustered hitherto and press at least an interim agreement on the warring parties.

Whether the Good Friday Agreement, signed in April 1998, could resolve the national question in Ireland remained unclear. The interim solution on which both sides reluctantly concurred left much unresolved. Indeed, the terms of the accord brokered by the Prime Ministers of Ireland and the UK, with assistance from President Clinton—local self-government by an Assembly based in Ulster, with guarantees of representation for the Catholic minority, an end to the Protestant monopoly of police and other powers, confidence-building measures across the two communities and a standing Inter-Governmental Conference to oversee implementation—contained much that could have been imagined, with good will on all sides, twenty years earlier. But as an armistice in Ireland’s Hundred Years War the agreement seemed likely to hold for a while. Not for the first time in such matters, the ageing radicals at the head of the insurgency appeared to have been won over by the prospect of office.

Moreover the Republic of Ireland itself underwent an unprecedented socio-economic transformation in the course of the 1990s and now bore little discernable resemblance to the ‘Eire’ of nationalist imaginings. From the perspective of youthful Dublin, absorbed in its newfound role as a multi-cultural, low-tax outrider for post-national Euro-prosperity, the sectarian preoccupations of the Provisional IRA had come to be regarded in much the same way as the imperial, unionist obsessions of the Orange Order were seen in London: bizarre antiquarian relics of another age.

To anyone familiar with their earlier history, the new politics of sub-national particularism in the larger states of western Europe might appear simply as the reversion to type following the centralizing detour of the previous century. Even the outstanding contemporary European exception to this pattern actually illustrates the rule: Germany, the largest European state west of the former Soviet Union, did not experience a comparable separatist resurgence. This was not because of any peculiarities of its history but because post-Nazi Germany was already a truly federal republic.

Whether they were mapped directly on to ancient states (as in the case of Bavaria) or were newly conceived territorial combinations of once-independent principalities and republics (like Baden-Württemburg or NordRhein-Westfalen), the Länder of modern Germany exercised a considerable degree of financial and administrative autonomy in many of those aspects of government that impinge most directly upon people’s daily lives: education, culture, the environment, tourism and local public radio and television. To the limited extent that territorially -defined identity politics might have appealed to Germans—and here Germany’s distinctive past probably did play an inhibiting role—the Länder thus offered a serviceable surrogate.

Indeed it was not in western Europe’s largest country but instead in one of its smallest that the politics of national separatism took their most concentrated form. Belgium, a country the size of Wales with a population density exceeded only by the adjacent Netherlands, was the one West European state whose internal schisms bore some resemblance to contemporary developments in the post-Communist east. Its story may thus cast light on why, after the separatist wave of the late twentieth century had receded, the national states of Western Europe remained intact.

By the 1990s the towns and valleys of Wallonia were sunk into post-industrial decline. Coal mining, steel making, slate and metallurgical industries, textile production—the traditional cradle of Belgium’s industrial wealth—had virtually disappeared: Belgian coal production in 1998 was less than two million tons per year, down from twenty-one million tons in 1961. In what was once Europe’s most profitable industrial region there remained only the decrepit mills of the Meuse valleys above Liège and the gaunt, silent mining installations around Mons and Charleroi. Most of the former miners, steel-workers and their families in these communities now depended upon a welfare system administered from the country’s bi-lingual capital and paid for—as it seemed to Flemish nationalists—out of the taxes of gainfully employed northerners.

For Flanders had boomed. In 1947 over 20 percent of the Flemish workforce was still in agriculture; fifty years later fewer than 3 percent of Dutch-speaking Belgians derived their income from the land. In the decade from 1966 to 1975 the Flemish economy grew at the unprecedented rate of 5.3 percent per annum; even during the economic trough of the late Seventies and early Eighties it continued to grow, at a rate nearly twice that of Wallonia. Unencumbered by old industry or an unemployable workforce, towns like Antwerp and Ghent flourished with the growth of services, technology and commerce, aided by their location athwart Europe’s ‘golden banana’, running from Milan to the North Sea. There were now more Dutch speakers than French speakers in the country (by a proportion of three to two), and they produced and earned more per capita. The Belgian north had overtaken the south as the privileged, dominant region—a transformation accompanied by a crescendo of demands from the Flemish for political gains to match their newfound economic dominance.

Belgium, in short, combined all the ingredients of nationalist and separatist movements across Europe: an ancient territorial division347 reinforced by an equally venerable and seemingly insuperable linguistic gulf (whereas many residents of the Dutch-speaking regions have at least a passive acquaintance with French, most Walloons speak no Dutch) and underpinned by stark economic contrasts. And there was a further complication: for most of Belgium’s short history the impoverished communities of rural Flanders had been dominated by their urban, industrialized,

Belgium in 2005

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French-speaking Walloon compatriots. Flemish nationalism had been shaped by resentment at the obligation to use French, at the French-speakers’ apparent monopoly of power and influence, at the francophone élite’s arrogation to itself of all the levers of cultural and political authority.

Flemish nationalists, then, had traditionally taken for themselves a role comparable to that of Slovaks in pre-divorce Czechoslovakia—even to the extent of actively collaborating with the occupiers during World War Two in the forlorn hope of some crumbs of separatist autonomy from the Nazi table. But by the 1960s the economic roles had been reversed: Flanders was now presented by its nationalist politicians not in the image of backward, under-privileged Slovakia but rather as Slovenia (or—as they might prefer—Lombardy): a dynamic modern nation trapped in an anachronistic and dysfunctional state.

These two self-ascribed identities—repressed linguistic minority and frustrated economic dynamo—were now both woven into the fabric of Flemish separatist politics, such that even after the old injustices had been swept away and the Dutch-speaking provinces of the north had long since won the right to the use of their own language in public affairs, the remembered resentments and slights simply attached themselves to new concerns instead, bequeathing to Belgian public policy debates an intensity—and a venom—which the issues alone could never explain.

One of the crucial symbolic moments in the ‘language war’ came in the Sixties—fully half a century after Dutch had been officially approved for use in Flemish schools, courts and local government, and four decades after its use there was made mandatory—when Dutch-speaking students at the University of Leuven (Louvain) objected to the presence of French-speaking professors at a university situated within the Dutch-speaking province of Flanders-Brabant. Marching to the slogan of ‘Walen buiten!’ (‘Walloons Out!’) they succeeded in breaking apart the university, whose francophone members headed south into French-speaking Brabant-Wallon and established there the University of Louvain-la-Neuve (in due course the university library, too, was divided and its holdings redistributed, to mutual disadvantage).

The dramatic events at Leuven—a curiously parochial and chauvinist echo of contemporary student protests elsewhere—brought down a government and led directly to a series of constitutional revisions (seven in all) over the course of the ensuing thirty years. Although devised by moderate politicians as concessions to satisfy the demands of the separatists, the institutional re-arrangements of Belgium were always understood by the latter as mere stepping stones on the road to ultimate divorce. In the end neither side quite achieved its aims, but they did come close to dismantling the Belgian unitary state.

The outcome was byzantine in its complexity. Belgium was sub-divided into three ‘Regions’: Flanders, Wallonia, and ‘Brussels-Capital’, each with its own elected parliament (in addition to the national parliament). Then there were the three formally instituted ‘Communities’: the Dutch-speaking, the French-speaking, and the German-speaking (the latter representing the approximately 65,000 German speakers who live in eastern Wallonia near the German border). The communities, too, were assigned their own parliaments.

The regions and the linguistic communities don’t exactly correspond—there are German speakers in Wallonia and a number of French-speaking towns (or parts of towns) within Flanders. Special privileges, concessions, and protections were established for all of these, a continuing source of resentment on all sides. Two of the regions, Flanders and Wallonia, are effectively unilingual, with the exceptions noted. Brussels was pronounced officially bilingual, even though at least 85 percent of the population speaks French.

In addition to the regional and linguistic Communities, Belgium was also divided into ten provinces (five each in Flanders and Wallonia). These, too, were assigned administrative and governing functions. But in the course of the various constitutional revisions real authority came increasingly to lie either with the region (in matters of urbanism, environment, the economy, public works, transport and external commerce) or the linguistic community (education, language, culture and some social services).

The outcome of all these changes was comically cumbersome. Linguistic correctness (and the constitution) now required, for example, that all national governments, whatever their political color, be ‘balanced’ between Dutch- and French-speaking ministers, with the prime minister the only one who has to be bilingual (and who is therefore typically from Flanders). Linguistic equality on the Cour d’Arbitrage (Constitutional Court) was similarly mandated, with the presidency alternating annually across the language barrier. In Brussels, the four members of the executive of the capital region would henceforth sit together (and speak in the language of their choice) to decide matters of common concern; but for Flemish or Francophone ‘community’ affairs they would sit separately, two by two.

As a consequence Belgium was no longer one, or even two, states but an uneven quilt of overlapping and duplicating authorities. To form a government was difficult: it required multi-party deals within and across regions, ‘symmetry’ between national, regional, community, provincial, and local party coalitions, a working majority in both major language groups, and linguistic parity at every political and administrative level. And when a government was formed it had little initiative: even foreign policy—in theory one of the last remaining responsibilities of the national government—was effectively in the hands of the regions, since for contemporary Belgium it mostly means foreign trade agreements and these are a regional prerogative.

The politics of this constitutional upheaval were just as convoluted as the institutional reforms themselves. On the Flemish side, extreme nationalist and separatist parties emerged to press for the changes and benefit from the new opportunities to which they gave rise. When the Vlaams Blok, spiritual heir to the wartime ultra-nationalists, rose to become the leading party in Antwerp and some Dutch-speaking suburbs north of Brussels, the more traditional Dutch-speaking parties felt obliged to adopt more sectarian positions in order to compete.

Similarly, in Wallonia and Brussels, politicians from the French-speaking mainstream parties adopted a harder ‘communitarian’ line, the better to accommodate Walloon voters who resented Flemish domination of the political agenda. As a result, all the mainstream parties were eventually forced to split along linguistic and community lines: in Belgium the Christian Democrats (since 1968), the Liberals (since 1972), and the Socialists (since 1978) all exist in duplicate, with one party of each type for each linguistic community. The inevitable result was a further deepening of the rift between the communities, as politicians now addressed only their own ‘kind’.348

A high price was thus paid to mollify the linguistic and regional separatists. In the first place, there was an economic cost. It was not by chance that by the end of the twentieth century Belgium had the highest ratio of public debt to gross domestic product in Western Europe—it is expensive to duplicate every service, every loan, every grant, every sign. The established practice of using public money (including EU regional grants) on a proportional basis to reward clients of the various community ‘pillars’ was now applied to the politics of the language community: ministers, state secretaries, their staffs, their budgets and their friends are universal, but only in Belgium does each come attached to a linguistic doppelganger.

By the end of the century ‘Belgium’ had taken on a decidedly pro forma quality. Entering the country by road, a traveler could be forgiven for overlooking the rather apologetic signpost inscribed with a diminutive ‘België’ or ‘Belgique’. But visitors could hardly miss the colorful placard informing them of the province (Liège, say, or West-Vlaanderen) that they had just entered, much less the information board (in Dutch or French but not both) indicating that they were in Flanders or Wallonia. It is as though the conventional arrangements had been handily inverted: the country’s international borders were a mere formality, but its internal frontiers were imposing and very real. Why, then, did Belgium not simply come apart?

There are three factors that help account for Belgium’s improbable survival, and more broadly for the persistence of all the states of Western Europe. In the first place, with the passing of generations and the implementation of constitutional reforms, the separatist case lost its urgency. The old communitarian ‘pillars’—hierarchically organized social and political networks that substituted for the nation-state—were already in decline. A younger generation of Belgians was provingfar less susceptible to appeals based on sectarian affinity even if older politicians were slow to appreciate the fact.

The decline in religious practice, the accessibility of higher education, and the move from countryside to town loosened the grip of the traditional parties. For obvious reasons this was especially true of the ‘new’ Belgians: the hundreds of thousands of second- and third-generation immigrants from Italy, Yugoslavia, Turkey, Morocco or Algeria. Like the new Basques, these people have pressing concerns of their own and little interest in the dusty agendas of ageing separatists. Opinion polls through the Nineties indicated that most people, even in Flanders, no longer put regional or language issues at the head of their concerns.

Secondly, Belgium was rich. The obvious difference between Belgium and other, less fortunate parts of Europe where nationalists were able successfully to exploit communal sensibilities is that for the vast majority of residents of modern Belgium life was both tranquil and materially sufficient. The country is at peace—if not with itself then at least with everyone else—and the same prosperity that underwrote the ‘Flemish miracle’ also attenuated the politics of linguistic resentment. This observation applies with equal force to Catalonia or even to parts of Scotland, where the more extreme exponents of the case for national independence saw their arguments steadily defanged by the demobilizing effects of unaccustomed affluence.

The third reason for the survival of Belgium—and of Western Europe’s other internally fragmented nation-states—has less to do with economics than with geography, though the two are closely related. If Flanders—or Scotland—could in the end remain comfortably part of Belgium or the UK it was not because they lacked the intensity of national sentiment that appeared to have re-surfaced in former Communist lands. Quite the contrary: the desire for self-rule was palpably stronger in Catalonia, say, than in Bohemia; and the gulf separating Flamands from Walloons was far wider than that between Czechs and Slovaks or even Serbs and Croats. What made the difference was the fact that the states of Western Europe were no longer free-standing national units with a monopoly of authority over their subjects. They were also and increasingly part of something else as well.

The formal mechanism for a move towards full European Union was set out in the Single European Act (SEA) of 1987; but what really drove the process forward was the end of the Cold War. The SEA had committed the twelve members of the Community to achieving by 1992 the full and free circulation of goods, services, capital and people—hardly a breakthrough, since these same objectives were already envisaged in principle decades before. It was the Maastricht Treaty of that year, and its successor Treaty of Amsterdam five years later, that propelled the Union’s members into a truly novel set of institutional and financial arrangements, and these were the direct outcome of radically changed external circumstances.

From Community to Union: The EU 1957-2003

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At Maastricht, it was the much-publicized agreement to establish a common European currency that caught public attention. The French, to overcome their anxiety at German unification, bound the Federal Republic firmly into the ‘West’ by getting Bonn to agree to abandon the Deutschmarkfor a single European currency unit—the euro—and by committing the enlarged German state to operating within the constraints of a European Union bound by an ever-denser mesh of laws, rules and agreements Bonn, in return, insisted that the new currency be a carbon copy of the oldDeutschmark, regulated—like the German currency—by an autonomous board of central bankers and committed to the fiscal principles of the German central bank: low inflation, tight money, and minimal deficits. The German negotiators—wary of the profligate tendencies of ‘Club Med’ countries like Italy or Spain—imposed draconian conditions for membership of the new currency, with the European Commission authorized to impose fines upon reprobate governments.

At Bonn’s behest, Europe’s finance ministers would thus be bound, Ulysses-like, to the euro-mast: unable to respond to the Siren-calls of voters and politicians for easier money and increased public spending. These terms, designed to insure that the new euro would be as inflation-proof as theDeutschmark itself, were not universally popular—in the poorer member states it was widely and rightly feared that they would constrain public policy and perhaps even prevent growth. And so, in order to make the Maastricht conditions more palatable, cash bonuses were made available to recalcitrant governments: Jacques Delors, the Commission President, all but bribed the finance ministers of Greece, Spain, Portugal and Ireland, promising large increases in EU structural funds in return for their signatures on the Treaty.

The UK and Denmark, meanwhile, signed the main body of the Treaty but opted out of the proposed common currency—partly in anticipation of its economically restrictive impact; partly because of its symbolic resonance in nations already more reluctant than most to abandon the trappings of sovereignty to transnational agencies; and in the case of the UK because—as so often in the past—the march to Union was regarded with acute misgivings as a further step towards a European super state.349

To be sure, the Maastricht Treaty made much play with ‘subsidiarity’—a sort of Occam’s Razor for eurocrats, stating that ‘the Union does not take action (except in the areas which fall within its exclusive competence) unless it is more effective than action taken at national, regional or local level’. But even this had different meanings for different ears: in France it meant limiting the power of supernational bodies beyond Paris’s control; for the Germans, it implied special privileges and powers for regional governments; for the British it represented a device for blocking institutional integration.

Maastricht had three significant side-effects. One of them was the unforeseen boost it gave to NATO. Under the restrictive terms of the Treaty it was clear (as the French at least had intended) that the newly liberated countries of eastern Europe could not possibly join the European Union in the immediate future—neither their fragile legal and financial institutions nor their convalescent economies were remotely capable of operating under the strict fiscal and other regulations the Union’s members had now imposed upon all present and future signatories.

Instead, it was suggested in the corridors of Brussels that Poland, Hungary and their neighbours might be offered early membership of NATO as a sort of compensation: an interim prize. The symbolic value of extending NATO in this way was obviously considerable, which is why it was immediately welcomed in the new candidate member-states. The practical benefits were less obvious (unlike the damage to relations with Moscow which was real and immediate). But because Washington had reasons of its own for favouring the expansion of the North Atlantic Defense community, a first group of central European nations was duly admitted to NATO a few years later.350

The second impact was on European public awareness. The Maastricht Treaty provoked an unprecedented level of interest in what had hitherto been the obscure workings of the European Union and its anonymous bureaucracy. Even though the Treaty was approved in every country where it was put to a national vote (albeit by just 50.1 percent in the French case) it aroused sufficient opposition to place the question of ‘Europe’ on domestic political agendas, often for the first time. For four decades, the institutions and rules of a new continental system had been quietly designed and decided in obscure Benelux towns with no reference to public wishes or democratic procedure. Those days, it appeared, were over.

The third consequence of Maastricht was that it cleared the way for the coming together not, indeed, of Europe, but at least of its western half. The end of the Cold War, and the EU’s commitment to a single market, removed the impediments to membership for the remaining members of the old European Free Trade Area.351 Sweden, Finland and Austria all duly applied, no longer constrained by their commitment to neutrality (or, in the Finnish case, by the need to maintain good relations with Moscow) and increasingly nervous at being left out of the common European space.

The accession negotiations with the new applicants were completed in just three months, facilitated by the fact that all three countries were not only stable and small—their combined population less than one quarter that of Germany—but also decidedly rich. The same would have been true of the last remaining hold-outs, Norway and Switzerland. But despite considerable enthusiasm on the part of local business leaders the populations of both countries voted against membership—fearful of losing their autonomy and initiative in a supranational federation and skeptical of the benefits of participation in the new currency.

A comparable skepticism marked the closeness of the vote in Sweden in November 1994, when EU membership was put to a referendum. Just 52.3 percent voted in favour, and even then only on the understanding that their country would stay out of the common currency (ten years later, when the government in Stockholm recommended to the nation that they finally abandon the krone and join the euro, it was decisively and humiliatingly defeated in a referendum, just as the Danish government had been in September 2000 when it posed the same question). The reaction of Per Gahrton, Swedish Riksdag member for the Green Party and a bitter opponent of EU membership, echoed a widespread Scandinavian anxiety: ‘This is the day that the Riksdag decided to transform Sweden from an independent nation to a sort of province within an expanding superpower, in the process converting itself from a legislative body to little more than an advisory panel’.

Gahrton’s feelings were shared by many northern Europeans, including some who nonetheless voted in favour of membership. Even those in the Swiss or Scandinavian political and business elites who wanted to join the EU, so as not to miss out on the benefits of the single market, recognized that there were economic and political costs to that option: in private they conceded that if the decision went against them it would not be an unmitigated disaster for their countries. In Sweden—or Norway, or even Denmark and the UK—the EU (not to speak of its newly integrated currency) was seen as a choice, not a necessity.

In Central and Eastern Europe however, membership of ‘Europe’ was the only possible option. Whatever their reasoning—whether it was to modernize their economies, secure new markets, obtain foreign aid, stabilize their domestic politics, lock themselves into ‘the West’ or simply head off the temptation of a retreat into national Communism—the new rulers from Tallinn to Tirana looked to Brussels. The prospect of joining the EU, with its promise of affluence and security, was dangled temptingly before the liberated electorates of post-Communist Europe. Don’t be seduced by those who tell you it was better under the old system, they were warned. The pain of transition will have been worth it: Europe is your future.352

Seen from Brussels, however, the picture was quite different. From the outset the European project was deeply schizophrenic. On the one hand it was culturally inclusive,open to all the peoples of Europe. Participation in the European Economic Community, the European Community and finally the European Union itself was the right of any European state ‘whose system of government is founded on the principles of democracy’ and which agreed to accept the terms of membership.

But on the other hand the Union was functionally exclusive. Each new agreement and treaty had further complicated the requirements placed upon member-states in return for binding them into the ‘European’ family; and these regulations and rules had the cumulative result of building ever-higher fences to keep out countries and peoples who could not meet the tests. Thus the Schengen Treaty (1985) was a boon for the citizens of participating states, who now moved unhindered across open borders between sovereign states. But residents of countries outside the Schengen club were obliged to queue—quite literally—for admission.

Maastricht, with its rigid requirements for a common currency and its insistence that all aspiring member-states integrate into their systems of governance the acquis communautaire, the rapidly burgeoning code of European practices, was the ultimate bureaucratic exclusion zone. It posed no impediment to Nordic applicants or Austria, but presented an awesome hurdle for would-be candidates from the East. Committed by the terms of its own charter to welcoming the new Europeans into its fold, the EU in practice sought to keep them out as long as possible.

There were good reasons for this. Even the wealthiest of the new hopefuls—Slovenia, say, or the Czech Republic—were distinctly poorer than any existing EU member, and most of them were very poor indeed. By any measure the gulf separating East and West Europe was huge: infant mortality in the Baltic states was twice the average of the fifteen EU member states in 1996. The life expectancy of males in Hungary was eight years short of the EU average; in Latvia, eleven years.

If Hungary, or Slovakia or Lithuania—much less Poland, with its 38 million inhabitants—were admitted to the Union on the same terms as its present members the cost in subsidies, regional assistance, infrastructure grants and other transfers would surely break the EU budget. In December 1994 the Bertelsmann Foundation in Germany published a study suggesting that if the six countries of Central Europe then seeking entry (Poland, Hungary, Slovakia, the Czech Republic, Romania and Bulgaria) were admitted on the same terms as existing members, the cost in structural funds alone would exceed thirty billion Deutschmarks a year.

This, it was widely feared, could provoke a backlash in the electorates of the countries paying most of the Union’s bills and who would surely have to be asked to contribute even more: the Netherlands and Britain but especially, and more ominously, Germany. In any case, the recipient countries in the East were in no position to put up even the minimum matching funds required under existing EU regulations. What post-Communist Europe really needed was a Marshall Plan, but no-one was offering it.

In addition to being expensive, the new recruits would be troublesome. Their legal systems were corrupt or dysfunctional, their political leaders untested, their currencies unstable, their borders porous. Their needy and indigent citizens, it was feared, would either head West in search of welfare and work or else stay home and accept derisory wages—tempting foreign investors and employers away from the old countries of the EU. Either way they would constitute a threat. There was talk of western Europe being ‘overrun’—a distant but unmistakable echo of Herder’s fears of the rumbling of the ‘wild peoples’ of eastern Europe. No one doubted that the EU could do wonders for eastern Europe. But what might eastern Europe do to the EU?

With these concerns in mind, the western Europeans duly procrastinated. In the immediate aftermath of 1989 the German Foreign Minister Hans-Dietrich Genscher initially proposed that the European Union absorb all the countries of Eastern Europe as soon as possible, as a prophylactic measure against a nationalist backlash. But he was soon brought to heel; and although Margaret Thatcher continued to press enthusiastically for early enlargement (calculating that an enlarged Union would inevitably be diluted into the pan-European free trade area of British dreams) it was the French approach that came to dominate EU strategy.

François Mitterrand’s first response had been to propose a loose-knit ‘European Confederation’—a sort of outer tier of associate membership, open to all-comers with no conditions and few material benefits. In later years French diplomats would bemoan the lack of support for this suggestion, regretting the lost opportunity for ‘calm collaboration’ towards an enlarged Union. But at the time it was rightly seen as a transparent ploy, to corral the newly liberated Eastern European states into an ersatz ‘European community’ that would justify keeping them out of the real thing indefinitely. Václav Havel understood this from the start, which is why he rejected it out of hand (and became for a while persona non grata at the Elysée Palace).

Instead, relations between eastern and western Europe remained for the next few years stuck at the level of bilateral exchanges and trade accords, with certain countries—Hungary, Poland, the Czech Republic and Slovakia—accorded a strictly limited ‘associational’ status vis-à-vis the EU but nothing more. However, the Moscow coup of 1991 and the Balkan wars that broke out shortly afterwards focused Western attention on the risks of letting the post-Communist countries fester in uncertainty; and it was duly agreed at an EU summit meeting in Copenhagen in June 1993 that in principle—and at a date yet to be determined—‘the associated countries in Central and eastern Europe that so desire shall become members of the European Union’.

This did little to alleviate the frustration of the would-be members whose dealings with Brussels and the Western capitals had left them, in the understated words of the Polish Prime Minister Hanna Suchocka, ‘disappointed’. And indeed the political leaders of Eastern Europe spent much of the rest of the decade patiently and frustratingly seeking firm commitments from their reluctant Western partners, promising their domestic constituents that EU membership really was on the agenda while taking every opportunity to impress upon their foreign interlocutors the urgency of making it so.

But Western attention was elsewhere. The transition to a new common currency and the translation into practice of the Maastricht plans for institutional integration were the dominant preoccupation in every Western European capital. In Germany there was growing anxiety at the costs and difficulties of integrating the territories of the former GDR. Meanwhile the Yugoslav catastrophe—which at first had served to remind Western statesmen of the risks of underestimating post-Communist problems in general—had now become a full-time obsession.

The gaze of prominent intellectuals—a sure barometer of passing political fashions—had moved away. It was only a few years since ‘Central Europe’ had been rediscovered by Western commentators, with Havel, Kundera, Michnik and their colleagues the toast of editorial pages and higher-brow periodicals from Paris to New York. But history was passing swiftly on: Prague and Budapest, their miraculous transition out of tyranny already a fading memory, had been left to tourists and businessmen. Bernard-Henri Lévy and Susan Sontag were more likely to be found in Sarajevo. Central Europe’s fifteen minutes of fame had passed and with it any public pressure to expedite its absorption into Western institutions. In public, politicians and managers in Brussels insisted upon their continued desire to see the Union enlarged to its East when conditions were ‘ripe’. Off the record they were more candid. As one very senior European Commission official observed in the mid-Nineties, ‘no-one here is serious about enlargement’.

Enlargement, nevertheless, was on the agenda. Under the EU’s own rules it could not deny countries the right to apply for membership. The European Commission was accordingly constrained to accept applications from Hungary and Poland in 1994, Romania, Slovakia, Latvia, Estonia, Lithuania and Bulgaria in 1995, and Slovenia and the Czech Republic in 1996. The ten former Communist candidates thus joined Malta and Cyprus, both of whom had submitted applications in 1989, and Turkey (whose application had been languishing since 1987). All of these candidate countries were now parked in a rather crowded ante-room, awaiting the Union’s attention.

In 1997 the Treaty of Amsterdam added a series of important technical amendments to the original Rome Treaty, filling out the goals of Maastricht and putting teeth into the Union’s stated intention to develop a program of European citizenship and Europe-wide institutions to address employment, health, the environment and the glaring absence of a common foreign policy. At this point, with the common currency scheduled to come into effect in 1999, the Union had completed a decade of internal integration that had absorbed all its bureaucratic energies. There was no longer any excuse for postponing the far thornier issue of expansion.

The preference of some national leaders, and many of the senior officials at the European Commission, would have been to limit accession negotiations to the ‘easy’ cases: small countries like Slovenia or Hungary, contiguous to the Union’s existing borders and with relatively modernized economies, which posed only a limited challenge to the EU’s institutional framework and its budget. But it soon became clear that this might be politically imprudent—left out in the cold Romania, or Poland, could drift into dangerously undemocratic waters—and so, beginning in 1998, the European Union officially initiated the accession process of all ten eastern European applicants together with Cyprus. Malta was added to the list shortly afterwards. Turkey, however, was held back.

From this point the enlargement took on a dynamic of its own, notwithstanding continuing misgivings on the part of a number of existing EU members and, to judge from opinion polls, widespread lack of enthusiasm among their populations. Bilateral accession negotiations were set in motion, first with a presumptive inner core of candidates: Cyprus, the Czech Republic, Estonia, Hungary, Poland and Slovenia; and then, a year later, with the rest: Bulgaria, Romania, Slovakia, Latvia, Lithuania and Malta. Poland’s presence in the first group, in spite of the economic difficulties it posed, was explained by its size and prominence. Slovakia, conversely, was ‘relegated’ to the second tier in response to the stagnation and corruption wrought there by Mečiar’s authoritarian rule—and as a warning and example to others.

There followed five years of intense and sometimes acrimonious negotiations. ‘Brussels’ descended upon the capitals of all the candidate countries, showering them with advisors, recommendations, examples, programmes and instructions in an effort to bring their institutions, laws, regulations, practices and civil services up to a minimum standard compatible with those of the Union. The applicants, in turn, pressed as hard as they dared for assurances that they would have free access to EU consumers, while defending their domestic market from being overwhelmed by more attractive and efficient goods and services from the West.

The struggle was decidedly unequal. Whereas the EU was the longstanding and openly avowed object of Eastern desires, the putative new members could offer little in return except the promise of good behaviour. And thus it was agreed that while the new members would be accorded a few limited concessions—among them temporary restraints upon foreign purchases of land, a sensitive political issue—they would have to accept that the EU, despite its commitment to a single market, was going to impose considerable restrictions upon their own export of goods and, especially, people.

In response to wildly exaggerated estimates of likely population flows (one European Commission report published in 2000 prophesied an annual exodus of 335,000 from the ten eastern accession states if the frontiers were opened without restriction), most of the Western member-states insisted on quotas being placed on the number of eastern Europeans who could move to the West—in blatant disregard of the spirit and indeed the letter of a decade of proclamations and treaties. Germany, Austria and Finland imposed strict limits for two years with an option to extend these for a further five. Belgium, Italy and Greece followed suit. Only the UK and Ireland declared their willingness to conform to the ‘open door’ principles of the Union—while announcing that welfare benefits for work-seekers from Eastern Europe would be kept to a minimum.

The eastward extension of agricultural subsidies and other benefits was also placed within strict limits. In part, as the Commission’s Transition Report 2003 put it, this was because of ‘questions about the accession countries’ capacities to absorb and use efficiently the post-accession grants from the EU’s cohesion and structural funds’. But the main reason was simply to hold down the cost of enlargement and minimize competition for Western producers. Not until 2013 would East European farmers get the same subsidies as those already being paid out in the West—by which time, it was hoped, most of them would have retired or gone out of business.

By the time the negotiations were complete, the terms agreed and the 97,000 pages of the Union’s acquis communautaire duly incorporated into the governing codes of the applicant states, the actual enlargement itself came as something of an anti-climax. Having waited fifteen years to join, most of the new states could be forgiven for lacking the enthusiasm they might have exhibited a decade earlier. In any case, many of the practical benefits of Western engagement had already been discounted—notably in car manufacturing, where former Communist states had a ready supply of cheap, skilled labour and in which companies like Volkswagen, Renault and Peugeot-Citroën invested heavily during the Nineties. Between 1989 and 2003 the cumulative total of foreign direct investment for Eastern Europe as a whole had reached $117 billion.

By the early twenty-first century, foreign investment in former Communist Europe was actually tailing off. Ironically, this was largely a result of the coming EU enlargement. Once they were inside the Union it would certainly be easier to do business in and with countries like Poland or Estonia. And they in turn would be able to sell more to the West: Poland expected to double its food exports to the EU within three years of joining. But these were the fruits of relative backwardness. Once they were inside the EU, wages and other costs in the countries of Eastern Europe would begin to rise to Western levels. The region’s cost advantage over factories in India, or Mexico, would be lost. Profit margins—at least in the manufacturing sector—would start to fall.

Meanwhile, thanks to the heavy cost of unraveling the Communist economies, East Europe on the eve of accession remained far behind the countries of the EU. Per capita GDP even in the most prosperous new member states was far below their Western neighbours: in Slovenia it stood at 69 percent of the EU average, in the Czech Republic at 59 percent, in Hungary 54 percent. In Poland it was just 41 percent, in Latvia, the poorest new member, 33 percent. Even if the economies of the new EU states kept growing on average 2 percent faster than those of the existing members353, it would take Slovenia twenty-one years to catch up with France. For Lithuania the time lag would be fifty-seven years. The citizens of former-Communist states had no access to such data, of course. But most had few illusions about the difficulties ahead. When Czechs were asked, in a series of opinion polls in 2000, how long they thought it would be before their situation ‘improved’, 30 percent of respondents answered ‘within five years’; 30 percent answered ‘in ten years’; 30 percent answered ‘fifteen years or more’; and 10 percent said ‘never’.

Nonetheless, for all the justified skepticism of the beneficiaries, the formal implications of the EU’s ‘big-bang’ enlargement were real enough. When the accession treaty, signed in Athens in April 2003, came into force on May 1st 2004, the European Union grew at a single stroke from fifteen to twenty-five members (Bulgaria and Romania were held back, their accession anticipated for 2007). Its population increased by one-fifth (though its economy was expanded by less than 5 percent); its land mass by almost as much. And the frontiers of ‘Europe’, which as recently as 1989 had reached no further east than Trieste, now extended into what had once been the USSR.

At the dawn of the twenty-first century the European Union faced a daunting range of problems: some old, some new and some of its own making. Its economic troubles were perhaps the most familiar and in the end the least serious of its concerns. With or without the new member states the EU continued to spend—as it had done from the outset—hugely disproportionate sums of money on its farmers. Forty percent of the Union’s budget—or $52 billion in 2004—went on politically motivated ‘farm support payments’, many of them to large mechanized agri-businesses in France or Spain that hardly needed the help.

Even after agreement had been reached to reduce these subsidies and cut the Common Agricultural Program it was anticipated that farm price supports would still constitute over a third of the EU’s total expenditure well into the second decade of the new century, placing an intolerable burden upon the budget. The problem was not that the Union was poor. Quite the contrary: the collective wealth and resources of its members were comparable to those of the US. But its budget, in the words of an independent report commissioned by Brussels in 2003, was a ‘historical relic’.

The European Union had started out, half a century before, as a customs union—a ‘common market’—bound together by not much more than a common external tariff. Its pattern of expenditure was driven and then constrained by negotiated

An Ever-Expanding Union? The EU in 2004

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agreements on tariffs, prices, subsidies and supports. Over the years its ambitions had expanded into the realms of culture, law, government and politics and it had taken on—in Brussels and elsewhere—many of the external trappings of a conventional government.

But whereas conventional governments are free to raise money to meet their anticipated costs, the European Union had and has very few revenue-raising capacities of its own. Its income derives from fixed rates of customs duty, agricultural levies, a Union-wide indirect sales tax (VAT) and, above all, contributions from member-states capped at just 1.24 percent of Gross National Income (GNI). Thus very little of the EU’s income is under the direct control of the Union’s own administration—and all of it is vulnerable to political pressures within the separate member-states.

Most of the latter are recipients of EU largesse rather than contributors to its budget. In 2004, following its enlargement to the East, nineteen of the Union’s member countries received from Brussels more than they paid in. The cost of running the Union was in practice met by net contributions from just six member states: the UK, France, Sweden, Austria, the Netherlands and Germany. Ominously for the Union’s future prospects, all six countries petitioned the Commission in December 2003 to have national contributions to the EU budget reduced in future from 1.24 percent of GNI to just 1 percent.

The Union’s budget, tiny in comparison to that of even the smallest member-state and mostly spent on structural funds, price supports and the EU’s own costly administration, is thus a permanent hostage to the interests of its contributors and recipients alike. The levers of the Union’s economic machinery depend for their efficiency upon the consent of all its constituent parts. Where everyone more or less concurs on the principle and benefits of a given policy—on open internal borders, or unrestricted markets for goods and services—the EU has made remarkable progress. Where there is real dissent from a handful of members (or even just one, particularly if it is a major contributor), policy stalls: tax harmonization, like the reduction of agricultural supports, has been on the agenda for decades.

And sometimes the clock runs backwards. After two decades of Brussels-driven efforts to eliminate state subsidies for favoured national ‘champions’ and thereby secure a level playing field in intra-European economic competition, the EU’s single market commissioner (the Dutchman Frits Bolkestein) expressed his surprise in July 2004 at watching France and Germany revert to the ‘protectionist’ policies of the Seventies in defense of threatened local firms. But then both Berlin and Paris, unlike the unelected commissioners in Brussels, have tax-paying voters whom they simply cannot ignore.

These paradoxes of union are nicely captured in the tribulations of the euro. The problem with a common currency lay not in the technical substitution of a single unit of reference for a multitude of national currencies—this process was already under way long before the abolition of the franc or the lira or the drachma and turned out to be surprisingly smooth and painless354—but in the prerequisite harmonization of national economic policies. To avoid the moral hazard and practical risks of free riders, Bonn, as we have seen, had insisted upon what became known as the ‘growth and stability pact’.

Countries wishing to join the euro were obliged to hold their public debt down to no more than 60 percent of Gross Domestic Product, and were expected to run budget deficits of no more than 3 percent of same. Any country that failed these tests would be subject to sanctions, including substantial fines, imposed by the Union. The point of these measures was to ensure that no euro-zone government would let down its fiscal guard, overrun its budget at will and thus place unfair strains on the economies of other euro-zone members who would have to bear the burden of ensuring the stability of the common currency.

To everyone’s surprise the traditionally spendthrift southern tier proved surprisingly disciplined. Spain ‘qualified’ for euro membership by what one Spanish observer tartly described as a combination of fortuna and virtu: an upswing in the economy allowed the government to pay down the country’s public debt just in time for the 1999 introduction of the currency. Even Italy managed to pass the Teutonic tests (which many Italians rightly suspected had been set up to keep them out), albeit with more than a little juggling of figures and the one-time sale of public assets. By 2003 the euro-zone encompassed twelve countries, ranging from Ireland to Greece.

But—as many skeptics had predicted—the strains of a ‘one size fits all’ currency soon began to tell. The newly established European Central Bank (ECB) in Frankfurt maintained from the outset a relatively high interest rate, to support the new currency and secure it against inflation. But the economies of the euro-zone states differed with respect both to their level of development and their point in the economic cycle. Some, like Ireland, were booming; others—notably Portugal—lagged far behind and could have used the boost to domestic activity as well as exports that would traditionally have been achieved by lowering interest rates and ‘softening’ the currency.

Shorn of the power to implement such measures, the government of Portugal was obliged by the terms of the ‘pact’ to reduce government expenditure—or else face substantial fines—just when it ought, in conventional economic theory, to have been spending its way out of recession. This did not make for domestic popularity; but at least the country could boast that it had not reneged on the terms of its participation in the new currency: by 2003 Lisbon had successfully reduced government debt to 59.4 percent of GDP and the annual deficit to 2.8 percent, squeezing under the official limits.

The next year, however, France ran a deficit of nearly 4.1 percent—and Germany, its ageing economy finally paying the price for unification, followed suit with a deficit of 3.9 percent and a debt ratio of nearly 65 percent. Given the size of their respective economies, the fact that neither France nor Germany was adhering to its own rules represented a significant challenge to the whole agreement. But this time, when the Commission set in motion the penalty proceedings, Paris and Berlin made it clear that they regarded the ‘temporary’ deficits as economically unavoidable and had no intention of paying fines or even committing themselves to doing significantly better the following year.

The Union’s smaller states—both those like Greece or Portugal which had striven mightily and at some cost to meet the pact’s terms and those such as the Netherlands and Luxembourg which feared for the stability of what was now their currency too—duly cried foul, but the lesson was clear. Within less than a decade of its appearance, the growth and stability pact was dead. Just how much the euro would actually suffer if the participating countries were allowed more flexibility in their domestic budgets was by no means clear. There were many who felt that the real problem lay not with national governments but rather with the rigid and seemingly unresponsive Central Bank, immovably insistent upon its complete independence and still fighting the anti-inflationary battles of the 1970s.

The difficulties of the euro pointed to a broader shortcoming in the European project: its extraordinarily unwieldy system of government. The problem lay in the original conception. Jean Monnet and his heirs had deliberately eschewed any effort to imagine, much less implement, a democratic or federal system. Instead they had driven forward a project for the modernization of Europe from above: a strategy for productivity, efficiency and economic growth conceived on Saint-Simonian lines, managed by experts and officials and with scant attention paid to the wishes of its beneficiaries. The energies of its proponents and exponents were largely devoted to the complex technical dimensions of ‘building Europe’. To the extent that other concerns ever arose, they were serially postponed.

By the 1990s, then, the European Union was still run along lines that had been laid down decades before and mostly for managerial convenience. The unelected Commission in Brussels administered a substantial bureaucracy, initiating policies and implementing agendas and decisions subject to the approval of a Council of Ministers from the member-states. An unwieldy European Parliament, sitting variously in Strasbourg and Brussels and directly elected since 1979, exercised a slowly expanding oversight role (in the original Rome Treaty its function had been strictly consultative) but no power of initiative.

Uncontentious decisions were typically made in Brussels by experts and civil servants. Policies likely to affect significant electoral constituencies or national interests were hammered out in the Council of Ministers and produced complicated compromises or else expensive deals. Whatever could not be resolved or agreed was simply left in abeyance. The dominant member states—Britain, Germany and above all France—could not always count on getting what they wanted; but whatever they truly did not want did not come to pass.

This was a unique set of arrangements. It bore no relation to the condition of the separate states of North America in 1776, all of which had emerged as satellites of a single country—Britain—whose language, culture and legal system they shared. Nor was it really comparable to the Swiss Confederation, although that analogy was occasionally suggested: in their centuries-old web of overlapping sovereignties, administrative enclaves and local rights and privileges the cantons of Switzerland more closely resemble old-regime France without the king.355

The member-states of the European Union, by contrast, remained completely independent and separate units in a voluntary association to which they had, over time, conceded a randomly accumulated set of powers and initiatives without ever saying what principle lay behind the arrangement and how far this common undertaking was to go. ‘Brussels’—an appropriately anonymous headquarters for an undefined administrative entity, neither democratic nor authoritarian—governed only through the consent of its member governments. From the outset it had presented itself to all of these as a straightforwardly positive-sum undertaking: the Community/Union would contribute to its members’ well-being without subtracting anything of significance from their independence. But this could not continue indefinitely.

What brought matters to a head was not the inherently complicated and incremental nature of the Union’s system of rule, but the impossibility of maintaining it with twenty-five members. Hitherto the chairmanship of the Council of Ministers rotated every six months, with each country getting to host a self-promoting bi-annual European conference—a system already much disliked by the Union’s full-time administrators. The prospect of such a circus shambling around through twenty-five different capitals, from Lisbon to Ljubljana, was plainly absurd. Moreover, a decision-taking system designed for six member-states and already cumbersome for twelve, much less fifteen, would simply grind to a halt with fifty European Commissioners (two from each country), or a European Council representing twenty-five member-states—each with a power of veto.

The likely difficulties were all too well foreshadowed at a meeting in Nice in December 2000. Ostensibly called to lay the groundwork for enlargement and to devise a new voting system in the EU Council of Ministers—one that would weight member-states’ votes by population while still ensuring that majority decisions could be reached—the conference ended in acrimonious and deeply embarrassing horse trading. The French insisted on maintaining parity with Germany (despite a population disparity of twenty million people) while countries like Spain and Poland, the latter accorded observer status at the meeting, sought to maximize their own future voting strength in the Council by selling their backing to the highest bidder.

The unseemly scramble for influence at Nice, as leading European statesmen like Tony Blair, Jacques Chirac and Gerhard Schroeder spent sleepless nights bargaining and bickering for status and influence in their common European home, illustrated the price that was now being paid for previous neglect of constitutional niceties. By bringing the Union to a new low, Nice led directly to the establishment of a ‘European Convention’: a sort of unelected constituent assembly authorized to produce a practical system of governance for an enlarged ‘Europe’ and, it was hoped, some credible account of the purposes of the whole thing. Following a certain amount of (by now familiar) lobbying from Paris, the presidency of the Convention was assigned to the ageing but ever-vainglorious Valéry Giscard d’Estaing.

After two years of deliberations, the Convention emitted something more than a draft but decidedly less than a constitution. Shorn of its portentous Giscardian preamble (immediately and unfavourably contrasted with the elegant brevity of its Jeffersonian predecessor) the Convention’s document offered little by way of classic constitutional proposals—no sweeping definitions of individual liberty, no clear statement concerning the division of powers, etc. In this respect, as many had predicted, it was a disappointment.

But Giscard’s text—which after some discussion was adopted as a Constitutional Treaty in Rome in 2004—did provide a working blueprint for the practical management of the Union’s affairs: improved systems of coordination on defense and immigration; a simplified and unified summary of EU law; a Charter of Fundamental Rights for EU citizens aimed at further strengthening the authority of the European courts; a clear and even ambitious account of the Union’s formal competence and authority.

Above all, the proposed constitution would have served to reduce—over time—the top-heavy system of national representation in the Commission; and it devised a system for voting in the European Council that proved, after a certain amount of haggling, to be acceptable to all parties as well as demographically equitable. Whether the new dispositions would produce clear-cut majorities on difficult issues remained uncertain: all the more so since for truly contentious topics like taxation and defense it was nonetheless agreed—at British insistence but to the unspoken relief of many other countries—to retain the old Gaullist device of national vetoes. And no-one was in any doubt that for all the careful distribution of weighted votes, real power still lay with the biggest countries—as Ortega y Gasset had already concluded in 1930, ‘Europe’ was for practical purposes ‘the trinity of France, England, Germany’. But at least—and always assuming that the constitution was to be ratified in every member-state, which proved to be an unforeseen impediment—it would now be possible to reach decisions.

By 2004, then, the European Union had—to the surprise of many observers—seemingly overcome, or at least alleviated, the practical difficulties of governing an unwieldy and inchoate community of twenty-five separate states. But what it had not done—what neither Giscard’s Convention, nor the various Treaties, nor the European Commission and its multifarious reports and programmes, nor the expensive publications and websites designed to educate the European public about the Union and its workings had even begun to do—was to address the chronic absence of interest on the part of the European public.

If the technocrats who built the institutions of the new ‘Europe’ had shown a haughty unconcern for the opinions of the public at large, this sentiment was now being repaid in kind and in earnest. Reflecting bleakly upon his Labour Party colleagues’ obsession with the techniques and rules of party-political management, the British Prime Minister Clement Attlee used to advise against the ‘fundamental fallacy’ of believing that ‘it is possible by the elaboration of machinery to escape the necessity of trusting one’s fellow human beings’.356 But this was just the premise on which the institutions of post-war European unity had been built, with consequences that were at last becoming apparent. The EU was suffering from a serious ‘democratic deficit’.

With each direct election to the European parliament the turnout fell; the only exceptions to this rule were those occasions where national and European elections coincided and voters who had been mobilized around local or national issues took the occasion to vote in the European polls as well. Otherwise the decline was unbroken—in France it fell from 60 percent in 1979 to 43 percent in 2004; in Germany from 66 percent to 43 percent; in the Netherlands from 58 percent to 39 percent.357

The contrast between the level of interest that electors exhibited for national politics and their growing unconcern for the parliament in Strasbourg is especially revealing. At the European elections of June 2004, the first since the Union’s enlargement, the vote in the UK was down by 20 percentage points from the most recent national elections, in Spain by 23 percentage points; Portugal saw a drop of 24 percentage points, Finland 39 percentage points, Austria 42 percentage points and Sweden 43 percentage points (from an 80 percent turnout in Sweden’s own elections to just 37 percent for the European vote).

The pattern is far too consistent to attribute to local circumstances. Moreover—and with more serious implications for the Union’s future—it was closely replicated in the new member-states of the East, even though this was their first opportunity to vote in an election to the parliament of Europe that they had waited so long to join. In Hungary the turnout in the June 2004 European elections fell short of the last national elections by 32 percentage points; in Estonia by 31 points; in Slovakia, where the latest national elections had seen a 70 percent turnout, the share of the electorate that bothered to come and vote in the European elections was 17 percent. In Poland the turnout of just 20 percent represented a 26-point decline from the national elections of 2001 and was the lowest since the fall of Communism.

Why were Europeans, ‘old’ and ‘new’ alike, so profoundly indifferent to the affairs of the European Union? In large part because of a widespread belief that they had no influence over them. Most European governments had never held a vote to determine whether or not they should join the EU or the euro-zone—not least because in those countries where the issue had been put to a national referendum it was rejected, or else passed by the narrowest of margins. So the Union was not ‘owned’ by its citizens—it seemed somehow to stand apart from the usual instruments of democracy.

Moreover there was a widespread (and accurate) sentiment among European publics that of all the institutions of the EU, the 732 elected Members of the European Parliament were the least significant. Real power lay with a Commission appointed by national governments and a Council of Ministers comprising their representatives. National elections, in short, were where the crucial choices were to be made. Why waste time selecting the monkey when you should be paying attention to the choice of organ grinder instead?

On the other hand, as was becoming increasingly clear to even the most casual citizen, the ‘faceless’ men and women in Brussels now wielded real power. Everything from the shape of cucumbers to the color and wording of a person’s passport was now decided in Brussels. ‘Brussels’ could give (from milk subsidies to student scholarships) and ‘Brussels’ could take away (your currency, your right to dismiss employees, even the label on your cheese). And every national government had at one time or another over the past two decades found it convenient to blame ‘Brussels’ for unpopular laws or taxes, or economic policies which it tacitly favoured but for which it was reluctant to take responsibility.

In these circumstances, the Union’s democratic deficit could easily turn from unconcern into hostility, into a sense that decisions were being taken ‘there’ with unfavourable consequences for us ‘here’ and over which ‘we’ had no say: a prejudice fuelled by irresponsible mainstream politicians but fanned by nationalist demagogues. It was not by chance that in the same European elections of 2004 that saw such a sharp falling off in voter interest, many of those who did bother to turn up at the polls gave their support to overtly—sometimes rabidly—anti-EU candidates.

In western Europe the enlargement itself helped trigger this backlash. In Britain the Europhobic UK Independence Party and the white-supremacist British National Party between them took 21 percent of the vote, promising to keep the UK clear of ‘Europe’ and protect it from the anticipated onrush of immigrants and asylum-seekers. In Belgium the Vlaams Blok, in Denmark the Dansk Folkeparti (People’s Party), and in Italy the Northern League all played on a similar register—as they had done in the past, but with rather more success on this occasion.

In France, Jean-Marie Le Pen’s Front National took a similar position; but French doubts over European enlargement were not confined to the political extremes. It was an open secret that the French political establishment had long been opposed to expanding the EU and thereby diluting French influence: Mitterrand, Chirac and their diplomatic representatives had all worked hard to postpone the inevitable for as long as possible. Public opinion echoed these sentiments: in a poll taken four months before the new members were due to join the Union 70 percent of French voters declared the EU ‘unprepared’ for their arrival, while 55 percent opposed their inclusion altogether (compared to 35 percent of EU voters as a whole).358

But antipathy towards the EU also played a part in Eastern Europe. In the Czech Republic, the Civic Democratic Party—aligned with Václav Klaus and loudly skeptical of the EU and its ‘over-mighty’ powers—was the clear victor in 2004, winning 38 percent of the country’s European Parliamentary seats. In neighbouring Poland Euroskeptic parties of the far Right actually did better than the ruling center-left coalition—not surprisingly, perhaps, considering that in a Eurobarometer poll taken a few months previously only just over half the Polish electorate thought that the European Union was a ‘good thing’.

And yet, taken all in all, the EU is a good thing. The economic benefits of the single market have been real, as even the most ardent British Euroskeptics had come to concede, particularly with the passing of the passion for ‘harmonizing’ that marked the Commission Presidency of Jacques Delors. The newfound freedom to travel, work and study anywhere in the Union was a boon to young people especially. And there was something else. In relative terms, the so-called ‘social’ element in the EU budget was tiny—less than 1 percent of the European-area GNP. But from the late Eighties, the budgets of the European Community and the Union nevertheless had a distinctly redistributive quality, transferring resources from wealthy regions to poorer ones and contributing to a steady reduction in the aggregate gap between rich and poor: substituting, in effect, for the nationally based Social-Democratic programmes of an earlier generation.359

In recent years the citizens of Europe had even acquired their own court. The European Court of Justice (ECJ), set up in 1952 under the same Treaty of Paris that established the European Coal and Steel Community, had started out with the limited task of ensuring that EC legislation (‘Community law’) was interpreted and applied in the same way in each member-state. But by the end of the century its judges—originally one from each member-state—were authorized to settle legal disputes between member-states and EU institutions, as well as to hear cases brought against lower court decisions or even against national governments. The ECJ had, in effect, assumed many of the powers and attributes of a pan-European Court of Appeals.360

As the example of the Court suggests, the rather indirect and often unintentional manner in which the Union’s institutions emerged had its advantages. Very few lawyers or legislators in even the most pro-European states of the European ‘core’ would have been willing to relinquish local legal supremacy had they been asked to do so at the outset. Similarly, if a clearly articulated ‘European project’, describing the goals and institutions of the Union as they later evolved, had ever been put to the separate voters of the states of western Europe it would surely have been rejected.

The advantage of the European idea in the decades following World War Two had thus lain precisely in its imprecision. Like ‘growth’ or ‘peace’—with both of which it was closely associated in the minds of its proponents—‘Europe’ was too benign to attract effective opposition.361 Back in the early Seventies, when the French President Georges Pompidou first took to speaking airily of a ‘European Union’, Foreign Minister Michel Jobert once asked his colleague Edouard Balladur (the future French Premier) what exactly it meant: ‘Nothing’ replied Balladur. ‘But then that is the beauty of it.’ Pompidou himself dismissed it as ‘a vague formula . . . in order to avoid paralyzing doctrinal disputes’.362

Of course it is this formulaic vagueness, combined with the all-too-precise detail of EU legislative directives, which has given rise to the democratic deficit: it is hard for Europeans to care about a Union whose identity was for so long unclear, but which at the same time appears to impinge upon every aspect of their existence. And yet, for all its faults as a system of indirect government, the Union has certain interesting and original attributes. Decisions and laws may be passed at a trans-governmental level, but they are implemented by and through national authorities. Everything has to be undertaken by agreement, since there are no instruments of coercion: no EU tax collectors, no EU policemen. The European Union thus represents an unusual compromise: international governance undertaken by national governments.

Finally, while the European Union has neither means nor mechanisms to prevent its member-states coming to blows, its very existence renders the idea somehow absurd. The lesson that war was too high a price to pay for political or territorial advantage had already been brought home to the victors after World War One, though it took a second war to convey the same lesson to the losing side. But just because a third intra-European war would have been catastrophic and perhaps terminal does not mean it could not have happened, at least in the early postwar years.

By the end of the century, however, the elites and institutions of the European Union were so intertwined and interdependent that armed conflict, while never impossible, had become somehow inconceivable. That is why ‘Europe’ was such an object of desire to aspirant members like Latvia or Poland, an escape route out of their past and an insurance policy for the future. But it is also, ironically, why the EU’s own leaders proved so fatuously helpless when confronted with the reality of war in the Balkans.

Its humiliation over Yugoslavia363 is a reminder that the European Union cannot escape the defects of its virtues. By not being a state the Union has been able to bind some 450 million people into a single, loosely articulated community with remarkably little dissent. But because it is not a state—because its citizens’ primary loyalties remain to the country in which they find themselves, whose laws they obey, whose language they speak and whose taxes they pay—the EU has no mechanism for determining or enforcing its own security interests.

This does not mean that ‘Europe’ has no common foreign policy. On the contrary, the European Community and its successor the EU have for many decades been extremely effective in advancing and defending their interests in international forums and against foreign competitors. But those interests have from the outset been defined in overwhelmingly economic—or more precisely, protectionist—terms. European economics ministers and trade commissioners have engaged in open combat with Washington over tax breaks for American exporters or import restrictions on European products.

More controversially, the EU has also fought very effectively to maintain high external tariffs in defense of Europe’s subsidized farmers—restraining open trade in commodities like sugar, for example, to the detriment of farmers in Africa or Central America.364But whereas the separate member states of the EU—even the most powerful ones—have been pleased to pass on to Brussels responsibility for presenting their economic case in the World Trade Organization and elsewhere, they have reserved for themselves thevital attribute of any modern state. The European Union has no army.

In part this is an accident of history. In the early 1950s there were many who thought that in future the Western Europeans could and should organize their military affairs collectively—at an August 1950 meeting of the Council of Europe’s Consultative Assembly, Paul Reynaud of France even argued the case for a European Minister of War. But the defeat of the proposal for a European Defense Force (see Chapter 8), and the incorporation of West Germany into NATO, put an end to such ideas for a generation; instead Western Europe snuggled comfortably under the American nuclear umbrella.

Following the end of the Korean War and the retreat from empire, every Western European country cut its defense budget. With the fall of Communism, spending on the military reached new lows. In the late Eighties the average share of defense spending in NATO members’ budgets had already declined to 3.4 percent of GNP; by 2003 Denmark was spending just 1.6 percent of GNP on defense; Italy 1.5 percent; Spain a mere 1.4 percent. Only the French and British spent substantially more, though in neither case did spending now exceed 5 percent—negligible by historical standards.

Moreover, none of the armed forces of Europe was under ‘European’ control or likely to be in the foreseeable future, despite plans announced in 2000 for a European ‘Rapid Reaction Force’. Although there had for some years been a European Commissioner for External Relations, since the Treaty of Amsterdam his functions were duplicated (and his authority thereby diminished) by a High Representative for the Common Foreign and Security Policy, answerable only to the EU Council of Ministers. And neither the Commissioner nor the High Representative had any authority to initiate his own policy, despatch armed forces or speak for the foreign policies or ministers of the member-states unless previously instructed. Henry Kissinger’s sardonic question of an earlier decade—‘If I want to phone Europe, what number do I call?’—had lost none of its force.

But these limitations—the fact that in spite of its size and wealth the EU was not a state, much less a great power—paradoxically served to enhance its image, at home and abroad. In this respect at least the EU was indeed coming to resemble Switzerland, a repository of international agencies and cooperation, an exemplar of ‘post-national’ strategies for problem solving and social cohesion: not so much a network of institutions or a corpus of laws but rather a set of values—‘European values’—embodied in the new Charter of Fundamental Rights.

If the values and norms of this new Europe were under pressure at the end of the twentieth century it was not from the established nation-states against which the European idea had been traditionally but misleadingly juxtaposed. Instead, both the EU and its various member-states were now facing an unprecedented wave of economic and social challenges brought upon them by forces largely beyond their control, most of them associated in one way or another with what it was becoming customary to designate as globalization.

There was nothing especially mysterious about globalization. It wasn’t even unprecedented—the impact on the world economy of new and rapid networks of transport and communications at the end of the nineteenth century was at least as dramatic as the transformation wrought by the Internet and the deregulation and liberalization of financial markets a century later. Nor was there anything new about the unequal global distribution of the benefits of liberalized trade—particularly when, at the end of the twentieth century no less than in the years before 1914, international trade regimes were so consistently accommodating to the interests of the powerful and wealthy.

But from the European perspective the latest transformations in the world economy were distinctive in one important respect. At the end of the nineteenth century the European states were just beginning to expand their domestic reach: in time many of them would own, operate or regulate large sectors of the economy. Government expenditure—financed out of new, progressive taxes—would increase dramatically, partly to pay for wars but increasingly for the purpose of servicing social and welfare needs for which the state was now assuming responsibility.

The economic internationalization of the nineteen-nineties, however, followed closely in the wake of the first great wave of European privatizations and provided the impetus for more to come (see Chapter 17). The European state was now in retreat—first in Britain, then much of Western Europe and finally in the former-Communist East—a process further abetted by the implementation after 1987 of the Single European Act, with its provisions for open competition within and across borders. Through mergers, acquisitions and the internationalization of their operations, companies and corporations now operated on a global scale. The production and distribution of goods was often beyond the control of individual countries.

As for money, it was beginning to multiply and migrate in ways that would have been unthinkable a few years before. In 1980 the sum of all international bank lending was $324 billion a year; by 1991 that figure had grown to $7.5 trillion—a 2,000 percent increase in just over a decade. And this was just the beginning. Controls on the movement of capital—eliminated by most European states in the course of the early Eighties—now appeared as antiquated as food rationing. The ‘crash’ of September 1992—when first the UK and then Italy were forced out of the European Monetary System and obliged to devalue by private speculators and institutional investors whose activities they were powerless to prevent—was a highly symbolic moment.

The advantages of this revolution in the international economy were self-evident. Investment capital, no longer restrained by national frontiers, exchange-rate regimes or local currency regulation, flowed unchecked wherever it was needed (and could anticipate a profit)—by 1990 foreigners already held 34 percent of German debt. But there were disadvantages too: European manufacturers, their profit margins constrained by the high wages and overhead costs of employing skilled labor in Germany or France or Sweden, were now at liberty to seek out not only international investors but also a more malleable and inexpensive foreign workforce.

Instead of importing into Europe cheap workers from poor countries—as in the past—German or British or French firms now found it more efficient to export their factories instead, installing them in Brazil or Nigeria, Portugal or Romania and then directly selling the finished product to markets all over the world. This further accelerated the de-industrialization of Western Europe, adding to the already chronic unemployment in many regions—and increasing the burden on state-provided unemployment compensation and other social services.

When the last coalmine in France—at Creutzwald in the Moselle—closed in April 2004, no-one even pretended that the former miners would ever find regular work again. Unemployment in the Moselle district hovered around 10 percent of the active population; further north, in the former mining towns along the Belgian border, it was 15 percent. France as a whole had lost 1.5 million industrial jobs in the last three decades of the century, most of them since 1980. Spain, which very quickly lost any comparative advantage that accrued to it from being one of Western Europe’s more backward economies, shed 600,000 jobs in the twenty years following the transition to democracy. At the height of the recession of the mid- 1990s, 44 percent of the country’s under-25 workforce was unemployed.

Unemployment was not new. And given the generous welfare net available in most EU countries, the economic impact of joblessness on individuals and communities was in no way comparable to the devastation of the inter-war years (its psychological consequences are another matter). But what was distinctive about the social costs of economic disruption in the last years of the twentieth century was that they were taking place in a time of plenty. Privatization and the opening of the financial markets had created great wealth, albeit for a relative few; in certain places—London, say, or Barcelona—its consequences were strikingly visible. And thanks to the shrinking of distances and the increased speed of communications—via computers and the electronic media—information about the way other people lived was immediately and copiously available to all.

It was this sense of glaring contrasts between wealth and poverty, prosperity and insecurity, private affluence and public squalor, that drove a growing skepticism in Europe about the loudly touted virtues of unregulated markets and untrammeled globalization—even as many Europeans were themselves the indirect beneficiaries of the changes they deplored. In the past, such sentiments—added to pressure from organized labour and the self-interest of politicians—might have favoured a retreat to some form of limited protectionism.

But governments’ hands were now tied and organized labour, in the traditional sense, hardly existed anymore. Only in France did a unionized workforce succeed with the help of public opinion in temporarily blocking the sell-off of public companies: and even then only in special instances like Electricité de France, an icon of the post-war nationalized sector whose employees were among the few remaining members of the once-giant (Communist-led) Confédération Générale du Travail (CGT). In the last years of the century, even as the rest of the European energy market was deregulated, EdF remained in state ownership.

But the CGT, once the dominant blue-collar union in France, was a shadow of its former self—the French union movement as a whole had lost two-thirds of its members since 1980—and the workers it represented were no longer typical of the laboring population in France or elsewhere. Work itself had changed. What was emerging in many places was a novel, four-class system. At the top was the new professional stratum: metropolitan, cosmopolitan, affluent and educated—often attached to banks and other financial agencies, the primary beneficiaries of the new global economy. Then came a second tier, a protected core of traditional employees—in factories, service industries or the public sector—their jobs reasonably secure and many of their traditional benefits and guarantees still intact.

A third tier consisted of small businesses and services—corner-storekeepers, travel agents, tailors, electronic repairmen and the like—more often than not owned and staffed by immigrant communities or their descendants (Arabs in France, Turks or Kurds in Germany, South Asians in Britain). To these should be added the very sizeable and typically family-based ‘grey’ economy in Southern Europe. In Italy, where everything from shoes to textiles to machine parts was often produced and distributed below the radar of officialdom, it was estimated in 1997 that the ‘informal’ sector contributed at least one quarter of the country’s Gross Domestic Product. In Portugal the national figure—inevitably an estimate—was 22 percent; but in some regions—like the town of Braga in the far north of the country—‘unofficial’ workers constituted as much as 45 percent of the local labour force.

And then came the fourth tier—the fastest growing: people employed (if at all) in jobs that lacked both the long-term security of traditional skilled work and the benefits that had become standard in the boom years of the Fifties and Sixties. To be sure, unemployment figures in some countries—Britain, or the Netherlands—did eventually fall to gratifyingly low levels: proof, it was widely bruited, of the virtuous workings of the unhindered and globalized market. But many of those who no longer figured on unemployment rolls—women and young people especially—were now doing low-paid, part-time work without benefits; or else were employed on fixed-term contracts in job programmes subsidized or under-written by the state.

Those whose wages were too low to support them and their families could still turn to the welfare state, and many did. In the UK, where the Thatcherite assault on state and society alike had been felt most acutely, 14 million people now lived in poverty, including 4 million children.365 One person in six depended upon Income Support or Family Credit programmes to keep them above the poverty line. Homelessness, which in northern Europe at least had been effectively eradicated by the end of the 1950s, was once again on the increase: in the course of the Thatcher years the number of homeless in London alone rose ten-fold. By the mid-’90s it had reached 80,000. Within a few miles of some of the most expensive real estate in the world parts of the British capital were beginning to resemble the ‘Outcast London’ of late-Victorian notoriety.366

Whereas, in the past, economic upswings had tended to lift many of the poor into better paid and more secure employment, this was no longer happening. Europe, in other words, was developing an under-class in the midst of plenty. As the French sociologist André Gorz had predicted back in the 1960s, the end of the industrial era would see the birth of a new caste of casual, temporary workers—a ‘non-class of non-workers’—at once marginal to modern life and yet somehow right at its heart.367

Like its American equivalent, the European under-class was determined not only by poverty and unemployment (or under-employment) but also and increasingly by race: in the mid-’90s the unemployment rate in London for young black men was 51 percent. The poor, like Europe as a whole by the end of the century, were strikingly multinational—or ‘multicultural’ as it had become custom to describe it, in acknowledgement of the fact that many dark-skinned Dutchmen or Germans or Brits were the native-born children or even grandchildren of the original Moroccan or Turkish or Pakistani immigrants. Towns like Rotterdam or Leicester were now multi-lingual and multi-colored in a way that would have amazed anyone returning after an absence of even just two decades. In 1998, white children were a minority in the local authority (i.e. public) secondary schools of inner London.

Europe’s major cities, London above all, were now truly cosmopolitan. If the high-paying city jobs were still going to white Europeans (and North Americans) nearly all the low-paying work, from street-cleaning to child-care, was now done not by traditional ‘second-class’ Europeans from theAlentejo or the Mezzogiorno but by ‘minorities’, often black or brown, many of them without working papers. According to official figures the net increase in foreigners living in London and the south-east of England in the years 1992-2002 was 700,000; but the actual number was distinctly higher.

Immigration, though perennially discouraged and rigorously controlled throughout Western Europe, was thus still a major demographic factor: of those same inner-London children of 1998, one third did not use English as their first language. These were frequently the offspring of refugees, ‘asylum-seekers’ in the jargon of the day, whose numbers had ballooned in the wake of the Yugoslav wars; but also of migrant workers from Central and South-East Asia, the Middle East and much of Africa—many of them illegal and thus undocumented.

In Germany, whose asylum facilities were (and remain) by far the most generous in Europe368 but where it was traditionally very difficult for immigrants to obtain full citizenship, it was estimated that there were five million such people—counting families and dependants—by the end of the century. The majority of asylum applications to Germany by the beginning of the new century came from Iraq, Turkey and the countries of former Yugoslavia, but there were also growing numbers from Iran, Afghanistan, Russia and Vietnam.

The fear that Western Europe might be ‘overrun’ by ‘economic refugees’, illegal immigrants, asylum-seekers and the like contributed to a widespread lack of enthusiasm for EU enlargement. Already by the 1980s undocumented workers from Poland were present in large numbers in the British and German building trades. But the problem was not so much Poland, or Hungary, or the other would-be accession states of Central Europe, but rather the lands to their east. In 1992 Poland itself had 290,000 ‘irregular’ immigrants, mostly from Bulgaria, Romania and the former USSR; Hungary, with a population of just 10 million, was home to over 100,000 asylum-seekers. Whereas life there—or in Slovakia or the Czech Republic—was hard, it was not intolerable and the gap separating these countries from their Western neighbours was already being bridged, however slowly. The gulf between Central Europe and the rest of post-Communist Europe, however, yawned far greater.

Thus whereas by the late-Nineties the average monthly wage in Poland and the Czech Republic was already approaching $400, in Belarus, Ukraine and Romania it hovered around $80; in Bulgaria at under $70; and in Moldova at just $30—itself a misleading average, since outside of the capital, Chisinau, incomes were lower still, in a population of whom 48 percent still worked on the land. And unlike Poland, or even Bulgaria, the condition of the former Soviet republics was not improving: by the year 2000, one Moldovan in two was earning less than $220 a year—just $19 a month.

In such circumstances the only hope for Moldovans—or Ukrainians, or indeed many Russians outside of the major conurbations—was to find work in the West. And so an alarming number of them—young women above all—ended up in the hands of criminal syndicates, shipped into the EU through Romania and the Balkans to be employed at best as indentured servants in workshops and restaurants, at worst and more often as prostitutes: in Germany or Italy—or even Bosnia, servicing a well-paid clientele of Western soldiers, administrators and ‘aid-workers’. Involuntary Moldovan and Ukrainian ‘guest-workers’ thus joined the Roma (Gypsies) at the bottom of the continent’s multi-cultural heap.369

The victims of the sex trade were largely invisible—like earlier generations of white migrants from Europe’s fringes they blended easily enough into the local majority, which is why they proved so hard for police and social services to trace. But most of the people whom French sociologists and critics had taken to describing as les exclus (‘the excluded’) were perfectly visible. The new under-class consisted of people excluded not so much from work as from ‘life chances’: individuals stranded outside the economic mainstream, their children poorly educated, their families marooned in barrack-like apartment blocks at the edge of cities, bereft of shops, services and transport. In 2004, a study by the French interior ministry concluded that some two million such people lived in urban ghettos blighted by social exclusion, racial discrimination and high levels of domestic violence. In some of these quartiers chauds youth unemployment had reached 50 percent; the worst affected were young people of Algerian or Moroccan descent.

All too often this under-class was distinguished not just by colour but by creed. For in addition to being multi-cultural the European Union was now increasingly multi-religious. Christians remained in the overwhelming majority, albeit non-practicing in most cases. Jews were now a small minority, their numbers significant only in Russia, France and to a much lesser extent the UK and Hungary. But Hindus and above all Muslims were now a substantial and visible presence in the UK, Belgium, the Netherlands and Germany, as well as in the main cities of Scandinavia, Italy and Central Europe. And—uniquely among the major world religions in Europe—the number of adherents to Islam was rising rapidly.

By the first years of the twenty-first century there were perhaps six million Muslims in France (the majority of North African extraction) and almost as many in Germany (chiefly of Turkish or Kurdish background). Together with the nearly two million Muslims in the UK (mostly from Pakistan and Bangladesh) and a significant presence in the Benelux countries and Italy, these figures suggested a total of perhaps fifteen million Muslims in the Union as a whole.

The Muslim presence in communities that were hitherto overwhelmingly secularposed difficult questions of social policy: what provision should be made for the wearing of religious clothing or symbols in public schools? How far should the state encourage (or discourage) separate cultural institutions and facilities? Was it good policy to support multi-cultural (and thus effectively separate) communities or should the authorities seek rather to facilitate and even enforce integration? Official policy in France advocated cultural integration and forbade the display of signs of faith in school; elsewhere, notably in Britain and the Netherlands, there was a broader tolerance for cultural distinction and assertive religious self-identification. But opinion everywhere was divided (see Chapter 23).

If such questions had risen rapidly to the top of national political agendas, and were increasingly entangled in debates over immigration and asylum, it was because of growing anxiety all across the continent at the rise of a new generation of xenophobic parties. Some of these parties had roots in an earlier age of sectarian or nationalist politics; others—like the surprisingly successful Dansk Folkeparti or the List Pim Fortuyn in the Netherlands—were of very recent provenance. But all of them had proven unexpectedly adept at exploiting ‘anti-immigrant’ sentiment.

Whether, like the British National Party, they railed against ‘ethnic minorities’ or, like the Front National’s Jean-Marie Le Pen, they targeted ‘immigrants’—in German the preferred term was ‘foreigners’ or ‘aliens’—the parties of the far Right found rich pickings in these years. On the one hand slower growth combined with vulnerability to global economic forces was exposing many working people to a level of economic insecurity unprecedented in living memory. On the other hand the old organs of the political Left were no longer in place to corral and mobilize that insecurity under the banner of class: it was not by chance that the Front National often got its best results in districts that had once been bastions of the French Communist Party.

The presence in increasing numbers of a visible and culturally alien minority in their midst—and the prospect of even more foreigners feeding at the welfare trough or taking ‘our’ jobs once the floodgates from the East were opened—was icing on the cake for the new Right. Charging that the ‘boat is full’—or that their governments had abandoned control of its frontiers to ‘cosmopolitan interests’ or the ‘bureaucrats of Brussels’—populist demagogues promised to stop immigration, repatriate ‘foreigners’ and return the state to its embattled white citizenry, outsiders in their own country.

Compared with the Fascism of an earlier age this latest manifestation of xenophobia might appear mild—though Germany saw a wave of hate crimes against foreigners and minorities in the early Nineties that prompted some commentators to raise broader concerns: Günter Grass pointed accusingly to the self-centered indifference of West German political culture and the country’s myopic enthusiasm for an ‘unmerited’ unity, arguing that responsibility for the racist violence (especially in the festering, defunct industrial towns of the former GDR where anti-foreigner feeling was most intense) should be placed squarely at the feet of the country’s complacent and amnesiac political elite.

But even if the level of violence was contained, the scale of public support for the new Right was cause for serious concern. Under Jörg Haider, its youthful and telegenic leader, the Freedom Party (FP) in neighbouring Austria—heir to the postwar League of Independents but ostensibly purged of the latter’s Nazi associations—rose steadily in the polls, presenting itself as the defender of the ‘little people’ left behind by the mutually beneficial collaboration of the two big parties and threatened by the hordes of ‘criminals’, ‘drug-users’ and other ‘foreign rabble’ now invading their homeland.

To avoid falling foul of the law, Haider was generally careful to avoid behaviour that would tar him too obviously with the brush of Nazi nostalgia. For the most part the Austrian (like Jean-Marie Le Pen) revealed his prejudices only indirectly—for example, by naming, as instances of whatever it was in public life that offended him, people who just happened to be Jewish. Both he and his audiences were more comfortable with newer targets like the European Union: ‘We Austrians should answer not to the EU, not to Maastricht, not to some international idea or other, but to this our Homeland’.

In the Austrian parliamentary elections of 1986, Haider’s Freedom Party won 9.7 percent of the vote. Four years later it had risen to 17 percent. In the elections of October 1994 it rocked the Viennese establishment by reaching 23 percent, just four points short of the People’s Party which had governed the country for the first twenty-five years after the war and which still dominated Austria’s rural provinces. Even more ominously, Haider had bitten deep into the traditionally Socialist electorate of working-class Vienna. Considering that (according to 1995 opinion polls) one Austrian in three believed with Haider that ‘guest-workers’ and other foreigners in Austria had too many benefits and privileges, this was hardly surprising.

Haider’s influence peaked at the very end of the century, in the wake of the elections of October 1999 when his party received the backing of 27 percent of Austria’s voters: pushing the People’s Party into third place and coming within 290,000 votes of the first-place Socialists. In February 2000, to somewhat exaggerated gasps of horror from Austria’s European partners, the People’s Party formed a coalition government with the Freedom Party (though not including Haider himself). But the new Austrian Chancellor, Wolfgang Schüssel, had made a shrewd calculation: the Freedom Party was a movement of protest, an anti-‘them’ party that appealed to ‘the ripped-off, lied-to little people’ (to quote Pierre Poujade, the eponymous populist prototype). Once in government, exposed to the wear and tear of office and constrained to share responsibility for unpopular policies, it would soon lose its appeal. In the elections of 2002 the FP scored just 10.1 percent (while the People’s Party had risen to nearly 43 percent). In the European elections of 2004 Haider’s party was reduced to 6.4 percent of the vote.

The rise and decline of Haider (who remained nevertheless a popular governor of his native Carinthia) was emblematic of the trajectory of anti-foreigner parties elsewhere. After winning 17 percent of the vote in 2002, in the wake of its leader’s assassination, the List Pim Fortuyn rose briefly into the ranks of Dutch government only to see its support collapse to just 5 percent at the subsequent election and its parliamentary representation fall from 42 to 8. In Italy the Lega Nord’s ascent into government under the wing of Berlusconi precipitated a steady fall in its support.

In Denmark, the Dansk Folkeparti had risen from obscure beginnings in 1995 to become by 2001 the country’s third-largest parliamentary group. By staying out of office and focusing almost exclusively on the immigration issue, the party and its leader Pia Kjærsgaard were able to leverage their influence out of all proportion to size. Both the leading Danish parties—Liberals and Social Democrats—now competed to outbid the other in their newfound ‘firmness’ on laws governing asylum and foreign residents. ‘We’—as Kjærsgaard put it after her party won 12 percent of the vote in the elections of 2001—‘are in charge’.370

In the sense that there was now almost no mainstream politician of Left or Right who dared appear ‘soft’ on such issues, she was right. Even the tiny, thuggish British National Party (BNP) was able to cast a shadow on the policies of New Labour governments in the UK. Traditionally marginal—its best recent performance had been 7 percent of the vote in 1997 in an East London district where Bengalis had replaced Jews as the local ethnic minority—the BNP won 11,643 votes (14 percent) four years later in two districts of Oldham, a former mill town in Lancashire where race riots had broken out shortly before the elections.

These were negligible figures compared with developments on the Continent and the BNP came nowhere near winning a parliamentary seat. But because (according to opinion polls) its concerns appeared to reflect a widespread national unease, the hard Right was able to frighten Prime Minister Tony Blair into tightening still further the UK’s already ungenerous provisions for would-be immigrants and refugees. It says something about the mood of the time that a New Labour government with an overwhelming parliamentary majority and nearly 11 million voters at the 2001 elections should nonetheless have been moved to respond in this way to the propaganda of a neo-Fascist clique which attracted the support of just 48,000 electors in the country at large: one-fifth of 1 percent of the vote and only 40,000 more votes than the Monster Raving Loony Party.

France was another matter. There the Front National had an issue—immigrants; mass backing—2.7 million voters at the general elections of 1986; and a charismatic leader brilliantly adept at converting generalized public dissatisfaction into focused anger and political prejudice. To be sure, the far Right would never have done so well had Mitterrand not cynically introduced into France in 1986 a system of proportional representation designed to engineer the parliamentary success (and thus national visibility) of the Front National—and thereby divide and weaken France’s mainstream conservative parties.

But the fact remains that 4.5 million French voters backed Le Pen in the presidential elections of 1995: a number that rose to 4.8 million in April 2002 when the FN leader achieved an unprecedented success, taking second place in a presidential election with 17 percent of the vote and forcing the Left’s candidate, the hapless Socialist Prime Minister Lionel Jospin, out of the race. In France, too, the conclusion reached by mainstream politicians was that they must somehow draw the sting of Le Pen’s appeal by appropriating his concerns and promising tough measures to address ‘security’ and immigration, without explicitly condoning either Le Pen’s language—or his program (‘France for the French’ and repatriation for everyone else).

Despite Le Pen’s own links to an older tradition of far-Right politics—through his youthful support for the Poujadists, his passage through the shadowy organizations of the far-Right during the Algerian war, and his carefully phrased defense of Vichy and the Pétainist cause—his movement, like its counterparts all across the continent, could not be dismissed as simply an atavistic, nostalgic regurgitation of Europe’s Fascist past. Certainly Fortuyn or Kjærsgaard could not be categorized thus. Indeed both took care to emphasize their desire to preserve their countries’ traditional tolerance—under threat, they asserted, from the religious fanaticism and retrograde cultural practices of the new Muslim minorities.

Nor was Austria’s Freedom Party a Nazi movement; and Haider was not Hitler. On the contrary, he took ostentatious care to emphasize his post-war credentials. Born in 1950 he had, as he repeatedly reminded audiences, ‘die Gnade der späten Geburt’: the good fortune of a late birth. Part of Haider’s success—like that of Christoph Blocher, whose Swiss People’s Party won 28 percent of the popular vote in 2003 on an anti-immigrant, anti-EU ticket—came from his skill at burying a racist sub-text under the image of a modernizer, a national-populist of the liberal persuasion. This played surprisingly well to youthful voters: at one point the Freedom Party was the leading party in Austria among the under-thirties.371

In Austria as in France it was the fear and hatred of immigrants (in France from the south, in Austria from the east, in both cases from lands over which they once ruled) that has replaced the old obsessions—anti-semitism especially—as the tie that binds the far Right. But the new anti-system parties also benefited from something else: clean hands. Excluded from office, they were untainted by the corruption which seemed, by the early Nineties, to be gnawing at the roots of the European system. Not just in Romania or Poland or (above all) Russia, where it could be explained away as the collateral cost of a transition to capitalism: but in the democratic heartlands of the continent.

In Italy, where ever since the war the Christian Democrats had enjoyed a cozy and profitable relationship with bankers, businessmen, contractors, city bosses, state employees and—it was widely rumored—the Mafia, a new generation of young magistrates began courageously to chip away at decades of barnacled public silence. Ironically it was the Socialist Party that fell first, brought down by the tangentopoli (‘bribe city’) scandal in 1992 that followed investigations into its management of the city of Milan. The party was disgraced and its leader, the former Prime Minister Bettino Craxi, was forced to flee across the Mediterranean into exile in Tunisia.

But the Socialists’ affairs were inextricably intertwined with those of the Christian Democrats, their long-time coalition partner. Both parties were further discredited by the wave of arrests and charges that followed, and they took down with them the whole web of political arrangements and accommodations that had shaped Italian politics for two generations. In the elections of 1994, all the country’s leading political parties except the former-Communists and the ex-Fascists were virtually wiped out—though the only lasting beneficiary of this political earthquake was a former lounge singer, the louche media magnate Silvio Berlusconi, who entered politics not so much to further the national house-cleaning as to ensure that his own business dealings remained safely unaffected.

In Spain it was a scandal of a rather different sort that ended the political career of Felipe González, when it was revealed in the mid-’90s (by an enthusiastic younger generation of investigative reporters in the dailies El Mundo and Diario 16) that his government had conducted a ‘dirty war’ against Basque terrorism during the years 1983-87, allowing and encouraging death squadrons to practice kidnapping, torture and assassination, both in Spain and even across the frontier in the Basque regions of France whence ETA frequently operated (see Chapter 14).

In view of ETA’s reputation, this might not have sufficed to discredit the charismatic González—thanks to the cynical public mood of the late Franco years many of his contemporaries had grown up with a distinctly instrumental view of the state and its laws—were it not for parallel revelations of graft and influence-peddling by González’s Socialist colleagues that echoed the Italian example and aroused widespread anxiety over the moral condition of a Spanish democracy still in its infancy.

In France—or Germany, or Belgium—the spate of scandals that disfigured public life in the Nineties suggested not so much the fragility of institutions and mores as the rising cost of practicing democracy under modern conditions. Politics—staff, advertising, consultancies—are expensive. Public cash for political parties was strictly limited in Europe by law and tradition and usually made available only for the purpose of standing at elections. If they needed more, politicians had in the past turned to their traditional backers: party members, mass unions (on the Left) and private businessmen and corporations. But these resources were drying up: party membership figures were falling, mass unions were on the decline and with a growing cross-party policy consensus on economic affairs, companies and private individuals saw little reason to contribute generously to any one party.

Perhaps understandably, in any case more or less universally, the major political parties of Western Europe began to seek out alternative ways to attract funding—just at the time when, thanks to the abolition of controls and the globalization of business, there was a whole lot more money around. Gaullists and Socialists in France—like the Christian Democrats in Germany and New Labour in Britain—were revealed to have raised cash over the past two decades in a variety of shady ways: whether by selling favours, peddling influence or simply leaning rather more insistently than in the past upon conventional contributors.

Things went a little further in Belgium: one scandal among many—the so-called Dassault/Agusta affair—can serve as an illustration. At the end of the 1980s, the Belgian government contracted to purchase forty-six military helicopters from the Italian firm Agusta and to give the French company Dassault the job of refitting its F-16 aircraft. Competing bidders for the contracts were frozen out. In itself this was not unusual, and the fact that three countries were involved even lends an ecumenically pan-European quality to the affair.

But it later emerged that Belgium’s Socialist Party (in government at the time) had done rather nicely from kickbacks on both deals. Shortly thereafter, one leading Socialist politician who knew too much, André Cools, was killed in a parking lot in Liège in 1991; another, Etienne Mange, was arrested in 1995; and a third, Willy Claes, a former prime minister of Belgium, sometime (1994-1995) secretary-general of NATO and foreign minister when the deals were made, was found guilty in September 1998 of taking bribes for his party. A fourth suspect, the former army general Jacques Lefebvre who was closely involved in the affair, died in mysterious circumstances in March 1995.

If this is a peculiarly Belgian story (‘La Belgique’ according to Baudelaire, ‘est sans vie, mais non sans corruption’) it is perhaps because the duplication and dilution of constitutional authority there had led not just to the absence of government oversight but to the near-collapse of much of the apparatus of the state, including the criminal justice system. Elsewhere, with the exception of Italy as noted above, there was strikingly little evidence of personal corruption—most of the crimes and misdemeanors were undertaken quite literally for the good of the party372—but a number of very prominent men were nevertheless forced abruptly out of public life.

These included not just González, the French ex-Prime Minister Alain Juppé and the historic leaders of Italy’s Christian Democrats; but even former German ChancellorHelmut Kohl, the hero of unification, whose reputation was cast under a cloud when he refused to divulge the names of secret donors to his party’s funds. Had he not been protected by his office, French President Jacques Chirac—mayor of Paris during a time when the city was awash in party-political graft and favour-peddling—would surely have joined their ranks.

What is perhaps most striking about these developments is how relatively little discredit they seem to have brought upon the political system as a whole. The decline in turnout at elections certainly bespeaks a general loss of interest in public affairs; but this could already be detected decades earlier in rising abstention rates and the diminished intensity of political argument. The real surprise is not the rise of a new cohort of right-wing populist parties but their consistent failure to do even better than they have, to capitalize on the disruption and discontent since 1989.

There was a reason for this. Europeans may have lost faith in their politicians, but at the core of the European system of government there is something that even the most radical anti-system parties have not dared to attack head on and which continues to attract near-universal allegiance. That something is certainly not the European Union, for all its manifold merits. It is not democracy: too abstract, too nebulous and perhaps too often invoked to stand in isolation as an object for admiration. Nor is it freedom or the rule of law—not seriously threatened in the West for many decades and already taken for granted by a younger generation of Europeans in all the member states of the EU. What binds Europeans together, even when they are deeply critical of some aspect or other of its practical workings, is what it has become conventional to call—in disjunctive but revealing contrast with ‘the American way of life’—the ‘European model of society’.

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