Year LIX, 2017, Single Issue, Page 78



Federalism: a Vision and a Method*






The federal vision in Europe was suffocated back in the 1950s, and the European Union has indeed developed along lines very different from those envisaged by the original federal approach. However, the various crises of the second decade of this new century have led to a strong revival of the federal vision. In an effort to explain this development, I will proceed as follows. After first describing the building of the common market, a supranational process, I will outline the affirmation of the intergovernmental method in the 1990s. Then, after examining the consequences of the multiple crises we have witnessed in the past decade, I will make some considerations on the return of federalism in public debate that they have prompted. I will conclude with a look at the form of federalism that, I suggest, can solve the dilemmas created by these crises.

The Functionalist Roots of European Integration.

The European Union is the result of a pact for peace, without which Europe could never have rebuilt itself, economically or democratically, after the Second World War. It represents the institutional response to Europe’s dramatic experiences in the first half of the twentieth century. Reasoning on the future of the European Union necessarily entails examining the sustainability of its institutional model, a model that is now being questioned both within the countries of Western Europe and by those of Eastern Europe. To understand how the European Union came into being and developed, it is useful to use the concept (taken from the field of comparative political analysis) of the critical juncture. There are phases in history (in the history of an organisation, a system, a country) in which windows of opportunity open, meaning periods in which it is possible to opt to take unforeseen paths, and in which political leaders, or those with decision-making power, are free to make relatively unconditional choices. Such choices define the path that will thereafter be followed. Once these critical periods end, and the choices made have been institutionalised, political dynamics follow a predetermined direction (i.e. are subject to path dependency).

The first critical juncture of interest to us in the present context is the post-war period. After World War II, the political leaders of the countries that had been prominent in the conflict became engaged in a debate that also involved technicians, i.e. individuals who, crucially, operated outside the political arena. In this setting, there emerged two visions: the federalist vision, promoted (among others) by Altiero Spinelli, and the functionalist vision, promoted (among others) by Jean Monnet. According to the federalist vision, it was necessary to create the “political moment” (Mario Albertini’s expression) in which to launch European integration. This vision was structured along two essential lines: one economic (represented by the European Coal and Steel Community, or ECSC), and the other political (represented by the European Defence Community, or EDC). In fact, these two Treaties (ECSC and EDC) came into being contemporaneously and both derived from the same need and aspiration, concisely expressed in the Schuman Declaration of 9th May 1950: to lay the “foundations for economic development as a first step in the federation of Europe”. In particular, it was envisaged that once the EDC was established, the next objective to pursue would be common governance of European security.

However, in August 1954, the French National Assembly sank the EDC project, leaving open only the possibility of economic integration. This is the point at which the functionalist vision began to prevail. In Jean Monnet’s view, the integration project needed to be re-started from the bottom (the market) rather than the top (the institutions). The right way forward, he felt, was to foster inter-state cooperation on concrete economic issues, with the idea that this cooperation would, in turn, strengthen the role of functional European institutions, such as the Commission and the Court of Justice. Although the defeat of the EDC project in August 1954 was, as we know, attributable to reasons of French domestic politics, and had nothing to do with the value of the project itself, the French National Assembly’s decision nevertheless closed the window of opportunity that had opened up in the wake of the war. Thus, the federalist vision espoused by Altiero Spinelli (who believed that federation of Europe needed to start with the creation of the necessary institutions) was replaced by the functionalist one championed by Jean Monnet (who instead believed that the starting point should be policies and that these, through a spillover effect, would lead to the creation of Community institutions). The 1957 Treaties of Rome effectively sealed and celebrated the functionalist approach. In abandoning the federalist vision (the word federation does not appear on any page of these Treaties), the countries that signed them undertook to build a common market, understood as a functionalist project to integrate Europe through economic cooperation. It is true that the Preamble to the Treaties committed the signatory countries to the pursuit of “an ever-closer union among the peoples of Europe”, but the value of this commitment seems to have been more symbolic than operational.

From 1957 to 1989-1990, the process of building a single continental market advanced smoothly, in part thanks to the enlargement of the project to new member states in Western and then Southern Europe. In this period, this market-making process was peremptorily constitutionalised by the European Court of Justice, which, through a series of significant decisions in the 1960s and 1970s, transformed the Treaties into quasi-constitutional documents. Moreover, since Europe’s economic integration was found to produce widespread benefits in the countries participating in the unification project, the process was able to advance, unimpeded, on the basis of a form of stable consensus, known as passive (or permissive) consensus. In the context of this evolving common market (re-named the single market with the passing of the 1986 Single European Act), there followed a progressive consolidation of the institutions that formed the community model, namely the Commission, the Council of Ministers, and then (especially following the introduction of its direct election in 1979) the European Parliament. However, it can be remarked that this market-based Europe was able to become well established because it integrated policies that carried little political importance within the single member states.

The Creation of an Intergovernmental Regime.

This state of affairs changed with the arrival of a new critical juncture, namely the period 1989-1991, which brought the end of the Cold War, the collapse of the Soviet Union, and the reunification of Germany (or, more accurately, the absorption of East Germany into West Germany). Germany’s reunification brought Europe face to face, once again, with its age-old problem: how to counterbalance the influence and power of Germany, now that the latter was once again Europe’s largest country, located at the heart of the continent and capable of wielding a level of economic and political force that France could no longer match. Whereas West Germany had been demographically on a par with France, after October 1990 (the date of German reunification), this symmetry was irretrievably lost. The reunited Germany had a population of over 81 million, as opposed to France’s 58 million. This imbalance between the two countries was very worrying for France’s leaders (so much so that the French president of the time, François Mitterrand, did not conceal his opposition to a rapid reunification of the two Germanies). France feared that Germany’s new superiority would result in the creation of political pressure within the EU institutions, starting with the European Parliament, where Germany had a larger delegation than France (even today, of the total 751 MEPs, 96 are elected in Germany and 74 in France).

In order to address this German asymmetry, Europe, through the 1992 Maastricht Treaty, resumed its plan (already developed in the second half of the 1980s) to build a common currency, the aim being to contain Germany’s economic might within a new decision-making framework (the so-called eurozone). The eurozone was designed to operate supranationally, in the field of monetary policy (through the European Central Bank, a newly created, quasi-federal institution), but also intergovernmentally, in that of economic policy (with all decisions being placed under the control of the national governments, whose activity would be coordinated within the Council of Ministers and, increasingly, within the European Council). In this way, the Maastricht Treaty effectively extended to the area of eurozone economic policy the intergovernmental decision-making logic that had already been introduced and institutionalised (from Maastricht onwards under a three-pillar structure) for those policy areas (foreign policy, defence, internal law and justice) traditionally considered central to the conservation of national sovereignty (the so-called state powers). Under this arrangement, whereas the supranational approach (Community method) used for deciding the single market’s regulatory policies was based on majority voting (qualified in the Council of Ministers and absolute in the European Parliament), decisions on new policies (also defined strategic policies), drawn up according to the intergovernmental method, instead demanded unanimity (both in the Council of Ministers and in the European Council), with every national government granted the power of veto. Furthermore, whereas the integration of the single market was designed to advance through the approval of laws (mainly directives and regulations), integration within the area of strategic policies was to be achieved through voluntary coordination among the national governments. Accordingly, within this decision-making system (intergovernmental), which was based not on the approval of laws but on political decisions made by national governments, the European Court of Justice, which exercised and still exercises a crucial supervisory role vis-à-vis laws relating to the single market, saw its role diminished. Similarly, both the European Parliament and the Commission, bodies linked to the legislative process, also saw their powers and role reduced.

The 1992 Maastricht Treaty may thus be taken to represent the institutionalisation of two constitutional models (i.e. decision-making systems), supranational for the single market and intergovernmental for strategic policies. By institutionalising an intergovernmental system for deciding those policies likely to carry considerable political weight within the member states, this Treaty closed the second critical juncture, or window of opportunity. It established an intergovernmental union, but did not affect the existing supranational one, in the sense that it systematised decision making on policies different from those regulated by the supranational system. In short, it sealed and celebrated a compromise between the states, which were willing to accept both constitutional models. Any union of states is, of course, necessarily based on inter-state compromises. But in the case of the European Union, these compromises were made in the absence of formally established constitutional guidelines. One need only consider that, as well as the compromise between the supranationalists and the supporters of intergovernmentalism, a compromise was also reached between the countries choosing to adopt the single currency and the ones authorised (through the opt-out formula) to remain outside the euro area, such as the United Kingdom, Denmark and, in effect, Sweden. Moreover, with the subsequent and successive enlargements of the EU, the number of countries opting out has increased, even though, formally, new member states are obliged to converge economically towards the standards of the single currency. And of course, we must not forget the compromise reached, within the eurozone, between Germany, which pressed for centralisation of monetary policy under the European Central Bank, and France, which insisted that economic and fiscal policy remain decentralised to the member states.

The Multiple Crises of the Past Decade.

The 2008 financial crisis marked the start of a third, and decade-long, critical juncture. Indeed, it was followed by a migratory crisis and then a security crisis, and these multiple emergencies shook the post-Maastricht institutional structure to its core. As a result, the compromise between the two visions of Europe (based respectively on supranational market integration and intergovernmental cooperation) was undermined, with the latter emerging as stronger. The compromise that had been reached between the wishes of countries committed to an “ever closer union” and those instead interested solely in the economic union was also weakened, to the point of triggering centrifugal processes. Indeed, one of the opt-out countries even decided, on the basis of a popular referendum (the so-called Brexit referendum of June 2016), to leave the European Union. Furthermore, in this context, the compromise reached within the eurozone (i.e. centralisation of monetary policy and decentralisation of economic and fiscal policy) fostered increasing division between the continent’s northern and southern states, partly as an effect of the affirmation of Germany and its economic vision (ordoliberalism). Germany, finding that it had become too strong to be counterbalanced by France and could thus exercise unchallenged leadership within the eurozone, was induced by its position of strength to change its traditional stance on European integration: it began favouring an increasingly intergovernmental vision, thereby moving away from the supranational one it had espoused in the period before October 1990.

The upsetting of these compromises brought to the surface the different visions that, historically, underlie the EU member states’ attitudes towards the integration process. Indeed, because the federal moment mentioned by Giulia Rossolillo (the moment that, ideally, should have established the nature of the European Union at its birth) had never materialised, the member states ended up developing different, and irreconcilable, views of European integration. This explains why there emerged a group of countries (the UK plus the countries of the Scandinavian peninsula and of Eastern Europe) that reacted to the multiple crises by calling for a return towards exclusively economic integration, i.e., a pre-Maastricht-like integrated market reconcilable with the preservation of national sovereignty (and thus compatible with the nationalisms that characterise these countries). It should be noted that in the UK and Denmark, for example, nationalism has continued to have a democratic character, whereas this is not the case in many Eastern European countries. One need only consider the current decline of the rule of law in Poland, Hungary and other countries in this area. These are countries where nationalism is even assuming religious overtones, probably as an effect their enforced loss of identity under Soviet rule. But at the same time, however, another group of countries (those making up the “core” of the eurozone) had an opposite reaction to the crises, instead calling for a leap forward in the integration process, so as to arrive, in the words of French president Emmanuel Macron (elected in May 2017), at “a sovereign, united and democratic Europe”. This is a group of countries that has never ceased to interpret the concept of “ever closer union” in political terms, and indeed never could do. After all, they are the ones for which nationalism has, historically, been an enemy of democracy — countries that, between the two World Wars, saw their democracies wiped out by nationalism. The multiple crises of the past decade have brought to the fore, to an unprecedented degree, this split, or difference in visions (between an economic Europe and a political Europe).

Among the supporters of a political vision there emerged, as the crises unfolded, a further split, namely between those that wanted a parliamentary form of political union (countries like Italy and Spain, and EU institutions like the European Parliament and the Commission), and those that instead preferred an intergovernmental form (countries such as pre-Macron France and Germany, as well as the Council of Ministers and the European Council).

The main supporters of the parliamentary perspective (which derives from functionalism and can be defined more accurately as the parliamentary union perspective) are the Commission and the European Parliament, which together represent the inter-institutional axis that has supported, and must inevitably continue to support, integration through law. Those who adhere to this perspective therefore backed the Spitzenkandidaten process for the 2014 European parliamentary elections, and will do so again for the forthcoming 2019 elections. Instead, the intergovernmental perspective (which derives from liberal intergovernmentalism and can be defined more accurately as the intergovernmental union perspective) is championed by the European Council and the Council of Ministers, the inter-institutional axis that has supported, and must inevitably continue to support, integration through coordination of national governments participating on a voluntary basis. Both these perspectives have shown themselves to be entirely one-sided. The parliamentary one underestimates the role of national governments, while the intergovernmental one fails to take due account of the role of European citizens. And yet it is unthinkable that the governance of a political union (made up of states and of citizens) can be consolidated without arriving at a balanced combination of the two, necessarily within a different and original institutional framework.

In short, the multiple crises of the past decade have highlighted the difficult coexistence between the vision of the European Union as an economic community and the one that would have it transformed into a political union. At the same time, they have exposed the institutional weakness of the two main forms of governance: parliamentary and intergovernmental. For some EU countries, like our own (Italy), but also other continental countries, Europe’s economic community may not be sufficient to safeguard national democracy and meet the challenges of a globalised world. For other countries, on the other hand, the economic community represents the only possible form of integration, being the only one considered compatible with their nationalist outlooks. However, even these countries must acknowledge that secession is not a feasible way of managing European interdependence. The difficulties being encountered by Theresa May in seeking to manage the effects of Brexit are proof that, in Europe, the nation-states have become member states of an interdependent system. It is not possible for a country to withdraw from interdependence and return to its condition of a century ago. Instead, interdependence needs to be governed, and this means finding differentiated solutions for groups of countries that favour different models of integration.

Towards Federal Union.

But what solutions? At this point, we can only return to the federalism that was abandoned in the 1950s. This must be understood (in accordance with James Madison’s teaching) as a method of organising inter-state relations that takes into account demographic asymmetries and different national identities. First of all, in an institutional sense, we need to separate (distinguish between) the economic community and the political union. The next step is to ask what kind of political union can cater for asymmetrical and differentiated states, and keep them all on board. To answer this question, we need to start conceiving of unions of states in federal terms once again, bearing in mind that unions of states that become federal follow a different logic from unitary (non-aggregated) states that become federal. Empirically speaking, federalism is a “genus” that includes different species, two in particular: one is federalism by disaggregation (which gives rise to federal states) and the other is federalism by aggregation (which gives rise to federal unions). The first type of federalism is exemplified by the experience of post-war Germany, an experience that has influenced many pro-European parliamentarians, but simply could not work in Europe because of the EU member states’ fundamental demographic and national asymmetries.

The second type of federalism, namely that of asymmetrical and differentiated states aggregating for various reasons (generally to guarantee their mutual security), is illustrated by the experience of the United States. The world has thus far seen two federal aggregations that have been democratic success stories (the US and the Swiss federations), and it can be noted that both of these began with a founding act — a constitutional act. The leaders of the (American) states and (Swiss) cantons made the federal leap, in other words they jointly developed and approved the constitutional act through which their respective unions came into being. They succeeded in doing this because they adopted a federal system that allowed them to resolve the paradox of building a sovereign union of sovereign states, namely the multiple separation of powers that characterises both these unions. In short, sovereignty was broken down and redistributed, and clear dividing lines were set between federal (or supranational) and state (or national) powers. Indeed, contrary to what we see in the EU with organs such as the European Council, unions based on the separation of powers do not run the risk of having a political governing body made up of national heads of government who may have been elected on the basis of their opposition to integration. In this regard, we might think, for example, of the prime ministers of Eastern Europe, or the possibility of Marine Le Pen becoming president of France and therefore a member of the European Council, Europe’s political governing body. That is like thinking of George Wallace, the racist governor of Alabama who served three terms in the 1960s and 1970s, becoming, on account of this position, a member of the United States federal executive and thus contributing to the definition of federal strategies.

For these reasons, Europe’s political union (to be built starting with the countries of the eurozone) must be created as a union, and not born of a pre-existing state. It must be based on a method of governance that reflects the division of sovereignty. Indeed, it is not a question of concentrating sovereignty (meaning decision-making power) in the European Parliament or in the European Council, but rather of creating separate institutions that share the same power of government. Political unions of asymmetrical and differentiated states cannot have either a state apparatus or a government (in the sense of an institution). Any and every process of centralisation would strengthen the stronger and larger states to the detriment of the smaller and weaker ones. Within these unions, government must be seen as a process and not a body: a process structured around independent institutions that, precisely for this reason, balance each other out.

At the same time, a political union made up of states having different national identities does not marry with the idea of a federal state that absorbs (and thus subordinates to itself) the various national identities of the single states of which it is formed (as in the case of the German federal state, or Bundesland). Europe’s nation-states cannot be likened to the German Länder or to Canada’s provinces. And even if they could, what national identity should the hypothetical European federal state convey? That of the larger and stronger member states? Essentially, to exist, a political union of asymmetrical and differentiated states needs a constitution; it does not need to be a state. And this constitution, devoid of cultural, religious or national value, must constitute its founding political pact. Political unions of asymmetrical and differentiated states are held together by politics, not pre-political premises. They stay together because they accept the basic democratic values and the basic rules that are necessary for reaching joint decisions in their (few) areas of common interest. The division of sovereignty and the separation of the different levels and institutions of government have the dual and simultaneous effect of preserving national democracies and creating a supranational democracy, as each level has different responsibilities to manage and policies to decide. Democracy can be seen as the glue that binds together political unions of states and citizens that want to hold onto their identities and retain their original dimensions. I am talking about independent unions of independent states, to use Mario Albertini’s expression, or what Jacques Delors called federations of nation-states. We need a new paradigm for planning the future of Europe, a paradigm based on different and separate levels and institutions of government. We need a method that will allow us to find original solutions to the issues raised by Europe’s specific experience — a method that only democratic federalism can provide.

* This is the text of a presentation delivered at the conference entitled Il federalismo europeo e la politica del XXI secolo: l’attualità del pensiero di Mario Albertini (European federalism and 21st century politics: the relevance of the thought of Mario Albertini), held at the University of Pavia on 16 November, 2017.

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