The EU explained pt. 2: What the EU does

One half of the European Union’s (more precisely, the European Commission’s) role is to create new laws and help Member States complete the internal market. The other involves carrying out different kinds of jobs and helps explain what the civil servants in the European Commission do.

It can be quite hard to define where the European Union begins and ends as it isn’t immediately visible to the average citizen in the same way that national and local entities are. Imagine that with a snap of the fingers that any of these three levels of government (local, national or European) were to disappear. National and local authorities provide services like health care and rubbish collection; their sudden disappearance would be felt near instantaneously. They contain services that define our societies and communities. By contrast, the disappearance of the EU would take slightly longer to effect the population, resulting in economic instability as prices adjust. The EU holds elements of our economy that are recoverable and more high minded ideas, such as being sustainable or promoting human rights.

A basic definition of what the EU does might come from its motives: to act when either a national response is inadequate (like climate change) or bigger is better (like a single trade policy).

In practice, the EU acts in almost every aspect of politics as Member States feel they have more to gain by working together than individually. However, it doesn’t act instead of Member States, but as an extension. A phrase at the start of the Lisbon Treaty (the central text used to govern the EU) is useful, though it has had quite a bit of negative publicity recently.

Resolved to continue the process of creating an ever closer union among the peoples of Europe, in which decisions are taken as closely as possible to the citizen in accordance with the principle of subsidiarity.

David Cameron has used this phrase recently as part of his promise to renegotiate the UK’s relationship with the EU. Specifically, he’d like an opt-out for the UK from the ‘ever closer union’ part. Aside from the fact that this phrase holds no legal weight or requirement in itself, making his point invalid, he (quite conveniently) leaves out the qualifying clause (in bold).

In short, it says that governance and public services work best when closest to citizens. Work only takes place at the higher levels when necessary. To return to the example of rubbish collection, it’s easy to see how local, national and European levels of government influence what happens.

Obviously, rubbish collection is best left to the local authorities to handle, either collecting waste themselves or tendering the service out to the private sector. To organise this from a European, or even national level, would be absurd. However, we generate so much rubbish that some kind of national strategy is needed to handle it and work out how to deal with the waste. The European level only comes in when it can add value. In this case it’s a place where the Member States can share best practices and set goals for waste reduction to tackle climate change at the global level.

It’s when issues cross borders (e.g. pollution/ climate change) that the EU appropriately steps in. Competition law is another example of this. Every Member State has their own competition authority that is there to make sure that there is a fair market for goods, products and services; stopping monopolies or cartel activity, etc. There is also an authority at the EU level, which deals with cross border issues.

Comp authority

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If a number of companies run a cartel to fix prices in one country, the national authority investigates. If the price fixing affects a number of countries then it’s the job of the European competition authority, as the authorities of the Member States have no jurisdiction in the other countries.

This model applies to other areas of regulation. For example, Uber has recently arrived in the EU. A few countries have not taken kindly to the app setting up in their cities and have moved to ban it. Uber has complained to the European Commission and although it is an issue in Member States, it is not an issue across Member States and the European Commission has declined to take action.

Only on one or two occasions have Member States decided to push a policy almost entirely to the EU level. One such example is in agriculture policy, specifically, agricultural subsidies.

CAP

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There are strong views on these subsidies but they demonstrate how the internal market works. It was decided that farmers should receive support for their work as it is very important; this takes the form of subsidies. However, if the farmers’ subsidised (and therefore cheaper) produce can be sold in other countries then governments could increase subsidies to boost demand for their produce abroad and spur economic activity at home. Unless subsidies are co-ordinated or jointly set, it creates an uneven market place and leads to competition between Member States over ‘who loves their farmers more?’

Agricultural policy is officially called the ‘Common Agricultural Policy’ and is just about the only EU policy that is truly common; no Member State opts out, all taking money from a combined pot. In other areas, it’s a mix, with Member States and the EU cooperating as and when is appropriate, keeping things as close to the citizens as possible.

The EU explained pt. 1: decision structures

The EU has become a central attraction of British politics recently and, happily, this means that hours spent pouring over EU textbooks can be put to good use. Sadly, much of what is said is misleading, inaccurate or, at times, nonsensical. Over the space of a few blog posts I’ll outline a few key features of the EU, favouring simplification and the essentials.

The structure of the EU and the primary decision making structures is a good place to start and the punchline is that the buck stops with the Member States. At its core, the EU is a collection of countries that have decided to form a club and nothing happens within the club without their say-so. When you read about ‘Brussels’ doing something bad, remember that your government agreed to it.

The most obvious way we can see this by looking at who sits at the top of the pyramid.


Structure

Although the EU is quite a unique organisation, it still looks like other governance structures. Having had five constitutions, the French are expert at creating these sorts of things and a simplified version of the current setup is useful to glance at as all the parts are neatly separated.

In the diagram below, the French President sits at the top. They then appoint the Prime Minister who is in charge of the executive and forms a cabinet composed of ministers, each with their own portfolio (defence, health etc.). The cabinet heads the government, which runs the civil service and proposes new laws to the legislature. In France, the legislature is made up of an upper chamber called the Senate and a lower Chamber called the National Assembly. Both are elected, albeit in different ways, and the Prime Minister needs their support to form the government. Together these chambers also vote on proposals from the government, which become law; they also do other things to help run the country.

FR gov

This is a very clean and tidy system of government and it’s quite useful for understanding how the EU works, which roughly matches up to the French system.

Below are the EU institutions, which match up with the French government. At the very top is the European Council, which is made up of the Presidents or Prime Ministers of the EU members. They appoint the President of the Commission who hands out portfolios to the College of Commissioners. The Commissioners take charge of the EU civil service and propose new laws to the legislature. In the case of the EU, this consists of an upper chamber, called the Council of Ministers and a lower chamber, the European Parliament. The Council of Ministers is made up of the Member States and the Parliament has directly elected Members. Together these chambers vote on proposals from the Commission and help run the EU. The President of the Commission also needs the support of the Parliament to form his College.

EU gov

Two structures for decision making

With this structure in mind, decision making in the EU becomes more obvious. All too often it’s simply reported that new legislation comes ‘from Brussels’. This isn’t a good sign and is #1 on Kosmopolit’s Short guide to lazy EU journalismBroadly speaking, there are two systems for making decisions, used when it is either to do with the internal or not to do with the internal market.

The internal market refers to treating the free markets of all Member States as one large market. The idea is that together, the EU can take advantage of economies of scale. Decision making for this is to do with things like environmental standards, consumer protection and financial regulation.

Things that aren’t the internal market: defence, foreign affairs, contributions to the EU budget, taxes, health, education, policing.

A final similarity with the hijacked French system is how the Prime Minister is responsible for many issues but the President reserves the right to take charge in things like defence and foreign affairs. In the case of the EU, this reflects the ‘internal market – not internal market’ divide.

EU FR side

To return to the diagram of the EU, it’s clear that all of the parts come into play when decisions concern the internal market.

Let’s say the European Council decides it wants to do something about global warming. As a result, the European Commission might come up with a proposal to reduce electricity consumption and spur innovation by limiting how powerful vacuum cleaners can be. This proposal is then handed to the Parliament and the Council, which make any changes they’d like to see before agreeing a final text between them, which then becomes law. This is the structure on the left.

EU 2 systems

When what’s being discussed doesn’t refer to the internal market, the other system is in play. Consider that thinly disguised Russian troops take over a region of a sovereign neighbouring state and annex it as part of Russia. This isn’t to do with the internal market so the Commission and Parliament play a smaller role. In this case, work happens almost exclusively in the European Council and the Council of Ministers; the other institutions providing advice, input and expertise where relevant. Typically Member States in the Council of Ministers will need to all agree on a position for ‘the EU’ to take action, otherwise a few Member States use it as a chance to coordinate their efforts. This is the structure on the right in the above diagram.

He who pays the piper, calls the tune

The European Commission is often painted as all powerful and the fact that it gets to propose new legislation shouldn’t be down played. However, when it comes to the internal market, whatever it puts forward has to be approved by the Council of Ministers and the European Parliament. It isn’t in the interest for the European Commission to propose something that is wildly different from what the other parts want to see. In particular, the European Commission needs to please the Member States. The European Council and the Council of Ministers pay the bills and hold ultimate sovereignty.

It’s true that there are many more nuances to the setup than are outlined here but this is a striped back explanation. The bottom line is that if something ‘comes out of Brussels’, it’s more than likely that every government agreed to it and it’s to them that people should complain.

Is gay marriage bad for marriage?

Following the coverage of the gay marriage debate in Commons, and only hearing those on the side of the status quo defend themselves from being called bigots and nazis, I went looking for arguments in favour of ‘preserving marriage’.

Sure enough I came across c4m.org.uk and their 10 Reasons Why the Government is Wrong to Redefine Marriage. Not having an unlimited amount of time, I decided to only dissect the first argument  on their list; the exact text reads:

Evidence shows that redefining marriage actually undermines support for marriage in wider society. Neither has it delivered the promised stability for same-sex couples. In Spain, after gay marriage was introduced, marriage rates across the whole population plummeted. In the Netherlands too there has been a significant fall in the marriage rate since marriage was redefined. Same-sex marriage does not promote marriage.

Although there are a few statements in there (many that I take issue with), the thrust of the argument is that by looking at data from Spain & Holland, where gay marriage has been legalised, we see a falling number of marriages. This is due to said legalisation and we can therefore conclude that support for marriage is also falling.

The first point to make is that for this to be correct, the only way to support marriage is to be getting married. The figures only count marriages that take place, so anyone that is already married needs to get married again for their support to be registered.

What’s more, anyone not getting married after the legalisation of gay marriage does so because they do not believe in marriage. This decision has nothing to do with not having found someone to marry or not having enough money to do so.

However, I decided not to focus on the logic of the text (lack thereof?) and go hunting for the statistics.

Helpfully, the article does reference the Spanish [in Spanish] and Dutch figures, which means we can take a look at them.

España

Beginning with the Spanish figures, we can see that, since 2005 there has indeed been a decline in the number of marriages. But this is also true of the numbers since 2004, and in fact since 1989. So one could argue that this is part of a larger trend.

But even that is a simplification – between 1986 and 2007 we can see the figures rising and falling between 200,000 and 220,000. It is only after 2008 that the number of marriages really drops off. Exactly around the time of the financial crisis.

So what about the Dutch figures?

Nederland

Well yes, since 2001 when gay marriage was legalised, the number of weddings has fallen from 82,000 to 71,500. But again this doesn’t take into account fluctuations like an increase to 86,000 in 2002, or slight jumps in 2008 and 2010. So there hasn’t just been a steady decline.

What’s more, the figures show a decline of 6,000 between 2000 and 2001. So once again, whatever the reason for the decline, I might easily argue that it began before gay marriage.

But what of other countries that have legalised gay marriage? After hunting for the statistics for Canada and Argentina (to no avail), I came across the figures for South Africa and Belgium [in French – 1st .xls on the right] (which go right back to 1830!).

South Africa

For South Africa (gay marriage legalised 2006), the report I came across cites the 10 year period 2001-2010, that the year with the lowest number of marriages was 2001. In 2010 the figure stood at 171,000 (up from 135,000 in 2001), and so it might be argued (by c4m.org.uk’s logic) that gay marriage has increased support for marriage.

Belgique

In Belgium the figures show a steady increase in marriages from 2003 (gay marriage legalised) until 2008, when they dropped slightly to 2001 levels to put them in line with a decline that has been taking place for far longer.

The figures from all four of these countries hardly demonstrate compelling evidence that gay marriage undermines support for marriage.

In order to explain any decline/ increase in marriages would be to do a far more thorough investigation and analysis of a huge range of factors.

And even then, you still wouldn’t have proved the link between the number of marriages and support for them.

Bereavement more likely than divorce.

Way back in 2010 when the coalition agreement was put together, it seemed like every political commentator was clamouring to discuss the ‘fact’ that ‘British politics doesn’t do coalitions’. And claim that sooner, rather than later, it would all break down.

Two and a bit years later, the divorce still hasn’t happened; in my opinion it won’t because the Lib Dems stand to lose too much if it does break down – a central plank of their beliefs is that governance by coalition (proportional representation) is better than simple majority governments. Therefore, a breakdown in the coalition would mean that they’re wrong, and spell the end of any sort of chance for them in the future.

So divorce is pretty unlikely.

On Friday, Chief Political Correspondent for the Guardian, Nicholas Watt wrote a piece outlining the size of the Tory’s europhobic headache migraine, and it honestly seems to me that the reason for the current coalition falling apart is now more likely to be that the Tory Party simply implodes

Making the most of the British ego.

On my way to go shopping today, I was sadden to see that the UKIP sign urging motorists to ‘say no to the Euro’ has been renewed (not that anyone is asking). Although it was saddening because it reminded me of the strength of europhobic sentiments in the UK, it also reminded me of the fact that Britain’s relationship is almost exclusively based around economics.

 

It seems that Britain’s cooperation in the European project is a zero-sum game, whereby the appearance of any red in our column will spell the end of our involvement. While no other EU member would want to lose out economically, their equations are more complex. Their reasons for being involved with the EU do not boil down to money.

 

For instance, Spain and Greece need look back no further than 40 years into their histories to find themselves under the rule of dictators. While most of the Eastern European EU members need look just a little more than 12 years to see themselves being dominated by the USSR. Both these factors figure heavily in their decision to be EU members. 

 

The obvious point to make here is that Britain lacks any ‘heart’ for wanting to join, but what we might find is a new way of selling the EU to the British – by appealing to vanity.

 

For all its faults, Britain is democratic, secure, and has a (mostly) working economic model. These are attributes that other EU nations seek to emulate, and are why other states want us playing a large role within the EU. As much was made plain in a recent BBC Radio 4 documentary, Europe Moves East.

 

Although we gave up on our empire quite some time ago, much of Britain still holds the image of a world power in its mind. By emphasising our image within Europe as a leading light, we might convince  the British public that there’s more to the EU than the rebate. Indeed for many Eastern european member states, the EU forms “the bedrock for their infant democracies, and their security.”

EU reform is good but we need understanding.

It wasn’t as bad as I thought it was going to be, is about the best I can say of Ed Miliband’s speech to the CBI conference this week. I’d expected a damp squib of a performance, when in fact he came off as capable. And though I wouldn’t exactly describe his pro-EU arguments as new, they are at least cogent. His strategy is essentially to focus on reforming the EU and win over eurospectics. However, I don’t think it is as simple as that.

What is needed, is a genuine change in the media narrative surrounding the EU. For many British newspapers, the EU is the piñata from which sweets continue to fall, every time they flog it. So it’s no surprise that euroscepticism is on the rise. At best, I’d describe EU coverage as misleading, and the EU itself sees it as such an issue that they’ve gone to the trouble of devoting an entire blog to disprove anti-EU stories.

Part of fixing this first problem is that we need a greater understanding of firstly, what the EU is, and secondly, what the EU does; a problem demonstrated by the CBI speech. Admitting that the EU isn’t perfect and requires reform is part of Miliband’s new strategy (and rightly so), citing the EU-wide unemployment level of 25 million as evidence. However, this gives the misleading idea that the EU itself is to blame for such a figure. In actual fact, there could be a multitude of reasons for arriving at this number, but in the mind of the public it portrays the EU firmly as the bad guy. In short, the woes of European nation states cannot be automatically attributed to the European Union.

The other part of Miliband’s policy that I take issue with, is his call to cut the EU budget. While I agree that in hard economic times we should not see a dramatic rise, this should not mean we cut it. By that logic, once we return to growth, the EU budget should increase. It’s worth keeping in mind that the budget will run until 2020, which is quite a few years after our elected representatives will have presumably returned us to economic growth. Unless of course the politicians have no faith in their leadership.

Reith 2012: Ferguson’s Rules of Law (and his enemies)

A few days ago, I finally got round to listening to the last of this year’s Reith Lectures given by Niall Ferguson. During his quartet of lectures, titled The Rule of Law and its Enemies, he has aimed, as he said, to unlock the black boxes of democracy, capitalism (not that I’d say this needed unlocking), the rule of law, and civil society.

 

I found the lectures highly enjoyable and easy to follow and understand. First Ferguson would give a historical background, from which he then reasons his argument. And at just 25-30mins long each, followed by a Q&A session, not having enough time is hardly an excuse to avoid them.

 

He posits this year’s series on looking what has gone wrong in the West, that it is no longer the outright leader of the world. As evidence he cites the figure that the average American is now only x5 richer than the average Chinese (rather than x20 not long ago) and as a method of understanding this ‘fall’, he takes a look at the institutions/ areas mentioned above. Although I don’t entirely agree with the idea that the West’s decline in power is a direct result of an actual decline (more than as a result of the rise of the rest), it is still very much worth hearing him out.

 A mountain to crush the future

That said, in his first lecture, Ferguson did address one issue with which can definitely be held up as decline, our accumulation of public debt. This should not be confused with the current debate surrounding the deficit, the yearly amount our government overspends. Although this and the rate it should be cut is important, Ferguson focuses on the already established debt mountain, adding with it that future liabilities in the form of pensions and social care will form a crushing burden for future generations. He offers the American figure of $200tn as the different between current Federal liabilities and future Federal revenues in the USA. This surely strikes fear into the hearts anyone concerned with the future, and Ferguson adds that this is not even a complete figure.

 

This landscape can be viewed in just about every Western country and results from our current society living beyond its means, at the expense of future generations. This represents a breaking of the social contract laid out by, not Rousseau, but Edmund Burke. That of a social contract between the living, the dead, and the not yet born. Ferguson argues that failure to redress this imbalance will result in a pursuit of Mediterranean countries down a spiral of tax rises, spending cuts and a loss of credibility. Restoring the intergenerational contract is the West’s biggest challenge.

 The flow of capital under the law

In his next two lectures, Ferguson focuses on finance and the importance of the rule of law. On finance he argues that what is needed in order to reform the financial sector now, is not complex regulation (which will more than likely stifle the industry) but greater punishment and better oversight. Here again I find myself agreeing with him – after all, it seems that when the bankers have decided whether to undertake risky investments or break any laws, after balancing the risks, they still decide to go ahead. Far more severe punishments and robust supervision would go a long way to reforming banking culture.

 

Regarding the rule of law, Ferguson highlighted the importance of law in encouraging economic activity, and as a result actually spent quite some time talking about China. Necessary for further Chinese development, he says, is that the Chinese Communist Party establish itself as a legal entity (the reasons for which can be found in the lecture), and that the 150,000 or so lawyers in China, form quite a positive force for political change.

An educational cure

It’s Ferguson’s final lecture in the series where I find myself in greatest disagreement though. The talk is ostensibly about civil society, participation in which Ferguson describes as in decline (he does provide evidence, though this is contested in the Q&A). However, he spends what seems like the majority of his time speaking about the benefits of an expansion of private and independent secondary education, together with increasing the number of bursaries available to students from less well-off background and a voucher system. While a state monopoly is good at providing basic education, he argues, it is not good at providing a good education. Ferguson describes this as a plea for ‘biodiversity’ in the system.

 

In support of his prescription, he quotes statistics from the OECD’s PISA survey of education, citing our ‘poor’ performance. And the impressive turn arounds at many failing schools after gaining academy status. What’s more, he cites the promising progress that Toby Young is reporting at his West London Free School and the exam result triumph of the Success Academy in Harlem, New York. For a fuller outline of his argument, it’s probably best just to listen to the lecture.

 

And while I do (again) find myself in agreement with Ferguson that a higher level of independence for the schools is a good thing, I don’t agree that an influx of private schools into the system will help matters. In fact I disagree that private education system is necessarily better than state.

 

Firstly, I’m not convinced that the logistics of the move would work out – for the most part, our population doesn’t have the money to send their children to a private school, and for the state to pay for a voucher system would appear to be very expensive; an odd suggestion for someone who earlier advocated the rebalancing of public finances.

 

Secondly, if you were to consult the PISA results (handily available via Google) I would highlight Sweden & Denmark. Ferguson singles these countries out for praise as leaders in education reform that has enabled more children to attend private schools, though their PISA results peg them about level with the UK. Granted, it may be that the policy hasn’t had enough time to take effect but even if that’s so, that would mean it’s still too earlier to judge the success of the scheme.

 

A better direction for reform, it would seem, is to look at how often & when we test students, what subjects & options for study students have, and how much support is given to teachers (small, fewer classes & longer training). In short, the system to look at is Finland’s. I first heard about Finland’s education earlier this year by watching a documentary called The Finland Phenomenon. Finland’s system differs from others for many reasons – no private schools, no standardised tests, no homework, no league tables, schooling beginning at 7 – and yet it ranks 1st in pretty much every PISA category.

 

So I can’t agree with Ferguson on the expansion of the private sector education, especially when so, so many other people are cheering on alternate possibilities.


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