Benjamin Disraeli once called a conservative government “an organized hypocrisy.” Perhaps the best thing we can hope for is that the same will one day be said of “liberated” Iraq. A formal return to Iraqi self-government clearly had to be announced in 2004. But there also needed to be continuing limitations on the country’s sovereignty in order to ensure economic recovery, internal political stability and the future security of those countries Iraq once menaced.76 Ambassador Negroponte must be prepared to be Iraq’s Lord Cromer, viceroy in all but name for decades. And if no American wants the job after 2005, we may be reasonably sure that under the right terms and conditions a European will volunteer.
In an important but underreported speech he gave in June 2003, the former leader of the British Liberal Democrat Party, Paddy Ashdown, reflected on the “principles of peacemaking” he had learned in his capacity as high representative in Bosnia and Herzegovina (a post created by the Dayton peace accords). His seven principles were as follows:
[To have] a good plan and stick to it. This plan needs to be drawn up, not as an after-thought, but well in advance, as an integral part of the planning for the military campaign.
[To] establish the rule of law—and do so as quickly as possible…. It is much more important to establish the rule of law quickly than to establish democracy quickly. Because without the former, the latter is soon undermined.
[To] establish your credibility straight away. The more robustly a peacekeeping force deals with any initial challenges to its authority, the fewer challenges there will be in the future.
To start as quickly as possible on the major structural reforms—from putting in place a customs service or reliable tax base, to reforming the police and the civil service, to restructuring and screening the judiciary, to transforming the armed forces.
[To ensure] that the international community organizes itself in [the] theatre in a manner that can work and take decisions.
[To establish] an exceptionally close relationship between the military and civilian aspects of peace implementation.
[To] avoid setting deadlines, and settle in for the long haul…. In-stalling the software of a free and open society is a slow business. It cannot be done … in a year or so…. Peace-keeping needs to be measured not in months but decades. What we need here … is “sticktoitiveness” … the political will, the unity of purpose, and the sheer stamina as an international community to see the job through to lasting success. That means staying on, and sticking at it, long after the CNN effect has passed.77
There is wisdom in all seven of Ashdown’s principles, above all the last one. It is nevertheless significant that such sentiments could be expressed more easily by a Briton running an international protectorate in a European country than by an American running a provisional authority in a Middle Eastern one. No less noteworthy was Ashdown’s eighth and final principle:
8. [To give] peace-building … a political destination. For Iraq, that may be a democratic and prosperous state in a peaceful and secure Middle East. For Bosnia, it is Europe.
It is time now to consider just how plausible a “political destination” Europe actually is, not just for Bosnia but also for all the actual and potential members of the European Union. For if any counterweight currently exists in the world to the power of the United States, it is the European Union.
Chapter 7
“Impire”: Europe Between Brussels and Byzantium
A EUROPEAN DREAM NOW BECOMES REALITY.
International Herald Tribune headline, 2001
COUNTERWEIGHT?
There is a plausible role for the European Union as the partner of an American empire: the peacekeeper that follows in the wake of the peacemaker. The war in Iraq, however, raised the possibility of a diametrically different role for Europe: as a potential imperial rival to the United States. This is a role that Europe’s political leaders would much prefer to play. The French president Jacques Chirac is said by a former adviser to want “a multipolar world in which Europe is the counterweight to American political and military power.” The former German chancellor Helmut Schmidt has declared that his country and France “share a common interest in not delivering ourselves into the hegemony of our mighty ally, the United States.”1 In a speech in October 2002, the EU commissioner for external affairs Chris Patten explicitly called for Europe to become “a serious player … a serious counterweight and counterpart to the United States.”2 And the Italian prime minister Silvio Berlusconi declared on the eve of taking over the EU presidency in July 2003 that “Europe will only be able to look at the United States as something other than a subordinate if it becomes a great Europe.”3 Even that most subtle of British commentators Timothy Garton Ash has lately found himself yearning for a more globally assertive Europe. “America,” he argued in the New York Times in April 2002, “has too much power for anyone’s good, including its own.”4
In economic terms, China may conceivably catch up with the United States at some point in the next forty years. But for the present only the European Union comes close to matching U.S. output. The solution— presumably for everyone’s good, but certainly for Europe’s—must therefore be for the EU to become more politically powerful, to punch its economic weight. Such sentiments have been expressed with increasing frequency since the Anglo-American invasion of Iraq.
In the eyes of many commentators, that was precisely the aim of the new Treaty Establishing the Constitution of the European Union, drafted by the former French president Valéry Giscard d’Estaing’s European Convention and submitted in June 2003 to the European Council in Thessa-loniki. Consider what the treaty has to say on the subject of Europe’s military power. Article I-11, clause 4, explicitly declares: “The Union shall have competence to define and implement a common foreign and security policy, including the progressive framing of a common defense policy.” Article I40, clause 3, states “that Member States shall make civilian and military capabilities available to the Union for the implementation of the common security and defense policy” and that they shall also “undertake progressively to improve their military capabilities.”5 While British Euroskeptics have focused, predictably, on the cryptofederalist aspects of the draft treaty, some American commentators have seen it as the latest manifestation of Europe’s “anti-American” tendency. “There is only one rationale for such a proposal at this time,” according to the journalist Andrew Sullivan, and that is “to check U.S. power.” When Giscard d’Estaing himself says that he wants the EU to be “respected and listened to as a political power that will speak as an equal with the largest powers on the planet,” that does seem a plausible inference.6
Of course, this kind of talk elicits nothing more than derision in some quarters. In his popular polemic on the subject, Robert Kagan has heaped scorn on the “relative weakness” of Europeans, in contrast to the martial vigor of Americans. “Europe’s military weakness,” Kagan argues, “has produced a perfectly understandable aversion to the exercise of military power. Indeed, it has produced a powerful European interest in inhabiting a world where strength doesn’t matter…. [But] Europe’s rejection of power pol- itics, [and] its devaluing of military force as a tool of international relations, have depended on the presence of American military forces on European soil.”7 One could in fact go further than .Kagan. It is not just the searing experiences of two world wars that have turned Europeans from Mars to Venus. It is also the fact that in relative terms their continent is much less important than it was in the nineteenth century. Its share of world population is half what it was in 1820. Its share of world output is down to a fifth, compared with over a third in 1870. And this relative decline seems almost certain to continue in the foreseeable future. To many Americans, Europe’s principal significance these days is not as a strategic rival but as a tourist destination.8
Yet Kagan’s insistence on Europe’s weakness remains something of a minority view in the American academy. A substantial number of commentators have followed the
lead of Samuel Huntington in seeing European integration as “the single most important move” away from the “unipolar” world of the post—cold war hiatus toward a “truly multipolar” twenty-first century.9 Charles Kupchan predicts that “Europe will soon catch up with America … because it is coming together, amassing the impressive resources and intellectual capital already possessed by its constituent states. Europe’s political union is in the midst of altering the global landscape.” According to Kupchan, “a collective Europe” is “next in line” to challenge American power.10 Drawing an intriguing analogy with the ancient world, he portrays the EU as “an emerging pole, dividing the West into American and European halves.”11
The EU as the new Byzantium? Kupchan’s views are less idiosyncratic than they seem at first sight. Classical analogies have also inspired the British diplomat Robert Cooper to call for “a new kind of imperialism, one acceptable to a world of human rights and cosmopolitan values … an imperialism which, like all imperialism, aims to bring order and organization but which rests today on the voluntary principle.” Significantly, Cooper sees not the United States but the European Union as the institution best able to become such a postmodern imperium:
The postmodern E.U. offers a vision of cooperative empire, a common liberty and a common security without the ethnic domination and centralized absolutism to which past empires have been subject, but also without the ethnic exclusiveness that is the hallmark of the nation state…. A cooperative empire might be … a framework in which each has a share in the government, in which no single country dominates and in which the governing principles are not ethnic but legal. The lightest of touches will be required from the centre; the “imperial bureaucracy” must be under control, accountable, and the servant, not the master, of the commonwealth. Such an institution must be as dedicated to liberty and democracy as its constituent parts. Like Rome, this commonwealth would provide its citizens with some of its laws, some coins and the occasional road.12
There is, however, no need to invoke the memory of either Rome or Byzantium to make the case that Europe is capable of spoiling America’s unipolar party. Joseph Nye too sees Europe as already America’s equal in the economic sphere, where “the United States is not a hegemon, and must often bargain as an equal with Europe.”13 Though more perturbed by the rise of China, John Mearsheimer is also concerned by the two possible challenges to American power that he expects to emanate from Europe: “Either the U.S. will leave Europe … because it does not have to contain an emerging peer competitor, in which case the region becomes less stable, or the U.S. will stay engaged to contain a formidable rival in what is likely to be a dangerous situation.”14 The historian Paul Kennedy has added his voice to the chorus, emphasizing the demographic significance of European consolidation and enlargement. “Even now,” he wrote on the first anniversary of the terrorist attacks of September 2001, “[Europe] has a substantially larger population than has the United States … and a roughly similar or perhaps slightly higher share of total world product. With plans to add more members, and with the use of the euro deepening, here is a trend that clearly knows of no September 11 watershed.”15 The successful conclusion of accession agreements with ten new member countries—not to mention the sustained appreciation of the euro against the dollar since Kennedy’s article appeared—has seemingly vindicated this analysis. So too, in the eyes of some commentators, has the vociferous and not wholly ineffectual opposition of at least some EU member states to American policy in Iraq. If the United States has an imperial rival today, then the European Union appears to be it.
PRO
In what ways does the European Union genuinely represent a counter-weight—let us avoid the overubrown word threat—to the United States?
DEMOGRAPHY
As Kennedy rightly says, the population of the European Union is already more than a quarter larger than that of the United States. One effect of the enlargement of the union in 2004 has been to widen the demographic gap still further, increasing the EU’s population to just under 450 million, more than one and a half times that of the United States.
OUTPUT
In terms of total economic output, the European Union is indeed not far behind the United States, depending on which measure is used. According to the World Bank, the combined gross domestic product of the fifteen preenlargement EU member states in 2002 was $8.6 trillion, compared with a figure of $10.4 trillion for the United States. In other words, the European economy was about 82 percent the size of the American. Adjusting on the basis of purchasing power parity reduces the gap somewhat—on that basis EU output is still nearly 6 percent less—but it does not eliminate it. Only when output is measured in constant prices (expressed in 1995 dollars) can European GDP be said to be higher.16 The ten countries who joined the EU in 2004 did not significantly add to its combined output.17 The GDP of the EU-25 is also bigger than that of the “U.S.-50” on the basis of purchasing power parity, though it is still around 15 percent smaller in current dollar terms.
PRODUCTIVITY
The West European economies have spent most of the past half century rapidly catching up with the United States when performance is measured in terms of productivity. In 1950 gross domestic product per hour worked in the United States was three times what it was in Germany; today German productivity is just 23 percent lower, while French productivity is a trifling 2 percent less than American. Between 1973 and 1998 U.S. pro- ductivity grew at an average annual rate of just 1.5 percent, compared with a French rate of growth of 2.4 percent.18
TRADE
The United States has large deficits on its external accounts, whether one considers just “visible” trade or the current account in its entirety. The same cannot be said of the European Union. Not only does the EU account for a slightly larger share of total world exports (20 percent compared with 18 percent), it also runs a small trade surplus.19 There is no question that in trade negotiations, the United States must treat the European Union as an equal. Nor is the EU as dependent on inflows of foreign capital as the United States (a point to be examined more closely in the next chapter). It is in fact a net exporter of capital.
THE SINGLE CURRENCY
To an extent that is not widely appreciated, the European Economic and Monetary Union has transformed the international capital market. The volume of government bonds denominated in European currencies was very large even before the single currency was introduced; in 1998 the outstanding volume of Eurozone government bonds was roughly half the outstanding volume of U.S. government bonds.20 However, as the rapid convergence of Eurozone bond yields shows, monetary union has greatly reduced what investors call country risk, so that all Eurozone members’ bonds are now regarded as being (almost) as good as the old German bunds. The EMU has significantly boosted the market for European securities. According to the Bank for International Settlements, around 47 percent of net international bond issuance has been denominated in euros since the first quarter of 1999, compared with 45 percent in dollars. For the equivalent period of time before the introduction of the euro the respective shares were just 29 percent for the currencies that merged to form the euro and 51 percent for the dollar.21 Moreover, for all its crudeness, the Stability and Growth Pact imposed tight constraints on the fiscal policies of the Eurozone countries, though whether or not the rule restricting deficits to 3 percent of GDP will be reimposed remains to be seen. In theory, at least, the pact has merely been “suspended” since November 2003.
The possibility that investors may come to regard the euro as being as good as the dollar when it comes to denominating low-risk securities cannot therefore be excluded. Indeed, they may already be doing so. In the year after February 2002 the dollar declined against the euro by 45 percent. U.S. long-term bond yields have been between ten and seventy basis points higher than Eurozone yields since 1997, having been lower for all but two of the previous twenty years.22 According to one projection, foreign direct investment over the next five years will be s
ubstantially higher in the EU than in the United States.23 When he urged his country’s state oil company to price its gas and oil in euros rather than dollars, the Malaysian prime minister, Datuk Seri Mahathir Mohamad, was doubtless aiming to score a political point at the expense of the United States. But his proposal (made in June 2003) was far from absurd. It is not without significance that Arab cartoonists have seized on the appreciation of the euro as evidence of American weakness. A cartoon published in 2003 by Al Jazeera depicted a euro note being run up a flagpole in place of a depreciated dollar, to the chagrin of a weeping Uncle Sam.24
A FEDERAL CONSTITUTION
Ostensibly, the European Convention’s treaty establishing an EU constitution does not create a European federation. We know this because the phrase United States of Europe barely made it off the drawing board and because the word federal was deleted from an early version of Article I-1, clause 1. The original version read as follows: “Reflecting the will of the peoples and States of Europe to build a common future, this Constitution establishes a Union… within which the policies of the Member States shall be coordinated, and which shall administer certain common competences on a federal basis.” The final version was rather different: “Reflecting the will of the citizens and States of Europe to build a common future, this Constitution establishes the European Union, on which the Member States confer competences to attain objectives they have in common. The Union shall coordinate the policies by which the Member States aim to achieve those objectives, and shall exercise in the Community way [sic] the competences they confer on it.”25 The question is of course how far the constitution nevertheless remains in practice a federalist document. Some people certainly intended it to be. When the 105-member convention was itself called into being at Laeken in December 2001, it was declared that its aim would be “the construction of a political union” to complement the Economic and Monetary Union created at Maastricht nine years before. In a joint statement before the Laeken meeting, the French president and the German chancellor expressed the wish that the convention should transform the EU into a “federation of nation-states.” The Greek premier went further, urging in January 2002 that “the enlarged European Union must evolve into a fully-fledged Political Union with strong governmental institutions and policies of a federal nature.”26
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