Collective Management of Music Copyright Directive

While the internet and digital culture has changed the way we consume media, the internal market hasn't quite kept up. The Commission's approach to extending the internal market online is based on the Digital Agenda for Europe (PDF) and the Single Market Act (PDF), which show a greater emphasis on EU legislation to extend the internal market online. When it comes to online music services and the transparency of collecting societies, so far there has only been a non-binding recommendation (PDF) inviting the Member States to promote these goals, but now the Commission has introduced a draft Directive to tackle these issues (PDF).

On the transparency and accountability of collecting societies (that collect royalties and then distribute them to the artists after taking a cut), the directive would codify minimum requirements governing the membership and powers of the members, along with the societies' duties when performing their financial and negotiation roles (such as distributing income due to the artists without undue delay and requiring negotiations to be conducted in good faith) (Title II). The Directive is intended to shift the power balance in favour of the members by setting out reporting duties for the collecting societies - the idea being that a better informed membership will be equipped to demand better services and so improve the position of music artists.

The second pillar of the Directive introduces multi-territorial licences to break down barriers within the internal market (Title III). Currently music rights are granted on a territory-by-territory basis, which naturally gives raise to barriers in the market. The multi-territorial licences (MTLs) won't replace the current system, but they will be an extra option for collecting societies. Interestingly, the Directive provides for artists being able to by-pass their collecting society under certain circumstances (Article 30) if the collecting society does not grant MTLs in music rights. The rightholder will be then be able to grant licences for their own online rights either directly or through another intermediary. Clearly this is meant to free artists to exploit their work across the EU and boost the use of MTLs by ensuring that rights will not be bound up nationally because of the policy and power of collecting societies (or by their inability to process them or otherwise fulfil the MTL requirements).

One of the major concerns for the music industry is that this would promote the homogenisation of music across Europe. While it may intensify homogenisation, there is already a degree of globalisation and Europeanisation of music that it unlikely to diminish by maintaining some market barriers. Having MTLs could also open up more audiences for niche artists as well by making a wider variety of music available to consumers - after all, the internet can prove useful as a tool for band promotion.

Legislatively, the directive is still at the first reading stage in the European Parliament, with Marielle Gallo (EPP) working on as the rapporteur for the Legal Affairs committee. The EESC has delivered its (non-binding) opinion on the draft, which largely welcomes the draft in its current form.

BBC Question Time and Europe

David Cameron's speech may have been put off (for understandable reasons), but Europe was the big topic on Question Time on the BBC last night. It's good to see the pro-European side developing some backbone, even if the arguments could have been put better (it's still strange to see that one of Labour's main issues with the EU is the lack of budget cuts, though).

Norway and Switzerland are set to be the most studied countries in Britain if the debate continues, with both sides raising it for their case - either as the proof of life outside of "Europe", or as evidence of the political enfeeblement of losing Union membership. Given that the in-or-out section of the debate started after a discussion on the free movement of Romanians and Bulgarians, it's strange that Farage was not taken up on the fact that they are more integrated in some respects than the UK (being part of the Schengen zone and also having to accept the free movement of people with Iceland and EU Member States), after he'd spent the last 10 minutes speaking against free movement. The Norwegian and Swiss models are more disputed now than they were before, however.

The biggest challenge for pro-Europeans is changing perceptions of the Single Market - that it's not simply trade, but the movement of people, goods and services, and it goes beyond just free trade. Progressives will have to argue why the internal market is political, and why we should value the political institutions - that do need reform - as a way to act on the environment, etc, in a way we wouldn't be able to otherwise. It will also explain why renegotiation is so difficult: because further British opt-outs would essentially be unravelling the core of the internal market and attacks common social protections.

If Farage - and Eurosceptics in general - are happy to hold up Norway and Switzerland as alternatives (that you can have all the benefits without the political institutions and symbols), then pro-Europeans will have to explain why that position is not just dishonest, but why more democratic EU institutions would be valuable and why they are necessary.

Cameron, Eurozone budgets and the Single Market

David Cameron signaled his support for the competence review to look at whether the free movement of people should be changed on The Andrew Marr Show on Sunday. You can watch the interview on BBC iPlayer if you're in the UK (the interview starts at 28.45, the European section starts at around 43.30).

The Home Secretary, Theresa May, first issued a call for the free movement of people to be looked at in order to control migration within the EU more. At the last election, the Conservatives promised to cap immigration and they've been criticised for ignoring the free movement of workers within the EU as the major source of immigration. Given the difficulties of the Tories in government, perhaps Cameron wants to repatriate Conservative voters from southern France and Spain!

Changing the free movement of people is a big ask. It's one of the fundamental freedoms of the single market (remember, the single market the Conservatives are supposed to be in favour of?), and the rights of free movement of EU citizens are already pretty much subject to a worker test (i.e. you have to be working or have worked in a Member State before you can claim benefits there). So it's not really a question of EU nationals "pulling their weight", but whether they should be allowed on the job market at all.

This really points to a shallowness in political thinking. The only form of regulation the Conservatives seem to believe in is regulating the movement of people! But the point of the single market is to have a more open and dynamic market where people can enjoy more goods, services, business and working opportunities. Tightening the screws on the movement of people within the EU is of little use if the aim is to protect British workers, because they will still be in a competitive European market, and businesses and capital can still move within the EU. It would be much better to improve the social side of the European Union to help drive social and economic standards up across the Member States to prevent a race to the bottom while allowing us to enjoy the benefits of the single market, including the free movement of people.

This just highlights the fact that the single market is a political project.

On the EU budget, Cameron said that the UK would veto any big increase. But he also indicated that a separate Eurozone budget may be required for fiscal transfers within the Eurozone, and that such a development would be welcome. It's a very interesting point, because a separate budget would mean that there would need to be a division in the European Parliament for it, and divisions within the EU institutions would raise further questions of diluting the UK's influence in the EU generally. And the official reason for the veto last year was that there weren't enough safeguards in the (not yet negotiated) Fiscal Compact to protect the UK's political influence in the single market! Cameron seems to be aiming for a kind of EEA membership within the EU: the perks of the single market plus the political influence without the obligations and financial responsibilities. He'll have a hard time walking that line.

The EU Debate on the BBC

Another recommendation today, with a debate on BBC Radio Four called The EU Debate.

The debate covers the in/out debate for the UK in the EU from the politics and economic perspective. It would have been nice to have a programme/debate on each aspect of the relationship (politcs, ecomoics, justice and security, and foreign affairs) to get a bit more into the subject, but it's a good programme.

Since it's BBC Radio, it can be listened to outside of the UK, unlike TV programmes on BBC iPlayer.

Some notes on the UK's EU debate

After yesterday's post on the UK and the European Social Contract, which was written from the general point of view of the Member States and the compromises between their national social contracts, I thought I'd just note a few aspects of the current public debate in the UK on the EU. I'll not cover any specific groups, but just the general state of the public discussion.

1. Renegotiation for...? Despite all the talk of bringing back powers from Brussels, there isn't exactly a clear idea of what powers should be brought back. Social policy seems to be the only area that's highlighted, but the tone of the debate suggests that it matters more that a big victory is achieved by the UK for bringing a policy area home (and that the papers can run with this), rather than there being a specific goal. While it's understandable that the government wants to keep its cards close to its chest so it's easier to claim a victory, if there's such a public groundswell against the EU relationship, it's remarkable that it hasn't crystallised into a key demand yet.

2. The Internal Market as an Ideal. The internal market is viewed as an ideal in isolation to the rest of the EU and simply as a free trade zone, whereas it's deeper than that and requires an extension of the national social contracts (into a form of European Social Contract like I argued yesterday) to maintain its legitimacy.

3. There is no set of plans or reforms that have been demanded for which repatriation of powers is necessary. This links into the previous points, since it's very vague what areas the government will seek to bring home, and the social contract aspect of the EU isn't fully understood (not that it is elsewhere, but there does tend to be a greater understanding of the connection between economy and society in these terms). How does the UK want to change its own social contract? There have been arguments in the UK over financial regulation and whether it should be made easier for businesses to fire people. The lack of ideas and debate about what the UK will be following this repatriation of powers is amazing. What is the UK prevented from doing - or what kind of country is it prevented from being?


4. A referendum on a negotiated settlement could easily fall prey to a Eurosceptic (right) - (ambivalent/more pro-EU) left-wing alliance too. Without a clear sense of direction or purpose over what the UK will do or become with repatriated powers, there is a danger that a referendum would fail due to an alliance between Eurosceptics who reject it as too weak, and those who fear that the national social contract will be redrawn in a way they don't want. I would guess that as the debate becomes more specific over policy areas (e.g. social policy), there will be more questions raised over what will be done with these powers (e.g. maternity leave). It will become easier to paint the renegotiation as an attempt to achieve deregulation and a shrinking of the state, and this may feed in to the referendum campaign.

5. Assumption of alliances. I mentioned this yesterday that for renegotiation there is an assumption that the Northern Europeans want the UK in the club to balance out the others and will help the UK with its deal. However, if the UK withdraws from more legislative areas or sets that as its goal, then it signals that it will be a less useful and influential ally in the future for these countries, making it less attractive for these Member States to spend their political capital in Britain's favour.

It seems to me that there needs to be a debate on how the UK wants to change itself and how it sees itself as a country before it decides how it wants to change its relationship with the EU.

UK renegotiation and the European Social Contract: Free-rider Status?

Today Open Europe argues, on their blog and in The Telegraph, that the Norwegian model is a bad model for the UK to pursue, and that the British government should try to negotiate better terms within the EU rather than leaving to join the looser EEA. In arguing this, Open Europe take the argument of those who support either the status quo or further integration - that EEA membership or a Swiss model relationship with the EU would lead to a loss of political influence but require high levels of acceptance of rules decided in Brussels - and uses it to support the argument that the UK can get a special relationship within the EU. The UK, the argument goes, is such an important market, and Germany and other northern countries want the UK to remain inside the EU as part of a market-liberal alliance, that the UK can win a place as a member of the internal market, but opt-out of pretty much everything else.

This misses the point of what the internal market - and the EU - actually means to the rest of the Member States.

Back in the winter, when David Cameron wielded the British veto on treaty change, there was a political storm over whether Cameron negotiated well or not, but also a wide acceptance that what the UK asked for was reasonable. I argued that it wasn't, given that it was reversing integration in the internal market and that it would run counter to even the interests of the more traditionally UK-aligned Member States. In the UK the EU is portrayed as a free trading agreement that has run out of control, but the internal market itself is more than that, and the fact is that the rest of the EU needs to exist to politically support the internal market.

The internal market goes beyond a free trade agreement and a customs union because it's not just about getting rid of tariffs at the borders, but about creating an economic and legal space where businesses and people can move and work and provide goods and services without obstacles being thrown up by different regulatory systems. This means that there needs to be some harmonisation and some mutual recognition of rules and standards.

Which brings us to the "European Social Contract". Yes, despite all the fallout and arguments of the Eurozone crisis, I would argue that there is a basic social contract at the heart of the EU, which is also important to ensuring that the internal market has the political legitimacy to exist. The internal market covers a massive economic space and its regulation has social, economic and environmental consequences. Given the post-war social contract in Europe - essentially that the state has a place in ensuring the social welfare of the people both as a moral duty (it's seen as part of "what the government does", and in order to provide a bulwark against extremism and social instability - and a crude deregulation of markets within a European space would threaten national societies and their identities. The social and environmental legislation and the elements of redistribution that exist in the EU are an attempt to preserve this social settlement while unlocking the economic potential of such a large continental market (we'll ignore the history of integration being seen as a way of ensuring peace).

While the internal/single/common market has been elevated to an article of faith in the UK, really it relies on the social, regional developmental, redistribution-orientated and environmental faces for its political legitimacy. Would the other Member States not only be willing to give the UK full access to the internal market and let it leave the areas that sustain its political legitimacy, but also let it retain its political influence in votes in Brussels? It's a hard bargain to drive to say that you will have full benefits in the areas you like, but opt out of all other obligations. I don't think other Member States would be willing to open up their markets fully to a country that will not accept its part of the European Social Contract. It's up to Britain if it wants to reduce workers rights and social and environmental protection, but why should the other Member States provide the UK with unfettered access to the internal market if it does?

This is not asking for second or third tier membership, this is asking for Free-Rider Status.

The argument that the UK is too important to the more market liberal Member States to let Britain leave - as has been argued elsewhere too - also forgets to touch on the UK's political weight and influence as a Free-Rider Nation. The UK - and probably its MEPs - would not have a say in the areas that the UK opts out of. What use is the UK as an ally here if it doesn't have a vote? This is another aspect of the UK's negotiating position that is just not recognised in the British debate: the more the UK opts out or talks about opting out, the less valuable and reliable it is as an ally for the other Member States. After all, why should you put your political capital on the line for a country that's half out the door and in little position to help you in return?

There's no such thing as a free lunch, and in the EU there can be no such thing as a Free-Rider Nation.


UPDATE: The Centre for European Reform explores the Norwegian and Swiss options in more detail.

Unreasonableness and the Rebate

While political battles are being waged over Cameron's veto, there seems to be at least one point of consensus within Britain: that the demands on the protection for financial services were reasonable. The Labour party hasn't set out exactly what it would have done (it says it would have stayed at the table and achieved a better deal, though it's hard to run a "what-if" scenario since the Cameron government's relations and those of a Labour government with the other 26 Member States over the last few months would need to be taken into account), but it seems that Labour basically supports the government's position on the treaty changes it was seeking, and that such changes were reasonable.

But today the Commission President Barroso told the European Parliament that Britain's demands were unreasonable and would have threatened the internal market.


Unreasonable Demands?

Financial services are part of the internal market, and are covered by Article 114 TFEU. This article provides for the regulation of the internal market, and the legislative procedure is the ordinary legislative procedure (i.e. the Commission proposes, and the Council and Parliament have an equal say in amending and passing the legislation). Britain wanted to insert a protocol which would grant every Member State a veto if the regulation was concerned with the financial services sector. Because every Member State would have a veto, the British government argues that it wasn't merely seeking to protect the City or asking for special treatment for itself.

However, this does threaten the legal and political basis of the internal market. To make it harder to regulate one sector of the internal market is to privilege one sector of the internal market over all other sectors. While it may be technically correct that Britain wouldn't be legally privileged over the other Member States, this would have created a separate legal procedure for introducing regulations for a separate sector of the market, so it would have introduced a legal division in the treaties between financial services and the rest of the internal market.

Then there's the political concept of the internal market. That internal market legislation is passed by majority voting is not only necessary to ensure that legislation can be passed at a pace that more closely reflects the pace of innovation in the market (compared with unanimity - we don't want to return to the days of waiting years for a single regulation to be passed), but also this politically underlines the mutual trust between the Member States in each other as they work on the internal market. If legislation is passed by qualified majority vote, then everyone has to work together to get legislation passed (and can't simply oppose all legislation outright to get its way) and Member States also have to be sensitive to the needs of the others (in other words: if you outvote me here, I'll outvote you there, so let's not play the zero-sum game). By introducing special protections for parts of the market that have been identified as a key interest by one Member State, in political terms you are privileging that Member State over the others in the overall internal market negotiations, and weakening the trust that is supposed to underwrite the market.

So Barroso was right to say that what Britain was asking for was unacceptable (or at least that it would be unacceptable for other Member States). Why should the financial sector be treated differently to other parts of the internal market? Should Germany have a protocol so there's a veto in the area of environmental policy when it comes to the car industry? Why shouldn't economic sectors of interest to other Member States be more protected? Because the more you reverse the integration in the internal market, the more you break up that market. Similarly, most other Member States see the social chapter as protecting their welfare states from a race to the bottom while entrusting their economies to the competition of the internal market. Yes the UK is one of the most committed Member States to free markets and a liberal internal market. But it fails to see how these trade-offs are part of the "Single Market Pact" sometimes, and how unacceptable its position can appear to others. If you can't understand the position of those you negotiate with, then you don't stand a good chance in negotiations.

It should also be noted that there are plenty of EU regulations that only set minimum standards, above which Member States may regulate more heavily. It should be easy to negotiate this minimum standard approach, rather than pitch for a full legal division of the internal market.

Finally, Barroso claims that he tabled a motion that should have met key British demands on protecting the internal market from a Eurozone caucus:

"In search of compromise, I tabled a clause providing, in the EU treaties, that any measures adopted by the Council and applying to the euro area only, must not undermine the internal market including in financial services. Unfortunately this compromise proved impossible."

The Rebate

Joseph Daul, the leader of the European People's Party group in the European Parliament, said:

"I believe that the British rebate should be put into question. Our taxpayers' money should be used for things other than rewarding selfish and nationalistic attitudes."

For the UK, the rebate is like the EP's Strasbourg seat for France or the protection of the low corporation tax for Ireland. For Britain the rebate is a question of fairness: otherwise it would contribute more to the EU, which isn't fair as others get back more in the Common Agricultural Policy.

But times have changed since Thatcher demanded Britain's money back. Back then the EU was a club of fairly wealthy countries, but now it has expanded to include the former post-communist, Warsaw Pact countries. During the negotiations for the "Big Bang" enlargement - which the UK was a huge supporter of - the question of the British rebate was raised. With 10 new Member States joining, which would all be poorer than the then-current members, there would be greater pressure on the EU budget to cover the structural funds and CAP costs. Would Britain, who supported this enlargement so much, not either give up or reduce its rebate to help cover the costs of greater solidarity with the new members? No. In fact there was the sad situation where Poland had to ask how much more the new members would have to pay to make membership a reality. Because the EU budget cannot be based on debt, so other countries have to fund Britain's rebate.

Of course it's not as simple as saying that Britain should have surrendered its rebate at that point. It's not to say that there are not other interests that are protected in the EU budget and that these shouldn't be seriously negotiated over. But it is an odd policy to drive forward enlargement, while demanding the EU budget to remain static on the one hand, and defending the British rebate on the other. If Britain is to make the case for the fairness of the rebate, it will have to move on from the arguments of Thatcher.

The key point is that the EU is a compromise. The internal market isn't something that can be viewed in isolation, and it is a mistake of British politics that the EU is often only presented in that way. Without the solidarity with poorer regions, opening them up to the competition from the more advanced economies is a hard sell. A minimum level of solidarity is required to ensure that the welfare states and the communities in Member States won't be too negatively affected by the downsides of the internal market - and in some countries where euroscepticism is mainly on the left it is argued that the EU is neo-liberal and there isn't enough solidarity. So when discussing the internal market, social policy and the budget, we need to have a more nuanced and fuller idea of the fairness that's required in the EU for even a minimalist internal market to work.

What kind of Free Trade do the Tories believe in?

The news that a government contract for the Thameslink project worth £1.4 billion has been awarded to Siemens rather than Bombardier. It's become a big news story because Bombardier has announced plans to cut over 1,400 of its UK-based jobs. The EU has been singled out for some of the blame:

"The government has said that the Siemens bid represents the best value for money, and that it was following EU procurement rules, which do not allow where companies are based to be taken into account."

The deal with Siemens will reportedly create 2,000 jobs, though:

"...Siemens will build the trains in Germany and only 300 of the UK jobs it creates will be directly employed manufacturing posts, at a factory in Hebburn, South Tyneside."

The article shows that manufacturing jobs are seen as the goal for the UK economy. With services far outpacing manufacturing in the UK economy, job cuts in this area are seen as a further sign of failure. Interestingly, the BBC just produced a good 3-part documentary called "Made in Britain", the premise of which was that manufacturing jobs will leave the UK anyway and that the UK should (and is) moving into higher value economic activities. It's very strange that there is little debate on how Germany actually retains its manufacturing sector and whether the social and economic policies they use would work in the UK or if they are desirable.

[It seems that the loss due to the failure to win the contract is 200 jobs (as Bombardier wrote to the government stating that it would lay off 1,200 workers anyway). Talking about jobs in terms of "net gains" is not to dismiss the tough time these 1,400 workers are facing at the moment, but it does seem that making the deal with Siemens has the effect of creating more jobs than would have been saved had Bombardier won the contract (2,000 versus 200).]

Anyway, the fact that EU law on procurement (you can read the PDF of the legislation here if you have a spare week) prevented the government for picking Bombardier has been flagged as one of the (if not the) main reason for the loss. Under these rules, Siemens won the contract because they represented the best value for money under the criteria set out for procurement. Where the company was based was not allowed to be a factor in determining which company got the contract.

This raises some questions about how the internal market is really viewed, because the anger seems to be directed at the rules in different ways. The impression from the news is that either (a) it's Labour's fault for drawing up the contract criteria; (b) the rules are good in principle but other Member States don't apply them as well as Britain does; or (c) it's the evil EU, goddamnit!

(a) & (b) are linked - how contract competitions are run (what the criteria are) would depend on the sector/work. There have been suggestion from within the government that the rules should be changed. Via Conservative Home:

"[Transport Secretary Philip Hammond] did tell the BBC's Evan Davis that he wanted to look at whether similar contract processes could be rewritten in future so that successful bidders were, in some way, committed to the "domestic supply chain". Noting that French building contracts tend to be awarded to French manufacturers and German contracts to German manufacturers he promised to explore how British industry could be supported in future tender processes without compromising EU procurement laws."

So some Tories would like commitment to the "domestic supply chain" to be a factor. It's hard to see how this can be interpretated in any other way than that government should be able to value national over European companies purely on the basis of nationality or the level of establishment within the Member State. After all, the contract is awarded to those who can provide goods or services to the government's criteria and requirements. It's not like the companies create their own system and then, if they aren't rehired in a new contract, the system breaks down and needs to be rebuilt by another company to its different standards.

There are 2 options:

1. Weaker rules that permit more protectionism.
2. Keeping the rules and ensuring better implementation in other Member States IF that is a problem.

So what kind of internal market do some of these Tories want? What is their vision of free trade? Are they really going to pick a political fight over this?

Am I the only one bemused that Tories are complaining that the "socialist and bureaucratic EU" has prevented government from watering down market competition to engage in soft protectionism?

"But we signed up to a free trade area!"

More and more I see the argument that the EU should be turned into a free trade area, and I thought I should try to create a short reply.


"But we signed up to a free trade area!"

This is also argued with "common market", with it clear that a free trade area (like NAFTA, for example) is meant. But there's a big difference between a free trade area and a common market (a.k.a "single/internal market").

A free trade area simply reduces tariffs and import quotas between countries - this was the aim of the European Free Trade Area,* which the UK helped found in opposition to the EEC, and then left to join the EEC. FTAs don't cover the free movement of goods, people and services that a common market consists of.

The issue with free trade areas that they only reduce tariffs between members, so members can have different tariffs with third countries. This means that some goods might try to get into the free trade area via FTA country A (which has lower external tariffs) before moving on to country B (which has high external tariffs). This lack of control means that some countries prefer a customs union, which is like a FTA but with common external tariffs.

A common market is much more than a FTA because it not only deals with tariffs and import quotas, but also deals with the free movement of goods, services, establishment (freedom to set up businesses throughout the common market), capital and people. This requires some restrictions on the law-making of member states (they can't legislate for import quotas, discriminate against goods from outside the country with different tax rates, etc.), and requires common law making so goods, etc., can move freely without being blocked by different technical standards. This common law making and standards means that there would need to be a common court and law-making institutions in any case. That's why the EU needs to have institutions, but NAFTA doesn't.

Leaving a common market means that a country and its citizens would loose free movement rights. While it's true that there will still be trade between the EU and ex-members (the EU has FTA agreements with Chile, Mexico, South Africa, etc., so I don't see why an ex-member wouldn't get one as well), without common laws, the ex-member would move away from the common standards of the common market, and more and more non-tariff barriers would block trade. Citizens of the ex-member country would also loose their free movement rights.

Having a common market also means that there needs to be a common trade policy with third countries, and the free movement of persons creates pressure for there to beco-operation and common rules on cross-border crime, but foreign affairs and justice and home affairs are other debates.

Since the EEC was aimed at creating an common market, joining countries never signed up for a free trade area.



*Confusingly, the EFTA is now a single market because its member countries are linked up to the EU's single market via the European Economic Area (or via 120 bilateral agreements in the case of Switzerland).

Does Europe have any Common Foreign Policy interests?

In my post on Neutrality and Europe, which was focused mainly on Ireland's policy of neutrality and its compatibility with EU membership, I hinted at what I thought was a basis of a possible section of common European foreign policy interests: the single market. On Grahnlaw's Blog (the post on Sweden's neutrality/non-alignment), in the discussion, Grahnlaw remarked on the tendency of European foreign policies to speak in more pacifist terms when discussing foreign policy, perhaps just to placate a more pacifist public. I think that Europe is probably home to some of the most pacifist populations and perhaps that translates into (truly) more cautious governments (I suppose that depends on both the country you're talking about, and who you're talking too), i.e. governments are actually affected deeply by the public consensus because they are part of that society, though the calculations would end up playing out a bit more differently when cold policy choices need to be made (and these can be between 2 evils).

These attitudes have both historical and contemporary reasons - and these are well known: WWII/history of destructive war, and the contemporary experience of successful multilateralism. However, I think that these attitudes and the policies that come with them are suited to the problems we face in our region (and perhaps even a mature reaction to these problems, though that would be very contentious to argue). While I've said that Europe has probably the most pacifist populations of any region of the world, I think that most people here fall into the multilateralist band - in other words strong diplomacy, and any use of force to be based on some form of the "just war" doctrine.

So what could be the common foreign policy problems that Europe faces? Sadly, this part isn't too radical, as much as I'd like to say something completely original here. It's mostly stability - stability of:

- Eastern Europe (defined here as countries east of the current member states)
- the non-EU former Yugoslav states
- North Africa
- the Middle East, especially Israel, Palestine and Iran
- energy security
- trade security (e.g. security of trade routes such as those passing by the Horn of Africa)

These would be issues for the member states with or without the EU, in a sense, because of geography. But the internal market means that we are a lot closer and our interests are less bound by coincidence: the free movements mean that we've a highly integrated economy which is adversely affected by stability on our frontiers. All member states are more equally exposed and exposed in more similar ways; northwestern member states are no longer quite so insulated. Failed states also mean more and less controlled immigration, more criminality, increased drug trade, etc. The impact of this on a free single market and our societies can be very damaging. The problemd with a lack of energy security can be seen by events over the last few winters in Ukraine and Russia. The Middle East Peace process is an issue for both these reasons and for moral reasons.

The solutions to these problems are mostly the ones which the European publics and the European states have been talking about for so long, albeit backed up with a more robust diplomacy and more willingness to take the initiative. A prime example is the Middle East Process, and indeed the Middle East in general. Due to our close proximity to the region, we suffer more than the US when things go wrong (though obviously we're not the ones that suffer the most) - it's hard to see why Europe isn't more assertive here; sure we have our differences, but we're all agreed on the goal. Even the US agrees with the European position. So why can't we be more robust in promoting the peace process? There needs to be tough love with both sides (a basic outline of some of my thoughts on what could be done here), and Europe has the resources to act effectively here. The US may handle Israel with kid gloves, but we don't have to, and we don't have to wait until the US catches up in foreign policy again.

The basic formulation of multilateralism, robust diplomacy and engagement tailored to each area is a winning formula, if done properly. Inherent in this is the recognition that foreign policy is, in a way, just like domestic policy: force of arms generally is a bad idea, and should only be used in extreme cases - and even in extreme cases, they only provide the breathing space needed for a proper political settlement. A good foreign policy is based on a drive for a legitimate international structure, based on balancing needs and interests encompassing economics, stability, participation and political recognition. In many ways a good foreign policy shapes and sustains a successful region in a way that mirrors that of domestic policy. Obviously there are some extreme cases which don't fall into this theoretical musing of mine: not all interests can be balanced or satisfied. However, I believe that such an approach is the best approach for the problems we currently commonly face.

While the US has been portrayed as a global policeman, I think that Europe is the one with the more policeman-like tendencies. The US is more like a superman, racing off to fix certain problems in special circumstances, while Europe works away in the manner of a policeman (though, still in a limited way and in a limit sphere): policing communities, building nations, acting as an administrator, a trader, etc, etc. The US has elements of this too in its policy, but these aspects are the core of how foreign policy is perceived here, if not consciously (or so it seems to me).

An official British perspective on Europe?

David Miliband, British Foreign Secretary, has given a speech on European Reform at the LSE. (Click here). There seems to be a few ideas there, along with a desire for reform (and note the use of climate and energy security policy to slip in an attack on the CAP), but is Britain actively promoting these policies or engaging with the other member states to forge a way forward? It doesn't seem as if any country is really pushing imaginative schemes, to judge from the bland outcome of the recent summits.

And the Commission is hardly taking a lead either.

I like the defence of the single market and the Community institutions/legal system:

"...the best defence from encroaching protectionism is an effective European Commission. You cannot be in favour of the single market, but against the very institutions that preserve the rules of the game. This is the fundamental contradiction at the heart of the eurosceptic position."

I've ranted on about it myself. Why can't there be a spirited defence of Community values for a wider audience? Reform isn't enough - the public should be told why the system must be defended and reformed.

Red Tape Holds Europe Together

It's not meant as an insult, and it seems obvious, but it's true. And it's amazing to think that after all this time, the nature and need for European bureaucracy is so misunderstood. The standard calls by Eurosceptics for the end to the Brussels bureaucracy and for the EU to be turned into a free trade area, either don't understand the nature of the single market, or want less free trade. But some are waking up to the necessity for the EU, and the bureaucracy that it entails. That's not to say that I back all of the rules and regulations that come out of "Brussels", and I'm not supporting the equation of: bureaucracy is necessary, and therefore good, and therefore we need more.

Yet it's becoming clear that the EU is not equipped to deal with the crisis. The Commission's vague hints at a plan to help Europe, weak and ineffectual sounding even at the time, highlights the powerlessness of the EU to hold together and support its single market, which is the heart of the EU.

We need to dismiss this view that the single market is somehow equivalent to free trade areas in some way. It is so much more, and if we loose it now, we will all suffer. The single market is based on countries coming together to build a market between them which will be as integrated and free as domestic markets. This is clearly more than a free trade agreement, which merely deals with tariffs, but leaves other financial controls and non-tariff barriers in place. These restrict trade, and so for an effective single market there is a need for common rules to prevent national ones from distorting trade. Which requires common institutions and a common bureaucracy. The European bureaucracy is the life-support machine for the single market, and for the most free international trading system in the world.

The argument that the EFTA would be a good replacement is highly debatable. The success of the EFTA to date probably rests to a large extent with the success of the single market - EFTA members are buying into a more liberalised trading system without joining it: if the single market falls, then barriers to trade will rise up again, and an EFTA can't deal with this nor compensate for this. To tear the EU bureaucracy down, or diminish it now would be a grave mistake.

On the contrary, it needs to be strengthened, both in terms of power to deal with the crisis, and in democratic legitimacy. The current Commission is ineffective and without any power or imagination to lead in the crisis, rejecting proposals out of hand for fear of the member states' reaction, while the member states become more and more of a threat to the single market as they retreat into veiled protectionism and incoherence. Max Bergmann seems to hint that more political aspects are needed in the EU. I would agree with this, as far as democratic accountability is needed, both for its own sake (the single market economy affects us all, and should be more accountable) and to bring back confidence in the system. It will also give the EU the legitimacy to be pro-active in crisises.

This isn't political union, but the macro-economy needs to be dealt with at the macroeconomic level, and it should be accountable and effective. Europe needs good economic governance, and it needs it now. If we can't protect and support our single market, it will fall - and take us with it.

Klaus, and levels of decision making

Czech President Klaus addressed the European Parliament yesterday, to tell them that the directly elected body is essentially anti-democratic.

"Are you really convinced that every time you take a vote, you are deciding something that must be decided here in this hall and not closer to the citizens, that are inside the individual European states?" Mr Klaus asked.

Subsidiarity is a very important concept for the EU, and it probably needs to be considered more, though of course it would be a political minefield, since "subsidiarity" is the EU's term for the distribution of power to where it is as effective and as close to the people as possible.

So subsidiarity poses 2 questions: is the European or national level best for [a certain power], and is the national or the local level best for [a certain power]?

This includes taking power from the national level and devolving it down too:

"[EP President Poettering] did concede one point to the Czech president, saying that decisions should be indeed taken closer to the citizen, but that it was also the responsibility of national government to devolve powers to regional and local authorities."

The EU institutions work mainly with the Internal Market; for the EP this is especially true as it has little to no input in the more sensitive areas of Justice and Home Affairs and the CFSP (Pillars 2 and 3). Now I would say that the best level for legislating for a transnational market is, well, the transnational level, so I would say yes, the decisions the EP take are generally best decided at EU level.

The implication of Klaus' speech is that he would prefer decisions to be taken at a national level. With regard to the internal market this is done to some extent through the ECJ's doctrine of Mutual Recognition (if it's legal to be sold in one member state, then ditto for the other member states, unless there's good reason for this not to be the case). But then Klaus has been positioning himself to avoid signing the Lisbon Treaty into law in the Czech Republic if the Czech Parliament ratifies it by saying that he won't sign it unless the Irish vote Yes.

On the basis that the closest level of decision making for the Czech Republic, is, in fact, Ireland? (....If only more countries would give us a veto on their parliamentary decisions.... In their own interests, of course. In fact, we should elect the Czech President to make sure s/he doesn't get any strange ideas about bowing to the will of the Czech Parliament).

So is the Czech Parliament an illegitimate vehicle for governing the Czech Republic? (Surely the President is even more removed than the parliament from the people, and, since the post can only be filled by one person, even less representative).

Klaus also makes the "EU is not just undemocratic, it's anti-democratic" argument. The composition of the EP cannot make a difference because it cannot form a government and an opposition, he explains.

Then, realising that this is just an argument for giving the EP more power to ensure the accountability of the Commission and (even more shockingly) the member states in the Council, he quickly moves on to the "polity" argument - that giving directly elected politicians more power won't be very democratic either, since people won't identify with them.

Personally, I've never heard of people identifying with national politicians, never mind European ones, but I think that the polity argument takes a very narrow-minded view of human identity: that we can only identify with one thing at a time. (Interestingly as media and economies have grown in reach, so human identity has been pushed up to higher levels while remaining to some extent at each level: family - tribe - city-state - nation state - ?) It also assumes that identity is essential to legitimate decision making, whereas I would argue that having a fair and open arena where ideas are discussed and voted on lends its own legitimacy. The EP needs to engage the people more, no doubt, and the media needs to do its duty in informing the public and holding the EP up to close scrutiny, but these are practical problems that can be addressed - we don't need to give up democracy here as a lost cause. (Jon Worth has a good article on this).

The conclusion would logically seem to be, for Klaus, to pull out of the EU, yet he rules this out as a viable alternative. He says there is no alternative to EU membership. (Grahnlaw disagrees). So does Klaus have a solution? Not really.

The thinking seems to be that powers should be taken back from the EU to national level, but the internal market remain in place. Some powers of the EU aren't essential to the workings of the internal market, but the vast majority are. So how should they be set? They can't be done nationally, and just agreeing to them in an intergovernmental fashion (i.e. just have the Council) is even less democratic than the EU we have now. Surely people should be involved in deciding how we run our common market? But apparently this wouldn't really be democratic?

Unless he doesn't want the internal market, but merely free trade (which is the term he uses), which is much, much less than an internal market - just the end to tariff barriers, with all the non-tariff barriers to trade still in place (no true free movement of goods, people, and services). If so, does that mean that Klaus is actually quite protectionist? I doubt he wants an end to the internal market, which is why he has recognised that there is no alternative to the EU when it comes to the internal market.

So why not come up with some solutions to what he perceived are the EU's problems? Far from providing the debate he claims to want, he merely perpetuates the same old tired arguments.