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Independence in Europe?

Jun 29

Posted by Malc in Constitution, Europe | 50 Comments

At the risk of putting my own head above the parapet and being whacked the same way Stuart Winton has been, I’ve a few comments about the idea of independence in Europe that I thought I might air.  But please be nice.

One of the bedrocks of the SNP’s independence message is that Scotland would have a stronger voice within Europe – and indeed, the wider world.  You only have to read some of the comments on Stuart’s post to see those arguments voiced.  As it stands, if Scotland wants a policy pursued at EU level, it must agree it with the UK government at Westminster, and that particular policy will only be pursued if the UK government itself sees it as consistent with the wider UK interest.  Certainly a system whereby Scotland would have its own voice at this level – and the opportunity to use it – would appear to be a more attractive notion.  However, is it as simple as declaring independence (making the assumption that there is a yes vote in a referendum) one day and speaking up in Europe the next?

It seems, the answer to this question very much depends upon who you ask.

The SNP’s team of constitutional lawyers indicate that there would be no difficulty with the above situation.  In their view, it is perfectly legitimate to consider that, while Scotland will be seceding from one Union (the UK) it has given no indication that it wishes to leave another (the EU) and thus would continue its membership as previously, with various amendments since it would now sit as an independent nation-state.  This would presumably entail increased membership of the European Parliament, voting and veto rights and various other aspects of membership.

Others indicate differently.  They consider that the UK is the member state of the EU (which no one would dispute) and as such, any component part of that union which separates itself would also avail itself of the various treaty obligations which the UK holds – including membership of the EU.  Thus, Scotland would have to re-apply for membership of all the international bodies to which it would like to align.  Needless to say, independence which brings no commercial ties to Europe would be a less attractive option than independence with full EU membership as a guarantee.  Indeed, many of the European Parliament staff members – of several nations – indicated that this was what they thought the case would be, especially since the Spanish (who face a similar situation with Basques and Catalans) would likely block the first option.

Then there is a third camp, which argues that, while Scotland would have to re-negotiate membership of the EU, so too would the rest of the UK.  The point in this case is that the member state which negotiated membership of the EU originally no longer exists in the same form as it did when it negotiated membership, thus all memberships become null and void.  While this third scenario would confirm Scotland on a similar legal standing to the rest of the UK, this would come as little economic consolation if both had to re-negotiate membership – with the added problem that this time it is likely that no opt-outs would be granted (meaning adopting both Schengen and the Euro as mandatory conditions of membership).

So – several opinions but no hard facts.  Part of the reason for this is that there is no legal precedent for what might occur should part of a member state decide to secede.  Of course there are cases of secession we can look to (Czech Republic and Slovakia, Kosovo, Montenegro – even Greenland) but none where membership of the EU has been at stake.  There is a flip side – East Germany was incorporated in Germany’s membership – but that was a distinct situation (which could perhaps be repeated should Northern Ireland ever merge with the Republic of Ireland, but that’s a different issue entirely).

From discussion with MEPs of all Scottish parties and others, as well as non-partisan voices in the European Parliament in Strasbourg, it is clear that nothing is clear in this areas.  Labour’s Catherine Stihler has asked the question of the European Commission on several occasions, with the only response being that they do not comment on hypothetical situations.

Well, this is no longer a hypothetical situation – we will have a vote on independence and a very real chance that Scotland will vote for it.  There are perfectly legitimate and rational arguments on either side of this debate, and it is one which does need much further exploration – and a clear answer will surely be required before we move to the referendum.  Indeed, the answer in the latter may well depend on the answer to the former.

The so-called Eurocrisis: separating myth from reality

Jun 15

Posted by Guest Blog in Economy, Europe | 17 Comments

On our travels in Strasbourg we invited Scottish MEPs to guest post for Better Nation on the topic of their choice. First to take up our offer is Labour’s David Martin MEP, former Vice President of the European Parliament itself.  David can be found elsewhere on Twitter, Facebook and his own blog.

To read the British media or to listen to many British politicians, you would think that the euro as such was in crisis and about to fall apart. This is sometimes accompanied by a smug smile about how wise we supposedly were not to have implemented Labour’s policy to join the euro. A little more factual analysis would be welcome.

For a start, the euro as a whole is not in deep crisis. It has strengthened in value on international monetary markets (while the pound has plummeted); it has throughout its existence maintained a low and stable inflation rate; the balance of payments of the Eurozone is in broad equilibrium; and the euro is beginning to gain the advantage of being held across the world as an alternative reserve currency to the dollar. Economic growth has returned to the Eurozone as a whole (and especially in countries like Germany and France of comparable economic magnitudes to Britain, where growth is still stagnating).

Yes, some Eurozone countries have hit problems of excessive debt – just as have a number of countries outside of the Eurozone (such as Iceland, Hungary, Romania, Japan and potentially the USA). Various countries have received loans and this includes three Eurozone countries (do the press ever mention any others?). These three countries amount to a total of 6% of the Eurozone economy.

The loans are not actually “bailouts”. They are not grants or gifts. Nor has there been any assumption of liability for their debts. So it is wrong to say that taxpayers from other countries are having to fork out: the loans even attract interest so, unless there is a default, the lending countries will gain financially.

In fact, we would do well to stand back and look at the wider picture.  After all, Europe was hit three years ago by the biggest economic tsunami since the Great Depression. Yet we avoided most of the mistakes that we made in the 1930s:

  • We avoided protectionism — in no small part thanks to the single European market.
  • We largely avoided competitive currency devaluations — in no small part thanks to the euro (just imagine for one moment what would have happened if we had still had the French franc, the Spanish peseta, the Italian lira, the German mark, the Belgian franc and so on: there would have been in turmoil on the international currency markets in addition to the turmoil we already had).
  • We agreed on a fiscal stimulus at the depth of the recession (with an exit strategy) which helped turn the corner – in no small part thanks to Gordon Brown, lest we forget.

As a result, we have avoided the total meltdown that was a real possibility at one point and – except in a few countries, returned within two years to economic growth.

Nonetheless, three problems have arisen.

First, some countries have excessive levels of public debt. They had been profligate in the good times, meaning that they no longer had a margin of manoeuvre for the bad times. Greece is the most blatant case, compounded by fiscal fraud committed by the previous Conservative government there, and now in a very difficult situation.

Second, some smaller countries with large banking sectors suffered immensely when those banking sectors collapsed. Ireland (inside the euro) and Iceland (outside the euro) were the most blatant cases.

Third, some governments are taking deficits as an excuse for an all out assault on the welfare state, dismantling spending programmes with glee. I will leave it to the reader to guess which are the most blatant cases.

None of those three problems are a direct result of the EU policies or euro zone membership. They are a result of national policies and decisions. Nonetheless, they have underlined how interdependent we all are, in the Eurozone, of course, but also beyond, because of the single European market. A default by Greek or Irish banks would have major economic consequences in other EU countries, whether inside the euro or not. Britain, with its large financial sector, is particularly vulnerable and its maintenance of a separate currency is no protection.

That is why the countries of Europe have decided that it is worth coordinating and conferring more than before on their national macroeconomic policies. Strengthened macroeconomic coordination is a necessity. We now know that a housing bubble in Ireland or a banking problem in Germany can very rapidly become everybody’s problem. We have also learned that it is no good to focus just on deficits, but we need to look also at overall debt levels and other macroeconomic imbalances, such as asset bubbles and trade balances.

Indeed, looking at countries’ long-term competitiveness situations, led Germany to propose a “Competitiveness Pact”, on top of the extra co-ordination already agreed . It was, in its initial form, biased towards retrenchment and reductions in wages that made it unacceptable to a large majority of other Member States. It was replaced by a “Euro-plus Pact” put forward by the President of the European Council, Herman Van Rompuy. This was accepted by all but four EU Member States: UK, Hungary, the Czech Republic and Sweden — all currently governed by Conservative parties. All Member States currently governed by socialists signed up for this new version.

This was not because it is a socialist program – that would scarcely be realistic when there is currently an overwhelming majority of centre-right governments. But it is now focused on issues which all governments have to address: how in the long run to make our pension systems sustainable with ageing populations, how to arrange our tax systems in a way that does not mean that countries undermines their neighbours, how to combine fairness and flexibility in the labour market?

There remains much room for political debate on this. The left-right divide in the European Parliament has been accentuated – quite rightly as these are choices between policies, not choices between countries. But there is certainly a greater recognition that the key to the future, as we exit the immediate crisis, is how to improve the medium and long term performance of the European economy. This involves tackling structural problems. We must therefore focus relentlessly on the Europe 2020 strategy with its targets to improve education outputs, investment levels in R&D, poverty reduction, and climate change mitigation. The focus on immediate problems has detracted from the Europe 2020 strategy and we must rectify that balance.

And as to deficits, these are coming down. With immense problems in Greece, Portugal, and Ireland (where there is little choice) and the UK (where there is), but more gradually in most Member States.

The argument is about how this should be done – which is a matter for national decision not for the European institutions. It is up to each country to decide whether to cut expenditure or raise taxes. If cutting expenditure, what to cut, and if raising taxes, what to tax. Those are political battles to be fought at national level.

But in the long run, deficits must be reduced. From a socialist perspective, there is no point in accumulating public debt so that ultimately a higher and higher proportion of public spending goes on servicing the debt (paying a class of rentiers) instead of on public services or public investment. Of course, we must reserve the right to have deliberate counter cyclical deficits at times of economic downturn. But one of the lessons of the crisis is that this will be all the more effective if we have not already built up large debt levels. Keynes always intended “Keynesian” policies to be symmetrical, with deficits in the bad times balanced by surpluses in the good times. Britain didn’t do badly in this respect, thanks to Gordon Brown’s marriage to “prudence” (with Britain’s overall debt levels lower than Germany’s), but as we come out of the crisis we must learn that lesson across the whole of Europe.

The greatest lesson of all, however, is that whether we like it or not, we are all interdependent. Britain’s maintenance of a separate currency does not make it immune. Our trading patterns, our participation in the single European market, the cross-ownership of our banks with those in other EU countries (and the loans and liabilities they have), our involvement in the EU decision-making procedures and our simple geographic location, all mean that any pretence that it has nothing to do with us is futile.

How not to run a referendum campaign.

Jun 14

Posted by James in Elections, Europe, International | 10 Comments

Silvio praysSilvio Berlusconi could be forgiven for feeling confident ahead of yesterday’s referendums (even if there’s not much else he should be forgiven for). The 50% turnout threshold hadn’t been met for more than 15 years, and you might assume this week’s series of votes on closing nuclear power, blocking water privatisation, and letting corruption trials go ahead would go the same way.

But he didn’t trust to luck there. He downplayed them as only an oligarch of his sort can – his TV stations barely mentioned the votes, he didn’t campaign, and he tried to block the votes in the courts. The entire campaign wasn’t about defending nuclear power, water sell-offs, or corruption (I’d have liked to see the posters for that last one), it was about winning by default by keeping turnout low.

Loyal Berlusconi supporters no doubt stayed away rather than voting for nukes, sell-offs and bungs, meaning the overall results all came in at roughly 95% against the government.

The glorious, joyous, wonderful irony. His tactic could hardly have backfired more comprehensively. Even if every single non-voter had turned out and voted for Berlusconi’s positions he wouldn’t have had a prayer: a 95% vote on 57% turnout would have been a 54% vote against him on a 100% turnout (on that assumption). So the game-playing could never have won, and it only ensured the opposition won a victory which seemed disproportionately decisive.

It’s great to see such an extreme example of a negative campaign strategy fail so clearly, and it’s an object lesson against turnout thresholds (not that non-Tory Scots will need any reminding of that). Your time’s nearly up, Silvio. Now let’s close Scotland’s nuclear stations too.

The European Parliament is a very different beast

Jun 9

Posted by Malc in Europe, Media | 4 Comments

On our wee sojourn to Strasbourg, we’ve seen some contrasting sights.

We’ve seen the good – the welcome we have received as “blogger-journalists”, both from those we’ve sought views from as MEPs or press officers, not to mention the lengths the European Parliament’s Edinburgh and London offices have gone to in organising the trip and advising us.

We’ve seen the bad – arriving to a Parliament in the middle of a fire drill (though that perhaps qualifies as more ridiculous than bad).

And we’ve seen the ugly – the very ugly views of some of the more right-wing representatives (including UKIP’s Gerald Batten) on the Roma people in the plenary session on ascension of Romania and Bulgaria into the Schengen area.

Indeed, we were pretty taken aback at some of the contributions made to this debate.  Some of the language used was more akin to what one might hear in the back of a pub after several too many shandies.  On the back of this, we had intended on attending this press conference held by Marine Le Pen, but unfortunately time constraints meant we were unable to make it to that.

I suppose there are a couple of points to make about this.  That there are representatives in the European Parliament who hold such distasteful views is not a surprise, but their candour and forthrightness in delivering them in such an open debate was.  These views are now a matter of public record, recorded for all eternity on the internet.

Of course it should be noted that these ARE minority viewpoints – held, in the main, by MEPs from parties with whom other parties will not condescend to join in European parliamentary groupings – and which were shunned and even booed when recorded in the hemicycle.  Indeed, when a speaker rose to condemn these views and rubbish the claims made by certain far-right MEPs, they were roundly applauded.

The problem, I suppose, is that really no one – well, except for you, intrepid reader – will actually discover that such views are held and declared in Europe’s Parliament.  The mainstream media – television and newspapers – particularly in Scotland have ceased to report even semi-regularly from the European Parliament.  The result of this is that the words spoken by MEPs in plenary sessions or in press conferences seldom make it back across the English Channel to these shores.  There are instead lost in the maze of official reports on the Parliament’s website.  Which is probably why these MEPs feel safe enough using such language – because they are not fully held accountable for these views by our media.

So yes – one of our discoveries about the European Parliament is the candour with which representatives discuss topics.  There’s much less of a fear of offending potential voters here – which, in some cases, could be a positive if it contributed to a more frank and honest exchange of views.  Instead it provides cover for the far-right to espouse views their own electorate would likely find abhorrent.

That’s one of the paradoxes at the heart of the European Parliament – it is certainly the most transparent EU institution, and perhaps more transparent than some national and sub-national legislatures – and yet it is the institution in which that transparency makes little or no difference, since no one bothers to check what their representatives are doing.

As a visual illustration of just how different the European Parliament is to what we are used to in the UK, here’s a classic clip (YouTube) of then MEP Rev Ian Paisley protesting the arrival of the Pope into a plenary session of the EP in 1988.

– blogged from the European Parliament’s media centre in Strasbourg

 

EXCLUSIVE: Greens urge Italians to vote Si on Sunday against nuclear energy

Jun 8

Posted by The Burd in Environment, Europe | 5 Comments

Green MEPs, Daniel Cohn-Bendit (France) and Rebecca Harms (Germany), today urged the Italian population to vote ‘si’ in Sunday’s referendum on nuclear energy, claiming that a yes vote rejecting nuclear power as an energy option for Italy, would start a “snowball effect” across the rest of Europe.

Cohn-Bendit pointed out that the referendum was the first in Europe on this issue and urged the Italian people to vote in order to give all European citizens a better future.

Harms outlined how a majority of European citizens now opposed nuclear energy – a view that had grown since the Fukishima tragedy in Japan earlier this year.  And she listed all the countries rejecting nuclear power.  It was not only Germany who had recently moved to phase out nuclear power but a whole host of countries had never chosen the nuclear route, including Ireland, Denmark, Austria, Spain, Greece, Portugal, Switzerland and Belgium.

Poland is also due to hold a referendum and France is debating the issue afresh.  With elections due in France, Germany and Italy in the next three years, the Green MEPs argued that we could shortly reach a position where there are three governments “at the heart of Europe” adopting an anti-nuclear stance and that this would send a “strong message” to nations around the world.

The MEPs suggested there were sound fiscal reasons to reject nuclear power.  It would cost Italy at least 700 million Euros to earthquake “proof” any nuclear installations.  Fundamentally, the country’s topological and geological make up made it inherently unsuitable for nuclear power plants.

Moreover, Cohn-Bendit highlighted the “inherent contradiction” at the heart of UK policy on nuclear energy.  Its position of including nuclear power in the mix for future energy provision was predicated on such development being privately funded and not involving public funding.  The Green MEP claimed this was impossible to do.  Experience in Japan showed that even with private investors, public funding was still required and frankly, the UK Government did not have the money to do this in the current financial climate.

While the fiscal issue is a key one, it is also clear that the UK is travelling in the wrong direction on this important issue from its fellow EU members.  The future is bright, it would appear, and it does not include nuclear.

So long as the Italians do indeed vote si on Sunday.

– blogged from the European Parliament in Strasbourg –

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