Social Europe

  • EU Forward Project
  • YouTube
  • Podcast
  • Books
  • Newsletter
  • Membership

A British Bridge For A Divided Europe

Robert Skidelsky 20th April 2016

Robert Skidelsky

Robert Skidelsky

The European Union has never been very popular in Britain. It joined late, and its voters will be asked on June 23 whether they want to leave early. The referendum’s outcome will not be legally binding on the government; but it is inconceivable that Britain will stay if the public’s verdict is to quit.

Over the years, the focus of the British debate about Europe has shifted. In the 1960s and 1970s, the question was whether Britain could afford not to join what was then the European Economic Community. The fear was that the United Kingdom would be shut out of the world’s fastest-growing market, and that its partnership with the United States would be at risk as well: The Western alliance would consist of two pillars, and Europe, not a shrunken Britain, would be one of them.

Today, it is the enfeeblement, not power, of Europe, that drives the UK debate. The British perceive themselves as doing rather well, whereas Europe is doing badly. Indeed, ever since the 2008 crash, the EU has been identified with failure. Outside Britain and Germany, there has been almost no economic growth. It cannot defend its frontiers against terrorists (“Europe is not safe,” proclaims Donald Trump). Its institutions lack legitimacy. Made up of 28 quasi-sovereign members, it cannot act, but only issue intentions to act. No wonder there is a move afoot to reclaim national sovereignty, where some decision-making power still resides.

The EU’s fate has become hopelessly entangled with that of its most vulnerable feature: the 19-member eurozone, the single-currency heartland of economic stagnation. To officials in Brussels, the eurozone is the EU. Only Britain and Denmark have been allowed to opt out. The other members, including Sweden, are expected to join when they meet the criteria. The eurozone was to be the engine of political union. But the engine has stalled.

To be sure, the 2008 crisis started with the banking collapse in the US. But most of the rest of the world has recovered, whereas most of Europe has not. To assess why, a recent symposium on the subject at Nuffield College, Oxford, focused on the lack of a sovereign authority able to protect the European economy as a whole from contagious crises starting elsewhere. The missing bits of sovereignty include a fiscal transfer system to respond to asymmetric shocks; a risk-free asset (eurobonds) in which to park redundant money; a single system for supervising banks and capital markets; a central bank able to act as lender of last resort; and the ability to organize an EU-wide stabilization/recovery program.

The eurozone has weakened the nation-states comprising it, without creating a supranational state to replace the powers its members have lost. Legitimacy thus still resides at a level of political authority that has lost those attributes of sovereignty (such as the ability to alter exchange rates) from which legitimacy derives.

Meanwhile, promises of action continue to flow. The so-called Five Presidents’ Report calls for “completing Europe’s economic and monetary union” as a prelude to “political union.” But is that the right sequence? Historically, political union precedes economic and monetary union. As Otmar Issing, a former ECB chief economist, never tires of pointing out, without a sovereign, the process of transferring competences – including monetary policy – to ever higher levels will create a huge legitimacy deficit.

The EU has tried to achieve political union incrementally, because it was impossible to start with it. Indeed, barely hidden in the “European project” was the expectation that successive crises would push political integration forward. This was certainly Jean Monnet’s hope. The alternative – that the crises would have the opposite effect, leading to the breakup of the economic and monetary union – was never seriously confronted.

Few people in the UK would welcome a rapid move toward a political union, assuming this means filling in the gaps in sovereignty that have crippled the eurozone. Indeed, in the deal that Prime Minister David Cameron negotiated with European heads of government as a condition of remaining in the EU, Britain is specifically exempted from commitment to “ever closer political union.” Yet, without a political union, it is hard to see how the eurozone can be made to work.

The eurozone is therefore likely to break up into more compatible parts, after further failed efforts to muddle through. One can imagine a northern single-currency area, with enough sovereignty (provided by Germany or, more plausibly, by Germany and France acting together) to make it work, linked by free trade to a southern area that is not subject to the northern bloc’s monetary and fiscal rules. Specifically, members of the southern bloc would have fixed, but adjustable, exchange rates with one another and with the northern union.

The southern bloc, however, would lack a member with the weight and prestige to counterbalance Germany. That member could only be Britain. And this is the main argument against pulling out of the EU: By staying in, Britain would be able to ensure that, if and when the eurozone’s breakup comes, the process is not too messy, and will at any rate preserve something of the spirit of the EU’s founders. Britain has much to fear from an acrimonious divorce, as it will inevitably be swept into its turbulent wake.

It has always been part of Britain’s role to act as a bridge between different worlds. It can play this role in the two Europes of the future, but only by not cutting itself off from the one Europe that currently exists.

© Project Syndicate

Robert Skidelsky
Robert Skidelsky

Robert Skidelsky is a member of the British House of Lords, Professor Emeritus of Political Economy at Warwick University, and the author of a prize-winning three-volume biography of John Maynard Keynes. He began his political career in the Labour party, was a founding member of the Social Democratic Party, and served as the Conservative Party’s spokesman for Treasury affairs in the House of Lords until he was sacked for his opposition to NATO’s 1999 bombing of Kosovo. Since 2001, he has sat in the House of Lords as an independent.

Harvard University Press Advertisement

Social Europe Ad - Promoting European social policies

We need your help.

Support Social Europe for less than €5 per month and help keep our content freely accessible to everyone. Your support empowers independent publishing and drives the conversations that matter. Thank you very much!

Social Europe Membership

Click here to become a member

Most Recent Articles

09d21a9 The Future of Social Democracy: How the German SPD can Win AgainHenning Meyer
u42198346 How Trump’s Tariff Regime Fuels Global OligarchyGabriel Zucman
u421983462 041df6feef0a 3 Universities Under Siege: A Global Reckoning for Higher EducationManuel Muñiz
u4219836ab582 af42 4743 a271 a4f423d1926d 0 How Trade Unions Can Champion Solidarity in Europe’s Migration DebateNeva Löw
u421983467298feb62884 0 The Weak Strongman: How Trump’s Presidency Emboldens America’s EnemiesTimothy Snyder

Most Popular Articles

u4219834647f 0894ae7ca865 3 Europe’s Businesses Face a Quiet Takeover as US Investors CapitaliseTej Gonza and Timothée Duverger
u4219834674930082ba55 0 Portugal’s Political Earthquake: Centrist Grip Crumbles, Right AscendsEmanuel Ferreira
u421983467e58be8 81f2 4326 80f2 d452cfe9031e 1 “The Universities Are the Enemy”: Why Europe Must Act NowBartosz Rydliński
u42198346761805ea24 2 Trump’s ‘Golden Era’ Fades as European Allies Face Harsh New RealityFerenc Németh and Peter Kreko
startupsgovernment e1744799195663 Governments Are Not StartupsMariana Mazzucato
u421986cbef 2549 4e0c b6c4 b5bb01362b52 0 American SuicideJoschka Fischer
u42198346769d6584 1580 41fe 8c7d 3b9398aa5ec5 1 Why Trump Keeps Winning: The Truth No One AdmitsBo Rothstein
u421983467 a350a084 b098 4970 9834 739dc11b73a5 1 America Is About to Become the Next BrexitJ Bradford DeLong
u4219834676ba1b3a2 b4e1 4c79 960b 6770c60533fa 1 The End of the ‘West’ and Europe’s FutureGuillaume Duval
u421983462e c2ec 4dd2 90a4 b9cfb6856465 1 The Transatlantic Alliance Is Dying—What Comes Next for Europe?Frank Hoffer

Foundation for European Progressive Studies Advertisement

Spring Issues

The Spring issue of The Progressive Post is out!


Since President Trump’s inauguration, the US – hitherto the cornerstone of Western security – is destabilising the world order it helped to build. The US security umbrella is apparently closing on Europe, Ukraine finds itself less and less protected, and the traditional defender of free trade is now shutting the door to foreign goods, sending stock markets on a rollercoaster. How will the European Union respond to this dramatic landscape change? .


Among this issue’s highlights, we discuss European defence strategies, assess how the US president's recent announcements will impact international trade and explore the risks  and opportunities that algorithms pose for workers.


READ THE MAGAZINE

Hans Böckler Stiftung Advertisement

WSI Report

WSI Minimum Wage Report 2025

The trend towards significant nominal minimum wage increases is continuing this year. In view of falling inflation rates, this translates into a sizeable increase in purchasing power for minimum wage earners in most European countries. The background to this is the implementation of the European Minimum Wage Directive, which has led to a reorientation of minimum wage policy in many countries and is thus boosting the dynamics of minimum wages. Most EU countries are now following the reference values for adequate minimum wages enshrined in the directive, which are 60% of the median wage or 50 % of the average wage. However, for Germany, a structural increase is still necessary to make progress towards an adequate minimum wage.

DOWNLOAD HERE

S&D Group in the European Parliament advertisement

Cohesion Policy

S&D Position Paper on Cohesion Policy post-2027: a resilient future for European territorial equity”,

Cohesion Policy aims to promote harmonious development and reduce economic, social and territorial disparities between the regions of the Union, and the backwardness of the least favoured regions with a particular focus on rural areas, areas affected by industrial transition and regions suffering from severe and permanent natural or demographic handicaps, such as outermost regions, regions with very low population density, islands, cross-border and mountain regions.

READ THE FULL POSITION PAPER HERE

ETUI advertisement

HESA Magazine Cover

What kind of impact is artificial intelligence (AI) having, or likely to have, on the way we work and the conditions we work under? Discover the latest issue of HesaMag, the ETUI’s health and safety magazine, which considers this question from many angles.

DOWNLOAD HERE

Eurofound advertisement

Ageing workforce
How are minimum wage levels changing in Europe?

In a new Eurofound Talks podcast episode, host Mary McCaughey speaks with Eurofound expert Carlos Vacas Soriano about recent changes to minimum wages in Europe and their implications.

Listeners can delve into the intricacies of Europe's minimum wage dynamics and the driving factors behind these shifts. The conversation also highlights the broader effects of minimum wage changes on income inequality and gender equality.

Listen to the episode for free. Also make sure to subscribe to Eurofound Talks so you don’t miss an episode!

LISTEN NOW

Social Europe

Our Mission

Team

Article Submission

Advertisements

Membership

Social Europe Archives

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Miscellaneous

RSS Feed

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641