Reviving The Franco-German Tandem

The European Union will soon be faced with the start of Brexit negotiations. How did you experience the referendum, and what were the key drivers behind the decision to leave the EU?

In my view, the referendum was primarily a political decision, made by the Conservative government, to ensure that they could enter their national elections with a united Conservative position. It was the key for David Cameron to secure a good outcome to his general election campaign.

Now, it’s also the case that the UK has always been, as somebody put it, one foot in and one foot out of the EU. The UK has largely focused on the trade aspects, while being more sceptical about the political commitments.

They are now one foot out and one foot in.

In my view the key drivers behind the vote were more cultural and institutional than economic. There was a strong belief among a lot of people that they could regain sovereignty in terms of migration but also for commercial and supervisory rules as well as trade relationships with the entire world. That is very different from the US protectionist vote.

It also looks like there’s a bit of a lack of understanding of how the EU works, with still some belief that you can negotiate around things, when the Treaty is actually a very strong, legal framework, and doesn’t give you much freedom of manoeuvre. It enshrines a lot of rules governing the relationship between countries. There was a bit of a, yes, misunderstanding of how the EU works.

What have been the reactions since June in France, and who do you think will benefit domestically from that decision? Would it be Marine Le Pen of the Front National, or might it strengthen the hand of the leading alternative contender, Emmanuel Macron, for instance?

I think France is a very different political animal in Europe to the UK. As you know, the French believe a lot more in politics than in economics, and Europe has always figured in their spectrum of political belief, even if the relationship with European construction has not always been smooth.

Yet even today, different opinion barometers or polls show that about two thirds of the French still want to keep the euro and stay in the EU; there is a strong attachment to the European Union. There has always been a debate between federalists and non-federalists. What this means is that people always had a political position on Europe. Instead of being about one foot in or one foot out, it’s rather a bit more of a love/hate relationship.

Against this backdrop, I don’t think Brexit is having much impact on the French election. There’s always been a debate on Europe. There has been more division recently, since the European constitutional referendum in 2005, when it appeared that each party, each of the main parties, the Socialist Party and the conservatives, were divided on European issues. In both parties, you will find pro- and more sceptical Europeans.

In fact, your question is really good because today the two main contenders are precisely divided along European and globalisation lines. Emmanuel Macron’s party or movement is strongly in favour of Europe, Marine Le Pen’s against. In my view, Emmanuel Macron’s position is very balanced. There’s a part of the population which will align to his European position. You always have a lot of European flags at his meetings. He’s made it a selling point of his campaign.

As you know, for a long time, the Franco-German axis has been the driver of European integration. Do you think that against the backdrop of the Brexit decision, with the elections coming up in France, and very soon in Germany, this engine of European integration can be restarted, and will the potentially revived Franco-German axis be capable of leading the remaining 27 member states in the Brexit negotiations?

To me, yes, this engine can be restarted, for several reasons. The first one is I think Germany doesn’t like being by itself, at the top of the leadership tree of Europe.

Correct me if I’m wrong, but from what I’ve seen in my time in government, it was always a preliminary with issues that France and Germany knew each other’s position, and even better when they converged on a position. If, conversely, there was divergence like, for example, with France not wanting to change the Treaty, then Germany would not insist.

It seems to me that Germany’s still waiting for France to become a more active player, making positive proposals, than it has been in the past, and the ball is really in the French camp. If France ends up, for example, with Emmanuel Macron and a pro-European position and some concrete proposition, then Germany will be happy to enter into a dialogue.

The Franco-German couple may have suffered a bit, or may have been a bit more loosely tied together over the past few years, but I think it would be quite easy to revive this tandem.  It really depends on who becomes the next French leader, that’s the first thing.

The second one is that from what I’ve seen, really France and Germany are in the driving seats. Usually, they take with them Italy and Spain, and then they really have a strong, a powerful, coalition.

Let’s just assume that this engine can be restarted, can you think of any specific initiatives that Germany and France could start together to restart or stop the erosion of European integration, and maybe also break the deadlock in Eurozone reform?

What would be particularly useful would be for France and Germany to really achieve something together, and then that could overcome the deadlock in Eurozone governance. Really, the deadlock is coming from the strong divide between the north and the south on economic policy.

Let’s assume France and Germany, for example, decide to have common labour market laws – that would be hugely powerful, first to ease the flow of human capital but also they would be seen more as moving forward with integration. If these two countries had common labour market laws, it’s quite likely that this would trigger an appetite for (other) countries to join this party.

There is corporate taxation convergence as well, which could mean a lot to both. If, again France and Germany can converge on the same rate of corporate tax, this would entice others to join.

Then, the third thing, which I believe is important, is defence. There’s something very symbolic, but if they decided to put in common defence logistics as an objective in terms of what they can achieve together, then that would also be quite powerful.

Of course, we all know what needs to be done to consolidate the Eurozone; this is above all about sending a political signal and giving a renewed impetus to the European Union.

If you leave the Franco-German focus for a moment, and look at the European Union in a wider context, what are your expectations regarding the outcome of the current ‘Bratislava reflection phase’, and especially with an expected declaration to mark the 60^th anniversary of the Treaty of Rome at the end of March? What kind of outcome would you wish for?

Bratislava, I’m not sure it will deliver a lot, because from a political viewpoint, what can you expect when the top leaders of the EU (Merkel and Hollande) are in election campaigns? For that project to deliver, it would have been better to deliver it to leaders who could agree on the objectives, on what there is to say, take it with them, make it a political project, and work on it for the next three to five years. That’s obviously not going to happen.

You expect it will be just symbolism because effectively, France and Germany are in election mode and they’re not in a position to announce any major project at the moment?

Even if they did announce one, the guy after them might not want to do it. If I had been the European Commission president, I would probably have waited until November, try and agree on something with the new French and German leaders, and then it would have gained a lot of political traction. That said, the Juncker White Paper is open enough, and with such a large number of scenarios, that it puts the political ball back into the hands of the next EU (French and German) leaders. They’ll have to run with it.

This is an edited version of an interview conducted by Henning Meyer, editor-in-chief, Social Europe. It is the latest contribution to a new Social Europe Project on ‘Europe after Brexit’ organised in cooperation with the Macroeconomic Policy Institute of the Hans Böckler Stiftung and the Bertelsmann Stiftung.