Now For The Double Whammy

Actually with the critical ECB meeting looming on Thursday, it could in fact be more like a ‘trifecta’ than a ‘double whammy’. Anyway, however you classify things, on Wednesday it will be the turn of the Netherlands. My impression is that the politicians don’t know quite how to respond.

Incidentally, with so much news coming in so fast, we will be directing most referendum information posts to our other page: A Few Euros More.

According to De Telegraaf Dutch Prime Minister is ‘disappointed’:

Prime Balkenende “has been disappointed” by the French ‘ no ‘ against the European constitution. He stated he had rather expected a positive result on Sunday evening. Balkenende called Dutch voters to vote ‘yes’. We should not our laws to be made by the French.

Frans
draws our attention to an interesting post on the Dutch blog Steeph, and also writes:

“pm Balkende is disappointed. The quote is quite remarkable. It says “We should not let the French tell us what to do”. www.nu.nl had a more elaborate comment that even included “the Dutch should teach them a lesson”

Mr Aartsen (leader of the coalition party VVD) had a remarkable comment too:
Nederland krijgt volgens hem nu de kans door een overtuigend ‘ja’ volwaardig mee te beslissen hoe verder te gaan met de Franse republiek. “Now the Dutch have the chance with a clear yes to decide on how to deal with the French republic”

Mr maaten VVD-MEP had a wiser comment mentioning that apparently the people in the bigger countries do not have the idea that they are better of with the treaty.

My feeling (Edward) Is that the impact of the vote is going to be made much worse by the way European leaders are responding. I have just been listening to Josep Borrell (Catalan President of the European Parliament) interviewed on France info: “business as usual” is the line.

I thing this is a clear case of Ostrich-itis. The point *isn’t* that this puts all of Europe into crisis. This is not necessary. But ‘crisis’ can only be avoided by recognising openly and clearly that something has gone wrong. The EU leaders are not carrying the EU voters with them on the constitution, and a dialogue must begin. The sooner this is recognised the better. I would say Thursday morning would be an important ‘waterline’. Everything points to a Dutch no, and a need for a real change of course in the way we handle things.

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About Edward Hugh

Edward 'the bonobo is a Catalan economist of British extraction. After being born, brought-up and educated in the United Kingdom, Edward subsequently settled in Barcelona where he has now lived for over 15 years. As a consequence Edward considers himself to be "Catalan by adoption". He has also to some extent been "adopted by Catalonia", since throughout the current economic crisis he has been a constant voice on TV, radio and in the press arguing in favor of the need for some kind of internal devaluation if Spain wants to stay inside the Euro. By inclination he is a macro economist, but his obsession with trying to understand the economic impact of demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again".

21 thoughts on “Now For The Double Whammy

  1. “Now the Dutch have the chance with a clear yes to decide on how to deal with the French republic”

    I mentioned this argument jokingly on my blog. Little did I know that someone would seriously consider ‘punishing’ France by isolating it politically. In any case I believe that France made itself vulnerable. A resounding ‘Nee’ of the Dutch would soften the blow and legitimize the French non, I believe.

  2. Reading the comments above it begins to sound as a football match France-Nederland.
    I would prefere that the Dutch public will vote for the EU constitution as such and not as an unswer to the French NO.

  3. Reading the comments above it begins to sound as a football match France-Nederland.
    I would prefere that the Dutch public will vote for the EU constitution as such and not as an unswer to the French NO.

  4. Maciek, I agree. But the French non has now, and not unexpectedly, turned into cannon fodder. In any case my perception is that the Dutch ‘nee’ was already consolidated before the French ‘non’.

  5. “My feeling (Edward) Is that the impact of the vote is going to be made much worse by the way European leaders are responding.”

    Exactly. For example:

    “President Jose Manuel Barroso, while conceding the outcome was a ‘serious problem,’ insisted: ‘We cannot say that the treaty is dead.’ . . . The constitution’s main architect, former French President Valery Giscard d’Estaing, said countries that reject the treaty will be asked to vote again.”
    http://www.guardian.co.uk/worldlatest/story/0,1280,-5040555,00.html

    Oh deary me.

    Notice that this report is by an Associated Press writer, not a regular Guardian correspondent.

  6. “But the French non has now, and not unexpectedly, turned into cannon fodder.”

    I think this issue is also important. Undoubtedly the French to some extent voted about internal issues (and of course, a political settling of accounts is now in progress with Raffarin the first casualty, although we will also have to see if Francois Hollande can survive), but they also expressed opinions which are widely shared across Europe (not by me, in terms of the ‘no’), so….

    I think the first way out of this is to recognise the facts. That EU citizens are not with their leaders on the way unification is being handled.

    This means that the Dutch, and the Danes (if it went that far) should vote as European citizens, as they feel. And what we need isn’t the football match response we see in some Dutch political statements, but a calm and serious discussion.

    What I’m trying to say, and I feel I am not doing this very well, is that we shouldn’t be thinking “we’re not stopping this just because the French don’t want it”. A process like EU unification is only possible if there is the maximum consensus, across all the countries, and this consensus is evidently lacking.

    So, and there is no other viable and responsible way, it’s back to the drawing board.

  7. Back to the drawing board it may be, but the questions of how many countries don’t agree, by what margins and for what reasons are all important. The French referendum doesn’t answer the first at all, addresses the second for one country in 25, and provides only limited information about the third.

    Whatever steps come next, it makes quite a bit of difference whether there are 20 countries in favor, 2 against and 3 uncertain, or whether the ratio is more like 12 in favor 7 against and 6 uncertain. So far, we have nine in favor, one against and Belgium half-way (one chamber of Parliament has voted, the other hasn’t yet).

    Almost any way you slice it, the countries should keep going with their national processes. Or did French voters suddenly acquire the power and the right to dictate to, say, the Estonian parliament?

  8. “So far, we have nine in favor, one against and Belgium half-way (one chamber of Parliament has voted, the other hasn’t yet).”

    Look Doug, I’m in favour of having some form of EU constitution, but I think this way of arguing is only going to make matters worse.

    We have with a popular vote one in favour (Spain) and one against (France). In Spain the participation was only 45% and in France it was 70% odd. So the French vote has quite a lot of legitimacy. The margin was big, and the participation was high.

    Then we have the parliaments: 7 have voted in favour. I don’t know how to assess these two different procedures in terms of legitimation.

    In particular I am worried about Germany. OK, the German parliament has voted. But, as I understand it, German law doesn’t allow a referendum. And if there was one, can we be sure the Germans would vote in favour?

    Really we need a consistent way to vote these things in the future. Everyone with the same procedure, and carrying it through in the same time frame. Otherwise we are comparing apples and pears.

    Back to the drawing board doesn’t mean throwing the towel in. It means a period of reflection, consultation, and a new initiative, one that has a real consensus behind it. And if you can’t get a sufficient consensus, then you aren’t going to have political union.

    Chirac is off to Brussels in early June, to see Barroso and ‘renegotiate’.

  9. “see if Francois Hollande can survive”

    I hadn’t thought about the irony of this today, but FH is the leader of the French socialist party: the PS. He backed the ‘yes’ very strongly, and it is hard to see him leading the party into the 2007 elections.

    The point is this vote exists on two levels, a French one, and a European one.

  10. In particular I am worried about Germany. OK, the German parliament has voted.

    Technically speaking ratification of a treaty is a presidental function. Parliament has to authorize him. The president hasn’t signed yet. Until then parliament could change its mind or the authorization be challenged before the constitutional court.

    But, as I understand it, German law doesn’t allow a referendum.

    Ratification required a constitutional change. Had they wanted, it would have been possible.
    Which shows that giving an institution the right to set its own powers is dangerous.

    And if there was one, can we be sure the Germans would vote in favour?

    No. After yesterday, are you serious?

  11. “Then we have the parliaments: 7 have voted in favour. I don’t know how to assess these two different procedures in terms of legitimation.”

    Assessing them in terms of national political culture is probably too obvious to need saying, but there it is. The different countries have different approaches, as you’ve pointed out, and forced harmonization would, I think, be harmful. The only time I could see a problem is if a country has a strong tradition of referendums, but doesn’t hold one on this issue. The converse might also be true.

    “German law doesn’t allow a referendum. And if there was one, can we be sure the Germans would vote in favour?”

    This is true at the national level. Referendums were rather badly misused from 1933 to 1945, so the framers of the Basic Law decided that an unmixed representative government was the way to go. German assent to the constitutional treaty was taken in a way that is consistent with all of Germany’s postwar political culture. If anything, the constitutional treaty is less controversial than, say, NATO entry in 1955, or the Pershing II decisions in the mid-1980s, neither of which was decided by referendum.

    My point here is stare decisis. EU member states have established practices for deciding questions like the constitutional treaty. They should stick with them.

    “So the French vote has quite a lot of legitimacy.”

    Yes, but only for France.

    “but I think this way of arguing is only going to make matters worse. ”

    My issue with this quote and the previous one is that we genuinely don’t know what the preferences are in the other countries. Of course the French vote will affect those preferences to some extent, as did ratifications in other places. And so going back to the drawing board without knowing what the appropriate authorities in other places think could just as easily miss the opportunity for consensus.

    The French who voted no may be the mainstream of Europe, or they may be outliers. But they are not a priori either. The days when a French decision was by definition directional for the EU (or its predecessors) are over, which is one of the reasons yesterday’s vote went as it did.

    Without knowing what Danes, or Poles or Swedes or Cypriots (or their representatives) for example think about the constitutional treaty, the EU is casting about in the dark. Or at the very least, doing without important information.

    These are still incomplete thoughts; maybe I’ll put something up this evening.

  12. And so going back to the drawing board without knowing what the appropriate authorities in other places think could just as easily miss the opportunity for consensus.

    There is none. The results of the votes so far are mutually exclusive. Waiting now means that the time is wasted.

  13. I can only think of one reason why German would hold a referendum. It is also why you would expect a no in that case

  14. If experience is any guide to the likely future, Eurocrats will go into serial denial – this is a blip – an inconvenience – nothing changes – press on regardless – too much is at stake – the Treaty cannot be renegotiated – dissident electorates will come to their senses in due course – they must vote again to give the correct answer.

    At the end of George Orwell’s Nineteen Eighty-Four, Winston Smith concludes that he loves Big Brother after all.

    “He gazed up at the enormous face. Forty years it had taken him to learn what kind of smile was hidden beneath the dark moustache. O cruel, needless misunderstanding! O stubborn, self-willed exile from the loving breast! Two gin-scented tears trickled down the sides of his nose. But it was all right, everything was all right, the struggle was finished. He had won the victory over himself. He loved Big Brother.”

    http://www.online-literature.com/orwell/1984/23/

  15. France, The Netherlands and UK. We can count on at least three countries out of the game by week-end.

    Please gentlemen stop this agony. We don?t deserve so much pain because of a devalued treaty that is just the spectre of a failed federal constitution. Please make a brand new treaty, devoid of “grandeur” and full of consensus.

  16. Much good sense in that, Gulliver. A less ambitious treaty – or series of treaties – may well succeed in gaining the consensus in the EU needed for adoption but there are fundamental contradictions to overcome among those who oppose the present treaty.

    It has been observed often enough that the successful “No” camp in France was an unholy alliance between Dirigiste Socialists and Ultra-nationalist Xenophobes who otherwise have little in common politically beyond authoritarian tendencies and their opposition to the present treaty.

    In Britain, the unifying theme of opposition is that the treaty could become the means of imposing a scale of unwanted dirigisme under the cloak of EU harmonisation that would undermine the many benefits to economic performance achieved through market liberalisation, some painfully.

    Besides that, a majority of Brits have no wish to be absorbed into a European state where important decisions are made in remote places and when there is little opportunity to reserve course after recognisably bad decisions were made – the claims being made about the “impossibility” of renegotiating the present treaty are an excellent example of just this.

    Tony Blair has recently said that already about half of UK legislation impacting on business derives from EU primary legislation and there are many here who, with reason, do not regard that as reassuring after they have seen the official statistics showing the higher rates of both unemployment and inflation in the Eurozone compared with Britain, as well as the slower rate of GDP growth.

    Data like that speak eloquently, sufficiently so to make many of the claims made about the European project look rather like over-selling. Many here have good cause to recall the terrible consequences that were supposed to befall Britain if we failed to join the Euro. As it is, it is starting to look as though we had a lucky escape. Some have noticed too that the Swiss economy, outside the EU and the Eurozone, is also doing relatively well.

    There is perhaps rather more hope for a constitutional treaty that leaves more scope for national decisions within a framework of abolishing trade barriers in Europe and the principles for making Europe-wide decisions when necessary.

    It is hugely significant that there is a broad agreement between many EU governments that Commission spending should not exceed 1% of the EU’s combined GDP. It would also facilitate better public relations when the Commission manages to get the European Court of Auditors to approve the Commission’s annual accounts – for a change.

    Vive subsidiarity!

  17. “Besides that, a majority of Brits have no wish to be absorbed into a European state where important decisions are made in remote places and when there is little opportunity to reserve course after recognisably bad decisions were made”

    I would say (and I hope not just on behalf of the Brits, see eg Davids posts, or Frans) that people may not want to be absorbed in a EU where important decisions are made in remote places, with little possibility to reverse course *and* where our leaders either tell us the sun orbits the earth (the ECB and the one size fits all dogma) or that the earth is – in fact – flat (the ratification process will continue, a majority of states are in favour etc etc).

    Sorry if I’m hitting you head on here Doug, but I really do feel pretty strongly about this, since I think it is precisely this kind of thing which *weakens* the EU.

  18. Many thanks for correcting my silly typo by substituting “reverse” for “reserve”.

  19. Edward, I don’t feel hit on the head. That ECB rates are not ideal for all members of the monetary union has been, as you know, well known since long before its start. All the governments and central banks went into it with eyes wide open on this topic. The alternative, I submit, was and is monetary policy made in Frankfurt by the Bundesbank. The UK is the sole exception (and inasmuch as monetary policy made by the Old Lady of Threadneedle would carry Ireland along in its wake, there, too), as it is now. Spain, for example, would pay a risk premium for not being Germany, but it would no more have independent monetary policy than it does now. The smaller Central European economies have a dispensation that will last a few more years because they are still seen as in transition. Once they are regarded as regular, small European countries, financial markets will no more expect an independent monetary policy from them than they do from Belgium.

    On the constitutional treaty, riddle me this: What is the Estonian view? The Danish view? The Swedish view?

    My point, and I grant that it is a limited one, is that we don’t know. And if those countries stop now, we will never know.

    On the other hand, what is it about French voters that privileges their views over the views of some 230 million other EU citizens whose representatives have already voted? Are the French super-class Europeans who matter more?

    On the UK position, Tony Blair didn’t get to be Tony Blair without forcing peoples’ hands. That’s one aspect of what he’s just said. Another is the word ‘suspension’, which I am sure was very carefully chosen. Any British referendum is about a year away, an eternity in politics. By ‘suspending’ consideration now, Blair gains time, takes the initiative just before the UK presidency of the EU, and loses precisely nothing.

    But let’s turn the questions in another direction. What’s better? Another IGC? Another two or three years spent getting what we’ve got today? Two or three smaller treaties, each with its own ratification process? (Ask the Poles how well the whole mała konstitucja thing went.)

    It seems to me that people who are opposed to the constitution should say how they would fix the Union’s problems, particularly given coming rounds of enlargement.

    And if there’s anyone out there who thinks enlargement should stop now (I don’t include you among these ranks, Edward), I’d be keen to hear a principled reason why Slovenes can be EU members and Croats never can; likewise for Greeks versus Bulgarians.

    So far, the burden has been on the pro-constitutional treaty side to say why that option is better than the alternative. Now that things are much more up in the air, the anti side ought to spell out what they want.

  20. On the other hand, what is it about French voters that privileges their views over the views of some 230 million other EU citizens whose representatives have already voted?

    The law, if you will. We have a valid treaty, the treaty of Nice, which the members agreed to. Some want to depart from that. The onus is on them. The EU has no business in determining its structure as it is a creature of treaties, nothing more. You may see this constitution as an attempt to change that. It has failed to do that.

    The others have any right to do as they wish, in effect expelling France, probably the Netherlands, likely some others. That would be the end of the EU.

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