Friday, May 20, 2005

Constitution or Hong Kong

Yesterday the Belgian Senate approved on the European ‘Constitution’. Still five other Belgian parliaments to go. The latest referendum polls in France and the Netherlands show the no-camp in the winning mood. But what really matters is may 29th, the date of the French referendum.

France is since its foundation the leading factor in the European Union. France rejected the European defence community in 1954. It never reappeared. If France rejects the further centralisation of power in the EU, this will stop.

If the French vote no, what will happen? All of Europe’s leaders deny that there is a “plan B”, in order to overcome a possible no-vote in France. Of course they are not the very most reliable source.

On june, 16th, there is a European summit in Luxembourg. The result of the referendum in the Netherlands on june 1st, will only be of minor influence. If France rejects the Constitution, two things could be decided there.

Or the European leaders decide that the European Constitution project will continue, and hope that most of the referendums in Luxembourg, Poland, Denmark, Portugal, Ireland, the Czech Republic and the UK will turn out with a yes. After, the no-countries, can have their second chance referendum. This is of course unlikely to happen. A French no will be of big influence in the Netherlands, Poland, Denmark and Ireland, rather eurosceptic countries. And it will be hard for the European leaders to change the feelings.

The other option is that the European leaders declare the European Constitution project dead. In that case there won’t be a referendum at all in Britain, where Blair managed to keep the European topic out of the election campaign by promising a referendum. Then the EU will have to keep on working with the present procedure of the Treaty of Nice, which makes it more complicated to make decisions. The Union will still be able to pursue its regulatory madness. Politically though, it will be a great defeat of Eurocentrism.

Suppose the French vote yes on may 29th , and at the moment when the British vote no, in 2006, there will be only one other country, for example the Netherlands, that also voted no. Unlike which was the case with the Treaty of Maastricht, where the UK and Denmark obtained an opt-out for the third phase of the EMU, it won’t be so easy to give opt-out privileges for some essential features of the Constitution Treaty, as the core of this Treaty is the more easy procedure to make decisions, and it is of course not possible to opt out of that.

But what is even more likely, is that in a not so distant time, the understanding in Europe will be present that the world is changing. The European population is coming more and more to the understanding that the next big thing which should happen is not a centralisation of Europe. China and India are becoming economic superpowers. They are putting a high competitive pressure on the West. The European population will come to understand that other reforms will need to be made. Labour deregulation, tax reduction, privatisation, more efficient government. The European Union is with its bureaucratic structures highly unfit to achieve these goals, despite its own rhetoric. Europe can only face global economic competition if it decentralises decisions, in order to become a continent with flexible, small scale, business orientated governments, following the great example of Hong Kong.


Anonymous said...

Hong Kong is today part of China and who knows what will happen to Taiwan in the future. I am not convinced that example of Hong Kong is the good one.
One of the strength of Hong Kong was to be very close to huge China and to be quite small in itself. This is not the case of Europe and we will be soon half milliard people. Obviously China, India, Japan and US will be our partners for time to come to deal with and to compete.
I think that we have to have some sort of European government because they have. It is not to say that the proposed EU Constitution is the best one. It could be much better in lots of places - see blog of Stephan Okhuijsen.

Pieter Cleppe said...

The example of Hong Kong is in any case a historical example. Hopefully it lasts. After world war II, Hong Kong was, in the history of the world, probably the place with the highest degree of freedom ever. The government consisted of British bureaucrats and functionned as a company. Now Hong Kong is in the top 5 of financial centers in the world, not to speak about all the culture it created (e.g. cinema).

Due to global competition, the opportunity cost of non-decentralising will increase more and more, as well in Europe as in China. And if the Chinese central authority weakens, it won't be able to reduce the indepence of Hong Kong and Taiwan. Then also the argument that we need central defence because they have a well-funded central defence doesn't make sense any more.

Gawain Towler said...

Thoughthe French No will be very important, I believe that the Dutch one will be more significant. Both are founder members ofthe club, but, Holland has always been a true believer while France has always been awkward. The officials here in Brussels could brush off a French 'No', with a smile and a comment about Gallic character. A Dutch No will be a body blow to their collective psyche.
I shall be sitting on Rond Point Schuman watching them crawl into work in the morning, with the spiritual stuffing knocked out of them.

Pieter Cleppe said...

True. The European project is coming under fire, due to this referendums. I haven´t yet mentionned the possibility that at the end, if the top politicians really go through with the constitution, and the British really don´t want to proceed with it, maybe the British leave the Union. Which would be a great precedent.