What if it all goes well?

“To go well” is, of course, subjective. It is even more subjective when we are talking about European integration, with its entanglement of questions and trends and a group of actors whose interests are often distinct.
But, in this time of pessimism, it appears to me that it can be interesting to reflect about a positive scenario of equilibrium in the future course of the integration process. A scenario in which the train of integration does not suddenly brake.
Lets then imagine a group of possible evolutions for the positions of four of the key EU actors in the next decade:
Throughout the next decade, France would accept the gradual reduction of the Common Agricultural Policy’s (CAP) weight on the communitarian budget, at the same time it started a process of structural internal reforms which, while transforming the French capitalist system, would bring about good results in terms of economic growth. At the international level, French leaders would clearly understand the disadvantages of a permanent attempt of international affirmation in opposition to the USA, which would allow for the construction of a strong bond between the two powers (for example at the level of defence), empowering the dynamism of the European defence industry and of the progressive affirmation of an effective European identity of defence within NATO. This would be a France with a new generation of politicians in power (perhaps Sarkozy, perhaps Villepin), without Chirac or Jospin and very hardly with Fabius.
Germany, in spite of the economic difficulties and of initial internal costs of the structural reforms (successful in the medium term), would accept to continue to play its part as the biggest contributor (in liquid terms) towards the communitarian budget. On the other hand, already far away from the scars of the Second World War, it would assume greater international prominence, which would be reflected upon, among other things, membership into the United Nations Security Council. These evolutions could happen with a central block government in Germany led by Merkel or by CDU / Free Democrats coalitions (with or without the Greens) or SPD with the Greens.
An EU that would be closer to the USA (more of a partner, less of a rival) would lead to a greater popularity of the EU in the United Kingdom. This improvement of EU’s image would have as is most remarkable facts the gradual reduction of the “British rebate” and, especially, the United Kingdom’s support for the “Economic and Monetary Union”. The natural successor of Blair (Gordon Brown) seems to be the suitable person make these evolutions possible, which would presuppose the continuation of the prolonged absence from power of the Conservative Party.
Lastly, the Netherlands, fearful of migration pressures but confident of an EU which managed to persuade the UK to adhere to the euro and which accepted the reduction of the Dutch liquid contribution towards the communitarian budget, would participate in the consolidation process of a collection of Europeans policies in regards to Internal and Justice Affairs (IJA). These policies would prove quite a lot more efficient than in the past, when it comes to, for example, immigration control (leaving, however, some room for maneuver by the member states). This Dutch evolution would implicate that populists would be keeping away from power and, probably, that the Liberals would have a key-role in the government’s coalitions.

Are we attentive?

Although more evident nowadays, the Portuguese difficulties in the world economy are not from now. If we look at the 1990s (not to go any further) we will acknowledge that the need to alter the productive profile (and essentially the exporter profile) of Portugal (even then) was blatant. Even then Eastern European countries were affirming themselves as contestants whether in traditional sectors, intensive in labour and little demanding in qualifications (ex: clothing and footwear) or in sectors more scale and knowledge-based (ex: electronics and car industry). Even then these countries (Czech Republic, Poland, Slovenia, Slovakia, Hungary, Bulgaria, Romania) paid particular attention to Foreign Direct Investment (FDI) as a fundamental vehicle for growth, better productivity and for a structural transformation of the economy. Even then China was positioning itself as a great contestant not only in the previously referred traditional sectors but also in more knowledge-based activities (ex: electronics). Nowadays, it presents itself as a giant in almost all the activity sectors, from those based on cheap labour to those based on scale and technology. Even in the high technology, China has been giving clear signs of being an actor to be taken into count. Even then India affirmed itself as a great exporter not only in traditional sectors but also in services (of different technological levels, from call centres to the high technology services as the development of computer applications). Even then, the Spanish regions showed great dynamism in activities competing with those developed in Portugal and aligned themselves with the international movements of the FDI.
It is not enough to do better and more creatively than Portugal did traditionally. It is also essential to do new things, to attract and conceive new activities that create value, of greater productivity and more tuned in with the variations of international commerce. There is a new technologic wave emerging – with effects at the levels of investment and international commerce. Are we attentive?

Give it a decent funeral

On the aftermath of the French and Dutch “no” to the Constitutional Treaty of European Union, the 25 heads of State met in Brussels, on that occasion the European Council declared:
“The citizens express worries and reservations that should be taking into consideration. It is, therefore, necessary to proceed with a due reflection about this happening. This reflection period would be used to carry out in each of our countries a wide debate, with which citizens, civil society, social partners and national parliaments will be associated, as well as political parties. (…) We made an appointment for the first semester of 2006 in order to proceed with a global appreciation of the national debates…”

A wide debate? To which citizens, civil society, social partners and political parties will be associated? Political parties? One almost feels like say nothing deserves to be said such is the shallowness of the words. The debate does not exist, it is not promoted, it does not have interest neither from potential promoters nor from potential participants. The Portuguese Prime Minister signed an empty, subjective and discouraging declaration of intentions, in which the small print seems to affirm in a loud voice: “the Constitutional Treaty died, it is buried and is irrecoverable. We are only going to try and recover some parts to see if we get along together at 25. Also because the current treaty, the treaty of Nice only triggered debate for a single reason: the need for its revision.”

The fact is that the Constitutional Treaty really did die, and the later the burial, the more commotion it will cause. The Constitutional Treaty only could come alive if all the Members States of the European Union had ratified it. France said “no”. The Netherlands said “no”. Czech Republic postponed the referendum that was supposed to be in June 2006. Denmark postponed the referendum supposed to be on the 27th September. Ireland also delayed the referendum, just as Portugal did. The United Kingdom delayed the referendum and the parliamentary ratification. And Sweden delayed the latter.
The Constitutional Treaty will not come into practice. Perhaps it will be possible to make the most out of some less polemic novelties, namely on what concerns the simplification of treaties and the transparency of the European Union. Just give it a decent funeral. As quickly as possible.

“The idea of there not being anyone in this country is unbearable: I have to run for elections”

In 1985, the Socialist Party candidate to the next presidential elections unabatedly signed the Treaty for Portugal’s entry into the European Union. This was the first political act in Portugal that I accompanied with enthusiasm. It was a victory for Portugal and it definitely put us in the route to Europe and to development. In 1986, the candidate from the left on the next presidential elections was elected, for the first time, PR. These were the first elections in my memory, where I supported, in an active and emotional way, Mário Soares. In 1991, Mário Soares was overwhelming re-elected PR (even then, the phenomenon of the “void” already showed some signs). Possible future PR, probable future PR, Socialist Party candidate to the next presidential elections, candidate of the left to the next presidential elections, Mário Soares. I apologize for repeating myself, but I do not get tired of repeating it, since they tell me that it is true, I read it on the newspapers, but I still cannot believe it. As I write this article, Wednesday, the 31st August, early morning, I still have a small hope that he will back down at the last moment (but, deep down I know it is not going to happen). The candidacy of Mário Soares, a unique man in the Portuguese history of the second half of the 21st century, represents the complete failure in the renovation of the political system, a kind of generational politic scleroses (with its origins in Mário Soares’ generation but also, although to a smaller extent, in Cavaco’s one) that halted the renovation, settling in its own failure (of being able to put together parties and bring about capable politic leaders) the reason of its maintenance in power. “There is no one else, I have to advance”, must have thought Mário Soares when he decided to decide to be a candidate for candidate. It is this “no one” that worries me. Is it, as it seems, that there really is not anyone else in the Portuguese left (the right is not much better) capable of presenting himself as a strong candidate to PR in the beginning of the XXI century? And is it the case that, because there is no one else, exactly one of those responsible for this void is going to be elected, taking into account the long-term exercise of party power by Mário Soares. Honestly, the next presidential elections deserved the occurrence of surprises. To the left and to the right. Somebody that would challenge this “back-and-forth” of “addicts” to power and history. That would halt the paradox in the genesis of this process that may not be more than an intimate dialog of the kind: “the idea of the Socialist Party, my Socialist Party, giving its support to a comrade more dedicated to Arts than to electoral victories is unbearable; the idea of the Socialist Party, my Socialist Party, supporting Freitas do Amaral is even more unbearable; the idea of not being anyone in this country is unbearable: I have to run for elections ”

Money: Wanted

In the European Union (EU), with the terrorist tension in turmoil, the difficulties in economic growth and the sensitivity of the questions related to immigration and border control increasing, the concept of Independent State has gained terrain to the idea of Member State ( “Member-State”, and therefore, co-responsible for group decisions and for the success of their implementation). Only this explains all the tension about the EU’s budget, that is, about 1% of EU’s product (a national budget is usually situated between 45 and 50%of the national product). With the reinforcement of the importance of nationality and the difficulties in growth and in job creation, the “old buddies” have started counting each euro. Looking at the “old” 15 (not counting with Luxembourg), I will briefly refer to a basic difference that, among others, structures the relationship between States in the EU: there are those that pay and those that receive, that is, some Members States are net contributors for the EU’s budget, while others benefit from the referred budget.

When they seat at the negotiation table, the difference between those who contribute for the thin budget of the EU and those who benefit from it over and over again is clear. If I give the money to someone, I can demand some conditions. If I receive the money, I can, in as much, be a “good student” (I can also be a “bad student” here and there as long as such behaviour does not turn into a rule on the eyes of those who pay me, running the risk of having my nice sponsor simply stopping the payments). It is because of this (but not only) that only the more uninformed thought that Germany could be fined for having a deficit of about 4% of the product. It will be enough, through the German perspective, having offered its national currency to be ran together with those gentlemen and ladies of the south Europe that deserve little trust and to having been, since always, (and by far) the biggest net contributor (in absolute values) to the communitarian budget. “Enough! The Second World War ended 50 years ago and we (Germans) have enough problems with our economy and our development model.” On the other side of the barricade we have “nuestros hermanos” who want to be big, to be in all the photos and to always have a word while, simultaneously, also wanting to continue to receive funds, because they are still poor, and cannot just suddenly enrich, in a purely statistical way. It is a schizophrenia that limits, for now, Spanish ambitions (in the EU; not in Portugal).

So, who is giving out the money, wanting to control its destiny? From Germany, the United Kingdom, France (not much, in relative terms), Netherlands (a lot, too much, taking into account its dimension), Sweden, Denmark and Italy (little). And for whom does the money go to, not wanting to irritate their financiers? It used to go to Ireland (that went from a “country of cohesion” to the second richest country of the EU in terms of per capita product – just after Luxembourg), it goes to Spain (the main beneficiary in absolute terms), to Greece (theold poorest member of the old poor members of the Union) and, of course, to Portugal (you guessed it: the current poorest member of the old poor countries of the Union; poorer than the two richest of the ten relatively poor countries in terms of the EU average that entered the club on the 1st May of 2004: Cyprus and Slovenia; and very soon poorer than two others: Malta and the Czech Republic).

Good Luck

Blair has an extraordinary task in hands: to quickly convince continentals to radically alter the allocation of money in the process of European integration, dedicating it to vanguard areas; and to convince, in the short-term, his fellow countrymen that this Europe of innovation, without CAP, with a large and deepened Single Market, that is more demanding in the application of structural funds, is worth it, it is fundamental for this process of European transformation that the United Kingdom (UK) adheres to the Single Currency. It is for this Herculean task of Blair that many in Europe look at expectation (starting with Durão Barroso, who has been going through complicated times since he assumed the Presidency of the European Commission – supported by, rember, the UK). If it comes through, Blair’s Europe will be a very different Europe. With a coordinated Defence sector but without aprioristic ambitions of counter-power against the USA. With the euro and a Single Market even more developed. With a big role for the Members-States (MS) and great caution towards advances considered as federalist (with that point, France will keep agreeing to). It will be a Europe that will reform its social-economic model that is so pressured by demography and global competition. And It will also be a more demanding Europe on what concerns security and, possibly, more attentive and selective in relation to immigration. It will be less cohesive and more competitive. With less funds of cohesion but with renewed opportunities for the most dynamic MS (and more risks for those who are incapable of reforming themselves and compete). If he achieves it, Blair will be making History. If he obtains an agreement in the Financial Perspectives, reforming the CAP and the English rebate and if, afterwards, he brings the UK closer to the European Union and to the Euro, Blair will be justly referenced in future historical pages relative to the beginnings of the XXI century of the “Old Continent”. Good Luck.

“Demain ne sera pas comme hier, il sera nouveau et dépendra de nous”[1]

Local elections are nearing. It is a moment for speeches and promises. For inaugurations and (particularly) wide political smiles. Time for new demands (and for the renewal of old ones), for stickers, electrical appliances (was it true?) and little flags. A time very often for a dangerous discrediting of the political system. In a context of deep changes in the role of local government (in which they can affirm themselves or not as promoters of development) and of great budget limitations, it is more and more important to define, together with the population and other actors of regional development, the priorities of public local action. What does the population want from its councillors? How to adjust public spheres to a world in transformation, allowing the Administration to be at the same time creative and renown? What is our collective project? What mobilizes us? These are some of the questions I would like to, at least see being considered and debated during the next electoral campaign. To decide about my vote, I am going to look for ideas and projects for the region. Someone who throws challenges to the population and to the actors of development. Who understands the importance of the economy and growing competition (increasingly also between local councils) in the caption and maintenance of knowledge, talents and investments. Someone who associates strategy and actors, public and private, cooperative and entrepreneurial. That says what he want to do and with whom he wants to do it with. That promotes the participation of actors, committing them and hold them co-responsible for the future. That understands that the collective intelligence of a region is far from just concerning the public sector. And that from that perception draws conclusions. Someone who, basically, believes, in permanence without hesitations that “tomorrow will not be as yesterday, it will be new and will depend on us”.

[1] Extract of “Phénoménologie du temps et prospective” (Gaston Berger, 1964).

NON

The French have said “no” to the European Constitutional Treaty (CT). And, at the same time, it seems they have said “no” to everything except to the CT’s text.
They said “no” to the French government and to Chirac (“Non à la Constitution, au government, à Chirac”, was one of the slogans used by the defenders of “no”), to the growing unemployment, to the enlargements of the European Union (EU) that limit the French privileges and to market liberalization. But it does not seem like they have actually said “no” to the CT’s text. This is so because, in spite of the CT being more than a mere compilation of the previous Treatises (the form in which it is being presented by labour in the United Kingdom), it is not, most definetely, responsible by the amalgam of French refusals. The CT collects the Treaties, making them more legible (in spite of the text still being very extensive and detailed) and brings about some novelties relatively to Nice (the reigning Treaty), but not as much as it may seem (nothing compared to the Treaty of Maastricht, for example). And, above all, it does not seem to be to those novelties that the French said “no”. Have they said “no” to the inclusion in the CT of the Fundamental Rights Charter? Have they said “no” to the new counting of votes in the Council (less polemic than the one it pretends to substitute, that is, the one agreed to in Nice)? Have they said “no” to the little novelties in terms of the exclusive competences of the EU and to the greater use of qualified majority voting? Have they said “no” to the clarification of competences delimitation between EU and the Members-States (SM)?
Have they said “no” to the possibility of a structured permanent cooperation between some MS concerning a Common Security and Defence Policy? Have they said “no” to the definition of relationship mechanisms between the EU and the MS that wish to abandon it? Have they said “no” to the new office of a Foreign Minister of the EU? Or to the new office of President of the European Council? Have they said “no” to the end of the 3 pillar structure and to the assumption of the EU as an entity which has its own juridical personality? I do not think so.But, then, if the French did not say no to the CT’s novelties, what did they say no to? In my perspective, unfortunately, the French said “no” to what the CT symbolizes, that is, to the continuation, at least in the current settings, of the process of European integration. And it is here that a very serious problem arises. Everyone seems to say that the French “no” represents the need to change the integration process in Europe (without understanding, in very concrete terms, what it si that it actually means: more protectionism? More subsidies? More taxes? Less enlargements’? More influence of the “big”? But influence of the “big” when it comes to the economy, the military, demography? Or to the importance they systematically attribute to themselves?). And very few seem to say something that seems obvious to me: the European integration process is an open movement (on what concerns the participation of states), reformist and demanding. If the French legally refuse it, it does not mean the European refuse it. If the French (understandably but unfortunately) refuse a European integration process that has always benefit them (look at the Common Agricultural Policy and the Single Currency, for example) but tends to benefit them less in the future, that does not means that the Europeans do not want it. The problem of the French “no” is french and european. But it remains more French than European. Europe does not have to change to satisfy the French. Europe has to evolve to correspond to the expectations of europeans. And if the Europeans are interested in trailing routes that the French do not accept, then the EU will have to confront the French with their options. If it does not do that, it will always be under threat of French veto and judgement.
Europe is not France. And this is the fundamental moment to make it clear. Mesdames et Messieurs, les portes sont toujours ouvertes.

Who is going to pay the interest?

Everyone seems happy with the Stability and Growth Pact (SGP) agreed by the Finance Ministers of the European Union (EU). It is, in fact, a reason to smile. It is as if, at the end of the year, we would put together in an Assembly all the people who were fined this year and had as the only point in the agenda: “to forgive or not to forgive the traffic fines”. It is not difficult to guess the decision… “It would be handy” for almost every Government to change the SGP. And so it was changed. And everybody was a happy chap. Everybody? No, some irresolute and strange economists still say that the stability of European public finances is not only a question that is very sensitive to political interests (not all of them are so “noble” as our technologic shock; believe it or not, there are those who expect to win elections more easily with this renewed ability to easily spend/invest…) but also, above all, it is a fundamental basis for economic growth. The message that came across about the SGP (“we created it but, after all, it is too rigid for the expenses/investments we want/have the need to do, so we have to make it more flexible”) increases the pressure on the interest rates in the euro zone (towards its increase, of course), making the commitment of sanitizing the public accounts of the Member-States less incisive and giving a bigger room for the public induction of the rise in prices. This inflationist pressure will be fought by the European Central Bank (ECB) with the rise of the interest rates. And when, in one of the next meetings, the ECB raises reference interests rates, the many Portuguese who bought, with great effort, their own houses, has to send the “bill” to the men and ladies of the Left Block and the Communist Party (for example) that so much attacked the ignoble monster called SGP. Fact remains that the fashion was, almost from the start, to attack the SGP, to blame it for the weak economic performance and the increase in unemployment, among other bad things. No one (or very few) said what it was actually for. Now, unfortunately, it is going to be understood. And the Portuguese with house loans will be some of the first.