Library of Economics and Liberty masthead logo 
Anthony de Jasay

The Future of Europe: A Giant Free Trade Area or a Political Counterweight to America?

Anthony de Jasay*

Nearly half a century ago, with the signing of the Treaty of Rome in March 1957, what is now the European Union (EU) started out as the European Economic Community (EEC) with six member states (France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg). The unanimous aim of the founders, held at the both the grassroots level as well as among the political elite, was that a future Franco-German war must never again happen. In the years immediately after the end of the Second World War the approach was gradual, confined to what were regarded, somewhat naively, as the industries which were thought to be the instigators of wars. Thus the European Coal and Steel Community was founded 1951 by the same six nations which were later to form the EEC. In 1954 a bold attempt was made by the political elites to create a European Defence Community but this ran aground on nationalistic shoals. Advances continued to be made with the formation of the Common Market or EEC in 1957, the purpose of which was to create free trade inside its members' frontiers but which would be protectionist toward the outside world. Above all, as the price exacted by France for opening its own market to German industry, the EEC saddled itself with the economic monstrosity of the Common Agricultural Policy whose most wasteful outgrowths are only now beginning to be trimmed.

The original six-nation EEC could not, in the longer run, shut out the rest of Europe and call itself European at the same time. Several countries were strongly pressing for admission. After de Gaulle's veto of British membership in the EEC, the European Free Trade Association (EFTA) was formed in 1960 by 7 nations which had been refused membership in the EEC—the United Kingdom, Denmark, Norway, Sweden, Austria, Switzerland, and Portugal. The EFTA differed from the EEC most notably in the absence in the former of any broader aspirations for political union, which created tensions with the more politically-driven EEC. The federalists [Editor's note: Jasay means by this term "political centralists" not "federalists" in the American sense of the word.] inside the EEC resented that the outsiders in the EFTA were getting all the benefits of free trade without shouldering the task of building a politically united Europe. Indeed there was a loudly voiced suspicion that some of them, notably the British, were doing their best to sabotage political unity. The upshot was that little by little all the EFTA members bar two entered the EEC. A Northern tier came in with Britain, Denmark, Finland, Ireland, and Sweden and a Southern one with Austria, Greece, Portugal, and Spain. The southern members and Ireland reaped huge benefits from the so-called "structural funds" which the EEC siphoned off from its richer members and distributed to the poorer regions to help them catch up with the European average. The richer members, in addition, had to put on the hair shirt of the Common Agricultural Policy. Margaret Thatcher, wholly unimpressed by Mr. Giscard d'Estaing's browbeating, secured for Britain a balance where the payments Britain made to the EEC nearly matched the benefits it received from Brussels. Germany and the Netherlands ended up as the main paymasters of the EEC budget, and every other country became a net gainer to a greater (Greece, Ireland, Spain) or lesser extent. With occasional crises and much friction, the new 15-member European Union has become an established concern, pushed along by the Franco-German alliance.

Then came the break up of the Soviet bloc in 1989. All the former satellites asked to be admitted to the EU. Their political elites were motivated by the prospect of the structural funds and the charms of rubbing shoulders in the same club with the leaders of the richer Europe. At the grassroots, there was an innocent belief that what Russia could once do with impunity to a Poland, a Czechoslovakia or a Hungary, it could never again do to a member of the EU. There was much quiet but bitter opposition among the federalists in France and Germany to the admission of 10 new members on the grounds that many of them are in fact Trojan horses harbouring Anglo-American ideals and purposes. Nevertheless, it was unthinkable to exclude what were practically founder members of the historic Europe, victims of Yalta and of Western connivance in shameless Russian oppression. So seven ex-satellites and Slovenia were admitted in 2004, and southern Cyprus and Malta were slipped in for good measure as well. Rumania and Bulgaria were virtually promised admission in 2007—in large part because none of the lead nations of the EU felt like turning the Rumanians and the Bulgarians into bitter enemies for opposing their membership, and driving them into the arms of rival EU nations. Thus, as of 2007, there is to be a 27-member EU speaking 23 languages, with some federalists still hoping to turn it into a homogenous, socialist-oriented political entity, while others now believe that this has become a lost cause.

The EU is now committed to start negotiating full membership for Turkey in October 2005. Though virtually assured of an accord, the talks are planned to drag on for 10 to 15 years with the unspoken aim of giving hostile French and German public opinion time to get accustomed to the idea. Turkey, with over 70 million inhabitants compared to the present EU's 450 million, will be the latter's most populous member by about 2020. Because of the proposed constitutional treaty introducing weighted majority decision-making, it will be the EU's politically most influential state. However, it will also be its poorest member by far. Under present rules, it should be receiving agricultural and regional subventions of 30 billion euros, or 20 per cent of the total EU budget. By the time Turkish membership is realised, these rules will no doubt be changed, but the economic benefit to the EU is still dubious. Free trade is in the mutual interest of the EU and Turkey, and is a largely accomplished fact. All other aspects of membership are in Turkey's interest alone. Turkey's professional classes and its army in particular expect that EU membership will prevent the country from sliding into Islamic excesses.

Throughout the EU the debate is raging about the wisdom of admitting Turkey to the club, even though the lead governments have already made up their minds and, in the case of Germany and France, are ruthlessly overriding public opinion. The main popular argument for Turkey is that if, after decades as an applicant, it were now turned down, the Moslem world would take the refusal as proof that the EU was a Christian cabal and a successor of the Crusaders. This in turn would lead straight to the "clash of cultures" and the "war of civilisations" touted by pop historians and sociologists. It seems to be forgotten that the Turks occupied all the Arab lands from Baghdad and Cairo to Marrakesh from the 15th century onward, and in the case of Iraq, Syria and Jordan, down to 1918. Little love is lost between Turks and Arabs because of old wounds and because the former are regarded as allies of Israel.

The German government is championing Turkish membership with an eye to its own 2.5 million strong Turkish immigrant population and the votes of its second-generation citizens. The determination of the French government to support Turkey, despite the polls that show 65-68 per cent of French people are opposed to its membership, looks very strange. Its hidden mainspring is the craving to make the EU into a political, economic and military superpower under undisputed French leadership, enabling France to stand up to America as an equal and a counterweight to US "hegemony". Ever since the 1950s, this design never came anywhere near fruition, causing mounting frustration in Paris. Turkey has a standing army greater than any two of the largest national armies of the EU taken together. Bizarre as the idea may be in reality, the thought of half a million ferocious Turkish soldiers being added to the puny European forces seems to be too tempting to resist.

There is little doubt that hopes of enlisting the Turkish military to serve French design and will be disappointed, as were similar hopes in the past. The addition of Turkey will make Europe even more like a free trade area and even less of a political counterweight.

After Turkey, it will be Ukraine's turn. After the courage its people have shown in wresting electoral victory from the pro-Russian forces late last year, its entry with another 50 million people into the EU is an odds-on certainty, and the dream of a homogenous and united EU capable and willing to act as one force is receding into some very distant future.

After Ukraine, whose turn will it be? A new doctrine is arising in educated opinion, which holds that it is not geography that qualifies a state for EU membership, but "shared values". On the strength of this doctrine, Europe is in for limitless expansion across North Africa, Central Asia and the Middle East, because if Turks share European values, who does not share them? An ever-expanding Europe straddling three continents would be politically impotent and probably quite harmless. Economically, it would be a good thing, for the larger a free trade area is, the more good it can do by trade creation and the less harm by trade diversion.


*Anthony de Jasay is an Anglo-Hungarian economist living in France. He is the author, a.o., of The State (Oxford, 1985), Social Contract, Free Ride (Oxford 1989) and Against Politics (London,1997). His latest book, Justice and Its Surroundings, was published by Liberty Fund in the summer of 2002.

The State is also available online on this website.

For more articles by Anthony de Jasay, see the Archive.
Return to top
Copyright ©2008
Liberty Fund, Inc.
All Rights Reserved