Year XXXVII, Number 3, November 2024

Jean-François Drevet
Former civil servant in the European Commission, specialist in regional development issues 

Chapter 3. Towards a Federalist Shift?

Possible Solutions

As long as it was only a matter of exercising economic competences, the EU could move forward through compromises, for which we were all the time in need, but which are no longer possible today. When it comes to security, we need to be able to act quickly and more effectively.

The qualitative leap demanded in recent years has become an emergency^[i]. The history of federalism tells us that it is often under such circumstances that it has been decided to move forward: as said above, no one became a Federalist by conviction, but because it was, at some point, the only possible solution. The EU could soon become confronted with this need^[ii].

Since the negotiations of the Maastricht Treaty, European governments have tried to find answers to these problems by changing the institutional framework, without achieving results commensurate with expectations. Should we resume the process of integration within the framework of monetary union by setting up a “political community of the euro”, deliberately and explicitly federalist. Another option would be to achieve federalism without saying it, as has been implicitly the case since the implementation of the European single market, for example by using the grey areas that the European institutions can de facto use, as the ECB did in the euro crisis.

In this way, the banking union^[iii] could be consolidated, going beyond what was done by strengthening shock resistance through the establishment of a centralised deposit insurance system. The tax reform, currently blocked by unanimity rule, is increasingly necessary in order to address new European responsibilities, such as Defense and Environment.  As major beneficiaries of the Single market, economic agents should contribute to the European budget, for instance through an additional corporate tax.

Externally, “the burden of European security is not equitably distributed^[iv]”. It is necessary to clarify the conditions for an increased engagement of the European armies. At the very least, it is a question of respecting and enforcing economic sanctions already decided and of carrying out coherent diplomatic actions, which means going beyond the “coalition logics” dictated by the circumstances, which governed the previous operations.

As regards internal security, the threat of terrorism and the factors that produce it have not diminished. As François Hollande pointed out^[v], “it doesn’t take less Europe, it does take more Europe to fight terrorism”. If the EU does not want a Patriot act, it is expected that effective initiatives will result from this diagnosis. Is it necessary, as has often been said, to have a European FBI, or can we live with a system of structured cooperation? For many, a supranational authority is clearly necessary.

Public opinion is not fundamentally hostile to a qualitative leap. Despite the economic difficulties and hardships that the EU has imposed on some countries, Eurobarometers regularly point to strong majorities in favour of maintaining the euro^[vi] and of strengthening the European foreign and defence policy. When it comes to internal security, citizens want effective measures, not only in countries recently hit by terrorism. Even if they sometimes have confusing electoral attitudes, people can also be more lucid than their leaders.

Finally, the role of exogenous factors remains to be assessed. Throughout history, the rise of external perils has often been a stimulus to cohesion. Best NATO recruitment sergeant as he is, will Vladimir Putin become an architect of European integration, pushing the EU towards more integration? If Europe needs enemies to awaken its sleepwalkers of the 21^st century he is indeed the best candidate. Similarly, unlike those who celebrated it loudly, Brexit does not seem to have harmed European integration.

Since the great clash between Girondins and Montagnards and the repression of a “federalist insurrection”, which had raised 60 out of 84 departments against the Convention^[vii], the latter got no good press in France. Though Federalists are no longer liable to the guillotine,^[viii] the concept and its institutional reality remain poorly known and sometimes decried.

Nevertheless, since the proliferation of crises, from Covid to war in Ukraine, the prospect of the transformation of the EU into a federal structure is regularly discussed. Those who advocate it recommend a qualitative leap forward that would remedy the complexity and ‘democratic deficit of the current institutions. Those who fear a move towards an Orwellian “super-state” that would definitely put nation states and their democracies under tutelage have lost British support, but remain quite numerous, especially in the Nordic countries. In Poland and Hungary, recently inclined to develop their version of Euroscepticism, would fear of the Russian bear be the beginning of wisdom?

Today, the time for “the state must do everything” is over. We have seen this with the devolution, which has led, in the name of democracy and subsidiarity, to give local authorities the powers and sometimes the means to better serve the citizen. The same applies to the supranational level of our house of governance where the shared sovereignty must be democratically managed, instead of being subject to opaque political bargaining.  

At European level, only three Member States (Germany, Austria and Belgium) are federations, not counting Cyprus, which would become federalised in the event of reunification. The others implement different forms of decentralisation, but remained unitary states, in particular because some of them are small and even former members of a federation^[ix]. The current functioning of the Union is therefore dominated by relations between the national and Community levels. As a Union of States, the EU has given local and regional authorities only an advisory role (in the Committee of Regions), a few of them (in Belgium and Germany) have international competences.

• The supranational process

The overlapping of political constructions is nothing new in Europe. In the course of history, after the hegemonic competition of the pope and the emperor, we have witnessed above all processes of “top down” unification of the imperial type. This was often the result of conquests, of which the Ottoman Empire or that of the Romanovs offer good examples, also of inheritances or marriages, as with the Habsburgs, which brought together very different entities of the Danube basin^[x]. The bottom-up process is less frequent, but we have seen that the United States, Switzerland or Australia are the product of a unification dynamic that is analogous to that of Europe, having built a federal level above the constituent states, by a relatively consensual evolution, but dictated by necessities.

By increasing from 6 to 28 and then to 27 Member States (1958-2024), it even showed greater territorial dynamism than the United States (from 13 to 50 States from 1776 to 1960). But the same is not true of the transfer of competences. Building a federal state in those days took a long time, although implying scarce populations: the United States had 2.5 million inhabitants in 1788, as much as Switzerland in 1848. When Australia became federal in 1900, it had 3.75 million inhabitants and Germany from Bismarck had 40 million in 1871. There is no precedent for the voluntary creation of a supranational group with a population of more than 450 million souls. If today we had to grant the 330 million Americans in 50 states a federal organisation, a George Washington of the 21st century would face much more difficulty.

Though the Founding Fathers were in favour of a European federation, they knew, a few years after the end of two world wars, that this objective was not achievable in the medium term. They therefore used the small steps method, hoping that the solidity of economic links (the common market) and then monetary links (the euro) would create a dynamic. By a process of spill over which has not materialised, it was supposed to lead to a political union, which is indispensable to definitively stabilise a Europe which still has strong sovereigntist, if not overtly nationalistic parties.

This expectation is not without analogy with the German case, where the Zollverein (1834) that prepared the imperial unification of 1871 was also the result of wars won against neighbouring countries: Denmark (1864), Austria (1866) and France (1870-1871). Though Europe does not yet have a military capability, it already has high-ranking enemies, for example in Russia and Turkey. Instead of the ring of friends expected to develop through its neighbourhood policy, it is now surrounded by a ring of fire. Would war, or rather the need to defend oneself effectively, produce federalism?

As experience had shown the impotence of confederal structures, the creators of the ECSC and the Common Market invented the Community method. While retaining their sovereignty, the Member States were placed in an institutional framework strong enough to decide jointly and be bound by the outcome of their decisions: the Commission proposes and executes, the Parliament and the Council decide and the Court of Justice has the final say in the event of disagreement. This is not federalism, but it looks that way by the legal preeminence of European law which derives from international treaties. It is not yet democratic enough, but since the Treaty of Lisbon, the European Parliament has gained new powers that bring it closer to a full-function assembly.

The last three decades, while greatly increasing the competences of the European level, have reinforced the Council’s weight, thus the pre-eminence of intergovernmental cooperation over the Community method. The definition of new areas of intervention, managed by the Member States outside the Community framework, have shown the persistence, if not the renewal of a sovereignist vision in the functioning of European institutions, which is neither effective nor democratic.

As such, the record of the last decade is not very positive. Instead of having a role as a driving force on the whole, the Council was the scene of the affirmation of national egoism, where the general European interest is not defended. We saw it well with the chaotic management of the euro, then with the inability to adopt a migration policy, as well as the refusal to make a fiscal reform. The institutional system, designed for 6 Member States, which worked fairly well up to 12, has become clearly inadequate. But the reform missed in the 1990s-2000 is even more difficult to achieve today. The revision procedure, from an intergovernmental conference to referendums, is totally ineffective; ratifications may be suspended by a single Member State for reasons which have nothing to do with European issues.

The disadvantages of such complexity are obvious. The recently revised study on the cost of non-Europe^[xi] estimates losses related to the inability to cope with the latest financial crisis at several hundred billion euros. Conversely, the benefits of the banking union would amount to 0.3 to 0.8 % of GDP. In terms of security and defence, in comparison with the United States, the study believes that a common defence policy would be much more effective at a lower budgetary cost. Unfortunately, the benefits of an integrated Europe on these issues have not been assessed, in particular in better management of increasing threats coming from the periphery of the continent. Peacekeeping seems costly only before a conflict, and the war in Ukraine has answered that question.

In the euphoria of the 2000s, Europe thought that its soft power would suffice to develop cooperation with its neighbours and share its values, while allowing its Member States to adhere more or less enthusiastically to the convolutions of Washington’s foreign policy: warmonger with Bush, abstentionist with Obama, chaotic with Trump. A decade later, the EU faces the consequences of its naivety and followership: in the absence of appropriate responses to the aggressive behaviour of Moscow and Ankara, the continent’s security has greatly diminished.

• The need for “A Europe that protects”

Since there is a political will to create a Europe that protects, it is essential to overcome its impotence by setting up a more efficient organisation, which implies developing more shared sovereignty^[xii] in policies deemed to be “regalian”. Obviously, the aim is to increase security, both internal (against terrorism), and external (through peacekeeping), policies: even economic and monetary ones should be developed.

As the intergovernmental management of these problems has shown its limits, there is no other choice, but to implement genuine common policies through a supranational decision-making structure, as has been done with the single market. If we want this level to be as democratic as the others, we need to transform our institutions to have a full-functioning parliament and an executive accountable to it.

In May 1918, faced with an imminent rupture of the Western Front, Allied governments decided, after more than three years of war, to entrust the single command of the armies to General Foch. No calculation has ever been made of the number of deaths that would have been avoided, had this decision been made earlier, and of how many lives were saved in the final weeks of the war.

Today, the dilemma is not the same, but it looks like it. We can treat it without talking about federalism, as Monsieur Jourdain did for prose. But this is what it’s all about.

[i] Roger Gaudino, Fabien Verdier, Towards the European Federation, Europe of the Last Chance, policy paper Notre Europe, 11 February 2014, 20p.

[ii] According to Bernard Guetta, MEP, in his book, The European Nation, How Trump, Putin and COVID Transformed the Union, Flammarion Editions, Paris 2023, 

[iii] “ euro banks were European in life but national in death.” (Mervyn King, Governor of the Bank of England).

[iv] Statement by Jean-Yves Le Drian, then French Minister of Defence on February 19, 2015 in Riga.

[v] In a speech of 23 February 2015, cited in Le Monde of 25 February 2015.

[vi] 2/3 of the inhabitants of the euro area are in favour of maintaining the single currency. Even the Greeks want to stay in the eurozone.

[vii] French Federalists at the time were against centralisation and in favour of local empowerment.

[viii] 10 % of the 13800 people executed during the revolutionary period.

[ix] This is the case of Slovakia, Slovenia, Croatia and the Baltic States which belonged to the late federations of Czechoslovakia, Yugoslavia and the USSR.

[x] “ Bella gerant allii, tu felix Austria nube!” (let others wage war, thou, happy Austria, marry).

[xi] Assessing the Cost of Non-Europe 2014-2019, European Added Value Unit, Directorate-General for Parliamentary Research Services, European Parliament, Brussels, April 2015, 95p.

[xii] Emmanuel Macron at the Ambassadors’ Conference, Le Monde 31^st August 2017.