August 28, 2012
In May of 2011 Wilfried Martens, President of the European Peoples Party and the Centre for European Studies, opened a CES Conference in London. He was asked about the future for European integration. He quoted George Herbert to the effect that “Storms make oaks take deeper roots”. I admired the elegance of the response, but then realised, that, for the first time in my adult life, I no longer believed with absolute certainty in the permanence of the European Institutions which had been created since 1948. A year of turbulence later, I conclude that the Euro, and therefore the European Union as we have it, will survive. While there will be many more anxious days for those in Brussels, I believe that the really acute problems will be faced by the British who are facing a long delayed moment of truth in their relations with the rest of Europe.
The trends of recent months persuade me that there is a continuing commitment to maintain the integrity of European unification in ‘Carolingian’ Europe – Germany, France, the Benelux and Italy, to which I would add Spain. I believe that the Germans will recognise the economic advantages that flow to them from the Eurozone. They will therefore accept that an investment of German money is worthwhile as it can generate both deeper political union and tighter economic supervision. Of course there will be an ongoing debate about the balance between growth and austerity, but this will be seen as a natural discussion rather than as something threatening the existence of the Union. There will be more European Summits, both formal and informal, between now and the German Federal Elections, but they will be seen as part of the normal processes of the Union, rather than as panicked exercises in re-nationalised politics. It is possible that there will be a Greek departure from the Euro in the coming years, but it will be buffered and will not have its current potential to upset the whole applecart.
Two linked trends have undermined the nerve of the European political classes – the potential collapse of the global economy and the growth of extremist parties. Just as it is only in recent months that we have come to realise how close the global banking system came to meltdown in 2008, so historians will note how close we came in this last winter to succumbing to multiple crises for which we were not prepared. To put it at its simplest, most nation states had emergency procedures for floods, nuclear meltdown or banking crises, but few had made preparations for a perfect storm where multiple factors struck at once. This is typical of the lack of resilience in complex societies. It might have proved fatal. Hopefully we are past the chance of such a disaster caused by lack of anticipation. What remains is the threatening realisation that growth may not return to the Atlantic economies in the foreseeable future. Indeed we may have to get used to the current situation of depression as normality. In the worst scenario such a gruesome reality could run right up to the 2020s when the nature of climate change constraints on growth will be apparent even to the most contrarian of observers.
Such a future would be richly encouraging to extremist political parties. Life has been difficult enough for governing parties in recent years, who have watched electorates turn against those in power, almost regardless of competence. The French example will not be the last. What is even more frightening for the political classes is that the whole political structure of a nation can go into meltdown ending the cosy alternation between traditional parties. In the Europe of today extremists come in many different garbs from the re-branding of the National Front in France, the eruption of the Golden Dawn in Greece or the flirting with ‘Putinism’ in parts of the Balkans. A disillusioned public is prepared to vote for a comedian in Italy or a populist in The Netherlands. It does not seem to matter to angry electorates what flavour of extremism is on offer as long as it can be used as a mechanism for punishing those in power.
At first sight the British would appear to be above such concerns. Their currency is not being pursued by teenage speculators and they have a functioning Coalition in place, secured by a fixed-term Parliament. One might therefore have expected a mature and constructive series of interventions from London. In fact nothing could be further from the truth. From the disastrously conducted Summit of 9th December 2011 onwards, the British have managed to marginalise themselves and alienate even their closest friends. In truth it is now dawning on the British that the outcome of Europe’s crisis is likely to be some very difficult choices for London. The key principal of British foreign policy is that ‘no Continental super-power should control the Belgian coast’. The threats from Louis XIV, Napoleon and Hitler having been seen off, but the British now face the possibility of a re-invigorated European Union, bent on closer political union, squatting on its doorstep. In the past this has been dealt with by a series of complex opt-outs. There is a slow recognition that it may no longer be possible to preserve British influence by such means in an organisation to which we are obviously not fully committed. This can be seen most clearly in the emerging nervousness in the City of London. Those with memories of the 1975 Referendum will recall how support from the City was essential for the pro-European cause; just as those in the City begin to remember that London’s global influence cannot be maintained if the UK is only a second class member of the European Union.
For some time now both the Prime Minister and Chancellor have been talking up the importance of a strengthened Euro. This of course is entirely in line with the logic which says that Sterling would not be taken into the Euro as long as there was the oft-described design fault of a currency union without a fiscal union. No one seems to have given thought to the impact on public opinion of a British Prime Minister enthusiastically endorsing steps to bring about a strengthened Euro. Such a habit of recommending a strong European integration, but one not including the United Kingdom, is reminiscent of Churchill’s approach sixty years ago. Churchill argued then that there was no need for Britain to join in European unification as we “were positioned at the intersection of three circles of power and influence” – the Empire, the English-speaking world and Europe. Sadly for those who would adopt such Churchillian tones today, the Empire is no more, the world speaks English, and the Americans are unlikely to welcome a weakening of British ties to Brussels as they “tilt towards Asia”.
David Cameron in December 2011 was engaged in an attempt to balance his Liberal Democrat allies against the Eurosceptic Right-wing MPs in his own Party. Such balancing is entirely understandable. His problem became more complex when the issue was related to his own political survival. Such is the antagonism of the Eurosceptic Right that the Prime Minister may well have formed the opinion that he would not long survive as Party Leader in a purely Conservative Administration. He will know that no Conservative administration in the last sixty years has increased its majority in a subsequent election. Once it became apparent that the Coalition’s work in overcoming the financial disaster left by Labour was not going to be completed by 2015, the necessity of a second Coalition with the Liberal Democrats became clear. On this basis David Cameron’s entire ten year time as Prime Minister could be spent in Coalition. Similar considerations apply to the room for manoeuvre available to George Osborne as his most natural successor. The most serious danger he faces would be a Eurosceptic attack on his leadership in 2014, just ahead of the renewal of the Coalition. It does not matter for these purposes whether the hand reaching for the “hollow crown” was that of Boris Johnson or Liam Fox. What the Prime Minister needed therefore in December 2011 was a public demonstration that he was prepared to take a Eurosceptic stance against Brussels, but preferably one which did no actual damage to Britain’s relationship with its Continental partners. Those who were present in the European Council in the early hours of the morning of 9th December maintain that he overplayed his hand. He set in stone the image of a bombastic, self-obsessed nation unwilling to play a European role at a time when it would have been most helpful. British influence has from that date reached a very low ebb, even amongst those who have traditionally looked to Britain for leadership.
How then is Britain likely to resolve the conundrum of its potential exclusion? In order to answer this question we need to consider the future of the current Coalition, its likely successor and the vexed issue of referenda. The Conservative-Liberal Democrat Coalition is working well by any usual measure and its impact on the future of British politics is becoming clear. The Liberal Democrats have acquired precious governing credibility. On the whole their ministers have performed well. They will be able to position themselves at the next election as a restraining force on the Conservative Party, or potentially on the Labour Party. Therefore they will not do as badly as anticipated by some at the General Election in 2015.
I do not believe that the current row over the reform of the House of Lords will break the Coalition. The planned reform was not just an easy target for back bench revolt in the Commons, by its nature it roused opposition from the current membership of the House of Lords, most of whom were to be summarily sidelined. My own solution would retain the current composition of the House of Lords, but elect four hundred ‘voting peers’ on the Regional list Proportional Representation system as currently used for electing British MEPs. This PEELs scheme (The Popular Election of Existing Lords, see Appendix I below) would preserve the expertise of the House of Lords, while endowing its votes with a greater degree of democratic legitimacy. A legitimacy however that clearly remained inferior to that of the House of Commons. The scheme looks much less radical now than it did in 1998, when I submitted it to the then Royal Commission on the Reform of the House of Lords. As it happens it meets most of the objections of Conservative back benchers and does not threaten the role of those currently active in the House of Lords. It could be introduced rapidly, with the first election taking place in June 2014.
I believe that Europe is the key to the future of the Coalition and that unless the current tendency to pander to the Eurosceptic Right is abandoned, the Liberal Democrats will be inevitably driven into future coalition with a Labour Party that has declined to commit political suicide by heading off to the Left. There is much talk of a threat from the UK Independence Party. It is being suggested that, having no serious competitors to their Right, after the implosion of the British National Party, they could benefit from being a ’safe’ form of extremism. Despite the talents of UKIP’s leader, Nigel Farage, I do not see that they are by themselves an election- determining force, let alone one capable of deciding the outcome of a post-election referendum. They cannot break through in Westminster first past the post elections. Boosting them now as a tactic to justify giving in to the Eurosceptic Right will only have the effect of making them more credible at the European Elections, when the electoral system is sympathetic to them. Although UKIP takes votes from all parties, it is a particular problem for the Conservatives because of the number of leading figures in the constituencies who make no secret of their willingness to vote UKIP in European Elections.
To find the key to referendum success we have to look more closely at the future intentions of the Murdoch Group, and particularly of the line likely to be taken by the Sun newspaper. The fascinating saga of the way in which the phone hacking scandal revealed the improper degree of influence which the Murdoch Group had established over both Labour and Conservative Governments has been largely interpreted in the context of winning UK General Elections. However the story is at least as significant in the story of how the Murdoch press led the anti-European charge which has pushed British opinion in a Eurosceptic direction. Such considerations might explain why Jeremy Hunt, MP, a convinced Eurosceptic since his student days, was so keen to see a takeover of BSkyB even if this meant the creation of a giant equivalent of Fox News with its declared biases. It is difficult to see how any referendum could be won without at least the neutrality of the Sun newspaper. It therefore becomes of prime importance who owns the Sun in 2017.
It is reported that all three Parties are contemplating offering post-election referenda. There are three possibilities – a vote following re-negotiation, a vote on the status quo or a vote on a fully-fledged membership for Britain.
The most unlikely one would be to approve re-negotiated terms for British membership. This is unlikely for the most simple of reasons. None of our Continental colleagues are keen to give the British yet more opt-outs at a time when we islanders are perceived as having been even more selfish and uncooperative than usual.
A more likely referendum could of course be to confirm British membership on the current basis, including our exclusion from the new aspects of European integration implied in fiscal and banking union. It is difficult to see how enthusiasm could be raised for such an uninspiring prospect. It would run the serious risk of the British leaving “by accident” as the result of misunderstandings and misconceptions.
This only leaves the option of a referendum on fully fledged membership. To restate the situation as it may exist by 2016. Europe will have gone ahead to fiscal and banking union with a declared intention of further steps towards political union. For those Britons who wish their country to remain as a serious player in European affairs, I would advise them to recall the English proverb, dating back to the seventeenth century, to the effect that “One might as well be hanged for a sheep as a lamb”. If we are to have an In/Out referendum, and to put to rest for ever the assertion that Britain only voted to stay in a customs union in the Referendum in 1975, then we might as well have a referendum that would lay the basis for Britain’s long term influence in Europe, including a commitment to join the euro and new aspects of Union policy by an agreed date.
Which party, or parties might be prepared to offer such a referendum on fully-fledged membership? The most obvious answer is that it would be the combination of Labour and Liberal Democrat, but this need not necessarily be the only option. Because of the distribution of current seats the Conservatives would be better placed than Labour to offer the Liberals a “coupon election” where the two parties agreed not to stand candidates against each other in certain seats. Such a move would be a natural continuation of the Coalition Government established in 2010 claiming an extension of its mandate as it had not yet finished its task of clearing away the debts of the Labour Government. Such a move need not be merely a short term expedient. The Coalition would come to dominate the centre of British politics and provide the base for a positive European policy. What is more it would be the only way in which the Conservative Party could align itself with the current attitudes of modern Britain, as elegantly summed up in the Opening Ceremony of the Olympic Games in London. No one can say how long the new consensus on Britain’s self-identity may last. As of this golden moment in August 2012 it would seem that the nation is confidently comfortable with a mixture of cooperation and competition, powered by a tradition of creativity. It is certainly true that the British have come a long way since the 1970s. It is surely time for the British political class to recognise that the British are no longer obsessed by foreign interference in the content of their sausages. At a deep level this generation have recognised that pooling sovereignty is not the same as losing it and that love of country is not incompatible with membership of the European Union.
The Popular Election of Existing Lords System (PEELS)
The system is designed to preserve the advantages of the existing Upper House while inserting an element of popular election. The composition of the House would remain the same, but with the identification of four hundred “Voting Peers”. Voting Peers would be elected for a five year term, using a system of Proportional Representation with a nation wide “closed list” system and a 10% threshold. Candidates standing for such an election would have to be existing members of the House of Lords, either hereditary or life. The elections would be held on the same day as elections to the European Parliament. Using a closed list system, the ballot paper would offer the electorate a choice of parties; Conservative, Labour, Liberal Democrat, Green, etc. In addition the elector could vote for an “Independents” list presented by the Cross Bench Peers. All existing peers would continue to have attendance and speaking rights, both on the floor of the Chamber and in committee, but only the four hundred voting peers could take part in recorded voting. The Bishops of the Church of England would continue to sit in the Lords, but would not be voting peers. The choice and ranking of the lists would be decided amongst themselves by the peers taking each party or cross bench whip.
The Advantages of the Proposal
- PEELS is designed to preserve the continuity, expertise and independence of the House of Lords.
- It sidesteps the hereditary versus life peers debate, replacing it with a distinction between voting and non-voting peers.
- It avoids the danger of a Quango House, because the voting balance would be decided by democratic mandate rather than by Prime Ministerial nomination.
- PEELS produces an elected Second Chamber, which does not mirror the composition of the House of Commons, and does not have a strong enough democratic mandate to clash with the Commons on fundamentals. Its mandate would however be strong enough to credibly exercise the prerogatives of the existing House of Lords of revision and moderate delay.
- Holding the election on the same day as elections to the European Parliament avoids extra cost and might bolster the turnout for both elections. The first election under this system could therefore take place in June 2014 thereby fulfilling the terms of the Coalition Agreement.
- The use of a “closed list” system avoids the need for individual peers to engage in campaigning.
- The Independent/Cross Bench list might expect to attract considerable popular support. The threshold is set deliberately high, at 10%, in order to avoid the problem of fringe parties without support among existing Lords being elected. It is a reasonable test of a party’s seriousness that it should be able to find candidates to represent it amongst the existing full membership of the Upper House.
- Special arrangements concerning the threshold would have to be made for regional parties in Scotland, Wales and Northern Ireland.
- A situation where individuals were sent to the House of Lords to fill a quota entitlement that could not be met from their existing membership would not be acceptable. It is conceivable that where a party list won more voting rights than its current membership in the House of Lords, its existing Voting Peers would be entitled to cast more than one vote.
- In the event of the death or resignation of a Voting Peer, his or her place would be taken by the next name on the list presented at the time of the previous election.
- While nominated by a Party or Cross Bench list, Peers would of course retain the right to cast their own vote in whatever way they saw fit as parliamentarians.