Two Problematic Modes of European Integration: Social Standards and the Rule of Law

Written by: Simon Eckert

1. Introduction

Two apparently disparate issues have recently become salient features of European politics. This article will focus on why both these issues are more connected to one another than they seem and why European policymakers need to think about the connections between these developments. The first concerns how well equipped the European Union (EU) is to guarantee and contribute to the social protection of its citizens. This is of utmost importance given the current context, as Coronavirus continues to stir up widespread economic and social difficulties. Despite hopes that the 2017 adoption of the European Pillar of social rights would “significantly [boost] the EU’s social credentials” (Garben, 2019: 126) by delivering “new and more effective rights for citizens” surrounding “equal opportunities”, “access to the labour market”, “fair working conditions”, “social protection” and “inclusion” (European Commission, n.d.), the ongoing pandemic presents a significant challenge to the realization of further social integration. By social integration, I mean convergence in living standards and social rights, especially regarding employee rights such as insurance, work safety and minimal wages. I do not mean primarily “discrimination-free transnational access to the social security systems of the member states” (Höpner& Schäfer, 2012: 446) – a definition that is sometimes given and can help understand the reasoning behind the two competing logics of social and market integration. However, since this analysis focuses on the need of social security within the member states, a different understanding is more useful. 

A second, highly problematic development is the recent deterioration of the rule of law in some member states. The debate around this issue has therefore gained traction, having consequences for broader policymaking. This was vividly illustrated, when Poland and Hungary vetoed the EU’s Multiannual Financial Framework (MFF) over a disagreement concerning a clause attempting to tie access to EU funds to respect of the rule of law (cf. Barigazzi et al., 2020). The existence of an overarching rule of law means the lawfulness of government decisions can be monitored by an independent judiciary, whilst also forcing governments to respect court decisions that may not favour their political preferences. 

Even when the future of the MFF, which is needed to mitigate the socio-economic consequences of the pandemic, was in danger, the connection between the problematic trends concerning the rule of law and the social protection of EU citizens was rarely drawn. These trends both severely threaten the EU’s legitimacy and credibility. The first trend is the so-called “authoritarian equilibrium” (Kelemen, 2020). The second concerns the bias of EU integration towards economic harmonization, as opposed to social policy. Economic Integration is understood as the process of constantly improving the single market through the dismantling of trade barriers and the EU-level regulation of consumer-markets (Scharpf, 2010, Scharpf, 2008). The “authoritarian equilibrium” refers to structural issues in the EU’s governance that may sustain authoritarian trends in member states (Kelemen, 2020).   

2. Two dangerous balances

The first issue is the logic of European integration, causing integration of the EU’s domestic market to occur more quickly than the integration and harmonization of EU social standards. Fritz Scharpf has pointed out that the integration of the European legal system promotes a fundamental asymmetry between the removal of trade barriers and the expansion of a European regulatory system concerning minimal social standards. On one hand, negative integration, or the dismantling of barriers for trade, is mainly driven by the judiciary at the European level (Scharpf, 2008: 54-56). On the other hand, positive integration, the introduction of common social minimum standards, would be achieved through the more complicated political process at the EU level and is therefore more often prevented from being realized (Scharpf, 2008: 54). This structural issue has recently become dangerous, contributing to a disconnection between the preferences of EU citizens and policies adopted by European policymakers. This disconnection was caused as a result of the budgetary restrictions for nation-states at the European level that prevent member states from adopting their “social policy output to the preferences of the national citizens” (Tober and Busemeyer, 2020: 16). This disconnect is especially problematic since it is likely that the demand for social policy increases with increased exposition to market forces. Therefore, the structure of the current economic European integration is likely to limit the capability of national policymakers to respond to their citizens’ preferences. This means the structure of economic integration is likely to harm the legitimacy of the EU itself (ibid.: 3). 

The second issue concerns the EU’s democratic legitimacy. This focuses on the EU’s ability to stabilize democratic backsliding in some member states, as opposed to considering the frequently debated issue surrounding whether the EU’s institutions offer the right level of member state and citizen representation (see Follesdal and Hix, 2006, Majone, 1998, Moravcsik, 2002). To unpack this issue, it is important to note that there seem to be clear indicators that democratic backsliding has occurred to a significant degree in the new member states. Interestingly, there are some signs that this might also be related to the EU’s structure. Kemelen has argued that “[t]hree factors underpin the EU’s authoritarian equilibrium: partial politicisation, money and migration” (Kelemen, 2020: 482). He argues there are strong incentives for Europarties to protect national member parties delivering them votes, regardless of possible deterioration of democratic standards in their nation-states. Furthermore, EU-Membership offers access to foreign direct investment on a scale they might otherwise be unlikely to attract, whilst also facilitating movement of citizens dissatisfied with politics in their home country (see ibid.: 483, Kelemen, 2017). Additionally, politicization might contribute to maintaining autocratic regimes to survive at federal or similar levels, even if democracy is highly valued in a polity. This argument seems to fit for the EU, as there are many attempts at the EU level to stop the dangerous trend of democratic backsliding, yet most of them have proven incapable of fulfilling the hopes some have placed in them (Sedelmeier, 2017). 

3. A combined threat to legitimacy 

Following this logic, the debate about the rule of law has now become connected to the EU’s increased demand for social spending in the face of the current pandemic. This points to deeper trouble for the EU that goes beyond the recent dispute over the MFF. There were even reports of plans to cut Hungary and Poland out of the recovery scheme, so that the European Parliament would not have needed to ratify the program (de la Baume & von der Buchhard, 2020). This should be a warning that there is no “rally-round the flag effect” in terms of European politics through an existential crisis. Aside from that, the bigger issue for the EU is that these developments might become a serious threat to its democratic legitimacy if they continue. According to Scharpf there are two main aspects by which the legitimacy of a political regime can be judged. Firstly, input-legitimacy is drawn from a “pluralistic” way of policymaking that is “responsive to citizen interests and preferences” (Scharpf, 2009a: 8,20). This is something that the EU cannot claim fully because the prevention of the domination of smaller member states sets structural limits to the responsiveness of the popular will in bigger member states (ibid). Secondly, output legitimacy is drawn from the effectiveness of policy making (Scharpf, 2009b; Scharpf, 2009a), something that the EU is capable of since it “has developed considerable effectiveness as a regulatory authority”, even if this capacity is  “constrained by the extremely high consensus requirements of EU legislation” (Scharpf, 2009a: 9).

4. The value of implicit conditionality

Any polity incapable of assisting its citizens when most needed is likely to be severely delegitimized. Additionally, these developments are likely to not only harm the EU’s output-legitimacy, but also its input-legitimacy, as it is likely that the preference for social spending will further increase during and after the economic hardship caused by the pandemic. Another important point is that it might become increasingly hard to justify a possible compromise on the conditionality mechanism in states where populations have experienced high conditionality requirements connected to EU-funded assistance in the recent past (Featherstone, 2015, Sacchi, 2015).

Whilst the original idea to discuss matters of social policy and rule of law with the degree of connection they should have in a polity abiding by a high standard of accountability appeared to be sensible, it seems that this approach might have backfired. However, policymakers should not hesitate to further improve the standard of social protection across “Social Europe”, but rather start to look for ways to implement “implicit conditionality” (Sacchi, 2015: 78), for example through adjustments in the activities of the European Investment Bank or other EU authorities. Therefore, it is fundamentally importance to keep in mind the citizens’ urgent need for protection from social hardships and the issues surrounding the rule of law. 

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