The European Union
History of the EU
On 9 May 1950, the Schuman Declaration proposed the establishment of a European Steel and Coal Community (ECSC), which became reality with the Treaty of Paris of 18 April 1951. This put in place a common market in coal and steel between the six founding countries (Belgium, the Federal Republic of Germany, France, Italy, Luxembourg and the Netherlands). The aim, in the aftermath of World War Two, was to secure peace between Europe’s victorious and vanquished nations and bring them together as equals, cooperating within shared institutions.
The Six then decided, on 25 March 1957 with the Treaty of Rome, to build a European Economic Community based on a wider common market covering a whole range of goods and services. Customs duties between the six countries were completely abolished on 1 July 1968 and common policies, notably on trade and agriculture, were also put in place during the 1960s.
So successful was this venture that Denmark, Ireland and the United Kingdom decided to join the Community. This first enlargement, from six to nine members, took place in 1973. At the same time, new social and environmental policies were implemented, and the European Regional Development Fund (ERDF) was established in 1975.
Since then the EU has grown in influence and numbers, from nine members to twenty-seven.
How It Works
(a) The Council of the European Union and the European Council
The Council of the European Union (also known as the Council of Ministers) is the EU’s main decision-making body. The EU member states take it in turns to hold the Council Presidency for a six-month period. Every Council meeting is attended by one minister from each EU country. Which ministers attend a meeting depends on which topic is on the agenda: foreign affairs, agriculture, industry, transport, the environment, etc.
The Council has legislative power, which it shares with the European Parliament under the co-decision procedure. In addition to this, the Council and the Parliament share equal responsibility for adopting the EU budget. The Council also concludes international agreements that have been negotiated by the Commission.
According to the Treaties, the Council has to take its decisions either by a simple majority vote, a qualified majority vote or unanimously, depending on the subject to be decided.
The Council has to agree unanimously on important questions such as amending the Treaties, launching a new common policy or allowing a new country to join the Union.
In most other cases, qualified majority voting is used. This means that a Council decision is adopted if a specified minimum number of votes are cast in its favor. The number of votes allocated to each EU country roughly reflects the size of its population.
The European Council meets, in principle, four times a year. It is chaired by the president or prime minister of the country holding the presidency of the Council of the European Union at the time. The President of the European Commission attends as a full member.
Under the Treaty of Maastricht, the European Council officially became an initiator of the Union’s major policies and was empowered to settle difficult issues on which ministers meeting in the Council of the European Union fail to agree.
The European Council also deals with pressing international issues through the common foreign and security policy (CFSP), which is intended to allow the EU to speak with one voice on diplomatic questions.
(b) The European Parliament
The European Parliament is the elected body that represents the EU’s citizens. It exercises political supervision over the EU’s activities and takes part in the legislative process. Since 1979, members of the European Parliament (MEPs) have been directly elected, by universal suffrage, every five years.
The European Parliament also shares, with the Council, equal responsibility for adopting the EU budget. The Parliament can reject the proposed budget, and it has already done so on several occasions. When this happens, the entire budget procedure has to be re-started. The European Commission proposes the draft budget, which is then debated by the Council and the European Parliament. Parliament has made full use of its budgetary powers to influence EU policymaking.
Last but not least, the European Parliament exercises democratic supervision over the Union. It has the power to dismiss the Commission by adopting a motion of censure. This requires a two-thirds majority. It also supervises the day-to-day management of EU policies by putting oral and written questions to the Commission and the Council. Finally, the President of the European Council reports to the Parliament on the decisions taken by the Council.
(c) The European Commission
The Commission is the third part of the institutional triangle that manages and runs the European Union. Its members are appointed for a five-year term by agreement between the member states, subject to approval by the European Parliament. The Commission is answerable to the Parliament, and the entire Commission has to resign if the Parliament passes a motion of censure against it.
Since 2004, the Commission has been made up of one Commissioner from each member state.
The Commission enjoys a substantial degree of independence in exercising its powers. Its job is to uphold the common interest, which means that it must not take instructions from any national EU government. As ‘Guardian of the Treaties’, it has to ensure that the regulations and directives adopted by the Council and Parliament are being implemented in the member states. If they are not, the Commission can take the offending party to the Court of Justice to oblige it to comply with EU law.
As the EU’s executive arm, the Commission implements the decisions taken by the Council in areas such as the common agricultural policy. It has wide powers to manage the EU’s common policies, such as research and technology, overseas aid, regional development, etc. It also manages the budget for these policies.
What Does the EU do?
I. Solidarity policies
The main purpose of the solidarity policies is to support the completion of the single market and to correct any imbalances by means of structural measures to help regions lagging behind or industrial sectors encountering difficulties. The need for solidarity between EU countries and between regions became even more acute following the recent entry of 12 newcomers with incomes well below the EU average. The EU must also play its part in helping to restructure sectors of the economy which have been badly affected by fast-growing international competition.
(a) Regional aid
The EU’s regional policy is based on transfers of funds from rich to poor countries. The money is used to boost development in regions lagging behind, to rejuvenate industrial regions in decline, to help young people and the long-term unemployed find work, to modernize farming and to help less-favored rural areas.
The funds earmarked for regional activities in the 2007–13 budget are targeted at three objectives.
The European Regional Development Fund is the first Structural Fund and provides funding to strengthen economic, social and territorial cohesion by reducing differences between regions and supporting the structural development and adjustment of regional economies, including the redevelopment of declining industrial regions.
The European Social Fund, the second Structural Fund, provides funding for vocational training and job-creation initiatives.
In addition to the Structural Funds, there is a Cohesion Fund , which is used to finance transport infrastructure and environmental projects in EU countries whose GDP per capita is lower than 90 % of the EU average.
(b) The common agricultural policy (CAP)
The aims of the CAP, as set out in the original Treaty of Rome from 1957, have largely been achieved: a fair standard of living has been ensured for the farming community; markets have been stabilized; supplies reach consumers at reasonable prices; farming infrastructure has been modernized. Other principles adopted over the course of time have also worked well. Consumers enjoy security of supply and the prices of agricultural products are kept stable, protected from fluctuations on the world market.
However, the CAP has been a victim of its own success. Production grew far faster than consumption, placing a heavy burden on the EU budget. In order to resolve this problem, agriculture policy had to be redefined. This reform is beginning to show results. Production has been curbed. Farmers are being encouraged to use sustainable farming practices that safeguard the environment, preserve the countryside and contribute to improving food quality and safety.
The new role of the farming community is to ensure a certain amount of economic activity in every rural area and to protect the diversity of Europe’s countryside. This diversity and the recognition of a ‘rural way of life’ — people living in harmony with the land — are an important part of Europe’s identity.
The European Union wants the World Trade Organization (WTO) to put more emphasis on food quality, the precautionary principle and animal welfare. The European Union has also begun reforming its fisheries policy. The aim here is to reduce the overcapacity in fishing fleets, to preserve fish stocks and to provide financial assistance to allow fishing communities to develop other economic activities.
(c) The social dimension
The aim of the EU’s social policy is to correct the most glaring inequalities in European society. The European Social Fund (ESF) was established in 1961 to promote job creation and help workers move from one type of work and/or one geographical area to another.
Financial aid is not the only way in which the EU seeks to improve social conditions in Europe. Aid alone could never solve all the problems caused by economic recession or by regional under-development. The dynamic effects of growth must, above all, encourage social progress. This goes hand in hand with legislation that guarantees a solid set of minimum rights. Some of these rights are enshrined in the Treaties, e.g. the right of women and men to equal pay for equal work. Others are set out in directives concerning the protection of workers (health and safety at work) and essential safety standards.
In 1991, the Maastricht European Council adopted the Community Charter of Basic Social Rights , setting out the rights that all workers in the EU should enjoy: free movement; fair pay; improved working conditions; social protection; the right to form associations and to undertake collective bargaining; the right to vocational training; equal treatment of women and men; worker information, consultation and participation; health protection and safety at the workplace; protection for children, the elderly and the disabled. At Amsterdam in June 1997, this Charter became an integral part of the Treaty and is now applicable in all the member states.
II. Innovation policies
The European Union’s activities impact on the day-to-day life of its citizens by addressing the real challenges facing society: environmental protection, health, technological innovation, energy, etc.
(a) The environment and sustainable development
The cornerstone of the EU environmental plan is an action program entitled ‘Environment 2010: our future, our choice‘. This covers the period from 2001 to 2010 and emphasizes the need to:
mitigate and slow down climate change and global warming;
protect natural habitats and wild fauna and flora;
deal with problems linked to environment and health;
preserve natural resources and manage waste efficiently.
Throughout the period covered by this program and the five programs preceding it, and in more than 30 years of setting standards, the EU has put in place a comprehensive system of environmental protection.
The problems being tackled are extremely varied: noise, waste, the protection of natural habitats, exhaust gases, chemicals, industrial accidents, the cleanliness of bathing water and the creation of a European information and assistance network for emergencies, which would take action in the event of environmental disasters such as oil spills or forest fires.
European regulation provides the same level of protection throughout the EU, but is flexible enough to take account of local circumstances. It is also constantly being updated. For example, it has been decided to rework the legislation concerning chemicals and replace earlier rules, which were developed on a piecemeal basis, with a single system for the registration, evaluation and authorization of chemicals (REACH).
This system is based on a central database being run by a new European Chemicals Agency, located in Helsinki. The aim is to avoid contamination of the air, water, soil or buildings, to preserve biodiversity and to improve the health and safety of EU citizens while at the same time maintaining the competitiveness of European industry.
III. Paying for Europe: the EU budget
To fund its policies, the European Union has an annual budget of more than €120 billion. This budget is financed by what is called the EU’s ‘own resources’, which cannot exceed an amount equivalent to 1.24 % of the total gross national income of all the member states.
These resources are mainly drawn from:
· customs duties on products imported from outside the EU, including farm levies;
· a percentage of the value-added tax applied to goods and services throughout the EU;
· contributions from the member states in line with their respective wealth.
Each annual budget is part of a seven-year budget cycle known as the ‘financial perspective’. The financial perspectives are drawn up by the European Commission and require unanimous approval from the members.
The Future of the EU
The current technological revolution is radically transforming life in the industrialised world, including Europe. It is vital to understand that this creates new challenges that transcend traditional frontiers. Sustainable development, population trends, economic dynamism, social solidarity and an ethical response to progress in the life sciences are issues that can no longer be effectively dealt with at national level. The EU must also keep an eye on the future.
The process of European integration now affects the whole continent, which, in turn, is part of a rapidly and radically changing world that needs to find new stability. Europe is affected by events on other continents, whether it be relations with the Islamic world, disease and famine in Africa, unilateralist tendencies in the United States, the dynamic economic growth in Asia or the global relocation of industries and jobs. Europe must not only concentrate on its own development but also embrace globalization.
The EU institutions have proved their worth, but they must be adapted to cope with the enlargement of the Union and the increasing number of tasks for which it is responsible. The bigger the number of members, the greater the centrifugal forces that threaten to tear it apart. Short-term interests can all too easily derail long-term priorities. Any definitive change in the present system must ensure plurality and respect the differences that are the most precious assets of Europe’s nations. Reforms must also concentrate on the decision-making process. Insisting on unanimous agreement in all cases would simply lead to paralysis. The only kind of system that will work is a political and legal system based on majority voting, with checks and balances built in.
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