At Maastricht, it was the much-publicized agreement to establish a common European currency that caught public attention. The French, to overcome their anxiety at German unification, bound the Federal Republic firmly into the ‘West’ by getting Bonn to agree to abandon the Deutschmark for a single European currency unit—the euro—and by committing the enlarged German state to operating within the constraints of a European Union bound by an ever-denser mesh of laws, rules and agreements Bonn, in return, insisted that the new currency be a carbon copy of the old Deutschmark, regulated—like the German currency—by an autonomous board of central bankers and committed to the fiscal principles of the German central bank: low inflation, tight money, and minimal deficits. The German negotiators—wary of the profligate tendencies of ‘Club Med’ countries like Italy or Spain— imposed draconian conditions for membership of the new currency, with the European Commission authorized to impose fines upon reprobate governments.

At Bonn’s behest, Europe’s finance ministers would thus be bound, Ulysses-like, to the euro-mast: unable to respond to the Siren-calls of voters and politicians for easier money and increased public spending. These terms, designed to insure that the new euro would be as inflation-proof as the Deutschmark itself, were not universally popular—in the poorer member states it was widely and rightly feared that they would constrain public policy and perhaps even prevent growth. And so, in order to make the Maastricht conditions more palatable, cash bonuses were made available to recalcitrant governments: Jacques Delors, the Commission President, all but bribed the finance ministers of Greece, Spain, Portugal and Ireland, promising large increases in EU structural funds in return for their signatures on the Treaty.

The UK and Denmark, meanwhile, signed the main body of the Treaty but opted out of the proposed common currency—partly in anticipation of its economically restrictive impact; partly because of its symbolic resonance in nations already more reluctant than most to abandon the trappings of sovereignty to transnational agencies; and in the case of the UK because—as so often in the past—the march to Union was regarded with acute misgivings as a further step towards a European super state.[361]

To be sure, the Maastricht Treaty made much play with ‘subsidiarity’—a sort of Occam’s Razor for eurocrats, stating that ‘the Union does not take action (except in the areas which fall within its exclusive competence) unless it is more effective than action taken at national, regional or local level’. But even this had different meanings for different ears: in France it meant limiting the power of supernational bodies beyond Paris’s control; for the Germans, it implied special privileges and powers for regional governments; for the British it represented a device for blocking institutional integration.

Maastricht had three significant side-effects. One of them was the unforeseen boost it gave to NATO. Under the restrictive terms of the Treaty it was clear (as the French at least had intended) that the newly liberated countries of eastern Europe could not possibly join the European Union in the immediate future—neither their fragile legal and financial institutions nor their convalescent economies were remotely capable of operating under the strict fiscal and other regulations the Union’s members had now imposed upon all present and future signatories.

Instead, it was suggested in the corridors of Brussels that Poland, Hungary and their neighbours might be offered early membership of NATO as a sort of compensation: an interim prize. The symbolic value of extending NATO in this way was obviously considerable, which is why it was immediately welcomed in the new candidate member-states. The practical benefits were less obvious (unlike the damage to relations with Moscow which was real and immediate). But because Washington had reasons of its own for favouring the expansion of the North Atlantic Defense community, a first group of central European nations was duly admitted to NATO a few years later.[362]

The second impact was on European public awareness. The Maastricht Treaty provoked an unprecedented level of interest in what had hitherto been the obscure workings of the European Union and its anonymous bureaucracy. Even though the Treaty was approved in every country where it was put to a national vote (albeit by just 50.1 percent in the French case) it aroused sufficient opposition to place the question of ‘Europe’ on domestic political agendas, often for the first time. For four decades, the institutions and rules of a new continental system had been quietly designed and decided in obscure Benelux towns with no reference to public wishes or democratic procedure. Those days, it appeared, were over.

The third consequence of Maastricht was that it cleared the way for the coming together not, indeed, of Europe, but at least of its western half. The end of the Cold War, and the EU’s commitment to a single market, removed the impediments to membership for the remaining members of the old European Free Trade Area.[363] Sweden, Finland and Austria all duly applied, no longer constrained by their commitment to neutrality (or, in the Finnish case, by the need to maintain good relations with Moscow) and increasingly nervous at being left out of the common European space.

The accession negotiations with the new applicants were completed in just three months, facilitated by the fact that all three countries were not only stable and small—their combined population less than one quarter that of Germany—but also decidedly rich. The same would have been true of the last remaining hold-outs, Norway and Switzerland. But despite considerable enthusiasm on the part of local business leaders the populations of both countries voted against membership—fearful of losing their autonomy and initiative in a supranational federation and skeptical of the benefits of participation in the new currency.

A comparable skepticism marked the closeness of the vote in Sweden in November 1994, when EU membership was put to a referendum. Just 52.3 percent voted in favour, and even then only on the understanding that their country would stay out of the common currency (ten years later, when the government in Stockholm recommended to the nation that they finally abandon the krone and join the euro, it was decisively and humiliatingly defeated in a referendum, just as the Danish government had been in September 2000 when it posed the same question). The reaction of Per Gahrton, Swedish Riksdag member for the Green Party and a bitter opponent of EU membership, echoed a widespread Scandinavian anxiety: ‘This is the day that the Riksdag decided to transform Sweden from an independent nation to a sort of province within an expanding superpower, in the process converting itself from a legislative body to little more than an advisory panel’.

Gahrton’s feelings were shared by many northern Europeans, including some who nonetheless voted in favour of membership. Even those in the Swiss or Scandinavian political and business elites who wanted to join the EU, so as not to miss out on the benefits of the single market, recognized that there were economic and political costs to that option: in private they conceded that if the decision went against them it would not be an unmitigated disaster for their countries. In Sweden—or Norway, or even Denmark and the UK—the EU (not to speak of its newly integrated currency) was seen as a choice, not a necessity.

In Central and Eastern Europe however, membership of ‘Europe’ was the only possible option. Whatever their reasoning—whether it was to modernize their economies, secure new markets, obtain foreign aid, stabilize their domestic politics, lock themselves into ‘the West’ or simply head off the temptation of a retreat into national Communism—the new rulers from Tallinn to Tirana looked to Brussels. The prospect of joining the EU, with its promise of affluence and security, was dangled temptingly before the liberated electorates of post-Communist Europe. Don’t be seduced by those who tell you it was better under the old system, they were warned. The pain of transition will have been worth it: Europe is your future.[364]

Seen from Brussels, however, the picture was quite different. From the outset the European project was deeply schizophrenic. On the one hand it was culturally inclusive,open to all the peoples of Europe. Participation in the European Economic Community, the European Community and finally the European Union itself was the right of any European state ‘whose system of government is founded on the principles of democracy’ and which agreed to accept the terms of membership.

But on the other hand the Union was functionally exclusive. Each new agreement and treaty had further complicated the requirements placed upon member-states in return for binding them into the ‘European’ family; and these regulations and rules had the cumulative result of building ever-higher fences to keep out countries and peoples who could not meet the tests. Thus the Schengen Treaty (1985) was a boon for the citizens of participating states, who now moved unhindered across open borders between sovereign states. But residents of countries outside the Schengen club were obliged to queue—quite literally—for admission.

Maastricht, with its rigid requirements for a common currency and its insistence that all aspiring member- states integrate into their systems of governance the acquis communautaire, the rapidly

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