Review by Olivier Charnoz

 

 

· Within the American political science, the dominant paradigm in International Relations is intergovernmentalist : Member States (MS) remain the only important actors at the European level ; the EC is a forum for inter-state bargaining.

· European scholars have generally depicted the EC less firmly under MS control, concentrating on the detailed investigation of day-to-day policy development. Analysis that treat Europe as a quasi federal system are now quite common (Majone, Scharpf, Dehouse).

 

· The neofunctionalist criticism of intergovernmentalism tries to show how spillover processes and the autonomous actions of supranational actors. Yet neofunctionalism has serious problems. There is no doubt that the MS acting together in the Council, remain the most powerful decision makers. Thus at any given point in time the key proposition of intergovernmentalism are likely to hold.

· Therefore this article seeks 1) a new criticism of intergovernmentalism. 2) to lay the foundations of Historical Institutionalism, by stressing the importance of unexpected consequences.

· The crucial claim is that actors may be in a strong initial position, maximise their interests, and nevertheless carry out reforms that transform over time their position in ways that are unanticipated.

· Þ At any given time, intergovernmentalist perspective makes considerable sense. However, seen as a historical process the scope of MS authority is far more circumscribed. (short/long run)

· Three parts : 1) review of the main features of intergovernmentalism 2) historical institutionalist critique 3) example : Social Policy.

 

1. Intergovernmentalist theories and member-state autonomy.

 

 

· In the past decade, dominance if intergovernmentalism Þ EC as a standard international regime.

· We focus her on three core features : the emphasis on MS preoccupation with sovereignty, the depiction of institutions as instruments, and the focus on « grand bargains » among MS.

 

The centrality of sovereignty

· Intergovernmentalist accounts tend to stress MS preoccupation with preserving sovereignty (Keohane).

· The principals (MS) may delegate certain responsibilities to agents (international institutions), but only with the strictest oversight. The core calculation for MS is whether the benefits of collective action outweigh any possible risk to autonomy.

 

The instrumentality of institutions

· Transaction Costs Economics (TCE) analyses institutions in functional terms, 'as deliberate instruments to improve the efficiency of bargaining between states' (Moravcsick 1993).

· The best way to understand the development of international institutions is to identify the functions they fulfil : lowering the bargaining costs, reducing uncertainty and information asymmetry, and monitoring compliance.

 

The centrality of intergovernmental bargains

· Distinction between the intermittent grand bargains (e.g., the Treaty of Rome, the SEA, Maastricht) that establish basic feature of institutional design and the day-to-day policy making.

· For intergovernmentalists, the grand bargains are where the action is.

2. A historical institutionalist critique.

 

· Historical Institutionalism holds that social processes must be understood as historical. Refuses 'snapshot views'

Two question : 1) why gaps emerge ? (gaps = significant divergence between the preferences of MS and the actual functioning of institutions and policies)  2) Why can't they be closed, once emerged ?

2.1 Why gaps in MS state control emerge ?

 

· Four factors are likely to create considerable gaps.

The partial autonomy of EC institutions (neo-functionalist criticism of intergov)

 

· The central objections raised by no-functionalists can be cast in terms of the same principal-agent framework used in many intergovernmentalist accounts. Over time, EC organisations will seek to use grants of authority for their own purposes, especially to increase their autonomy. Significant successes.

· The Commission has two important sources of influence : 1) the setting of agendas (shared with the EP) - choosing which proposal to consider 2) role as process manager (Eichner) - assembly and regulation of a dense network of experts.

· The European Court of Justice has significant resources as well : 1) constitutionalised the emerging European polity 2)extensive powers of judicial review 3) simple majority decision and secrecy Þinclines the Court to action 4) European courts have a common professional background, legal culture, and sense of mission that limit the influence of the MS.

· However a crucial problem with neo-functionalism is that it lacks a coherent account of why the threat of MS reaction is not always credible. The article address this question below (see 2.2)

· The Historical Institutionalist focus on temporal dimension allows to highlight three additional sources of gaps :

The restricted time horizon of political decision maker

 

· Many implication of political decisions only play out in the long run. Yet political decision makers are frequently most interested in the short-term consequences of their actions. The principal reason for that is that of the logic of electoral politics.

· The first concern of national governments is not with sovereignty per se but with creating the conditions for continued domestic political success.

· The gap between short term and long term consequences is often ignored in arguments about institutional design. The article claim that long term institutional consequences are often the by-product of actions taken for short term political reasons.

· Conclusion : gap in MS control occur because long-term consequences tend to be heavily discounted.

Unanticipated consequences

 

· Unanticipated consequences are likely to be of particular significance in the EU because of the presence of high issue density, i.e. the EC deals with many tightly coupled issues. Interactions cannot be fully comprehended.

· As the number of decisions made and the number of actors involved grow, interaction among actors and among policies increase geometrically (Beer, 1978).

· Growing issue density has two consequences : 1) problems of overload Þ need to delegate decisions to experts Þ considerable gap in MS control  2) process of spillover (e.g., monetary/agricultural policies, Single market/Social policy)

       Shifts in COG policy preferences

 

· Intergovernmentalism treats the institutional and policy preferences of the MS as essentially fixed.

· However they may shift because of 1) altered circumstances 2) new information 3) changes in governments

· The result over time is that evolving arrangements will diverge from the intentions of original designers.

 

2.2 For intergovernmentalists, these loses of control are considered unproblematic !

 

· For intergovernmentalists, these loses of control are considered unproblematic. Should outcomes occur that principals do not desire, the Transaction Cost Theory (TCE) describes two routes to restore efficiency : competition and learning (Williamson, 1993)

· However both these corrective mechanisms are of limited applicability when one shift from a focus on firms in private markets to the world of political institutions.

 

·Competition argument : Political institutions rarely confront a dense environment of competing institutions. There is nothing like a marketplace for competition among international regimes Þ arguments based on competition are weak.

· Learning argument (actors learn about gaps in control and address them) appear to be more applicable. However, the following section shows three broad reasons why gaps are hard to close.

 

2.3 Why are gaps (even when identified) hard to close ?

 

The resistance of supranational actors

· Important but not sufficient. Neo-functionalism has failed to address the question of why, in an open confrontation between MS and supra-national actors, the latter could ever be expected to prevail.

· Therefore a persuasive account of MS constraint must draw on more than political resources of supranational actors.

 

Institutional barriers to reform

· The efforts of principals to reassert control will be facilitated if they can easily redesign policies and institutions. But political institutions are often 'sticky'.

· A Treaty revision, face extremely high barriers : unanimous MS agreement, plus ratification by national parliaments and (in some cases) electorates. As Pollack (1995) notes, « the threat of Treaty revision is essentially the 'nuclear option', and is therefore a relatively ineffective and non-credible means of MS control ».

· The rules governing institutional and policy reform in the EC create what Scharpf calls a « joint-decision trap », making MS efforts to close the gaps in control highly problematic.

 

 Sunk cost and the rising of price exit

· Individual and organisational adaptations to previous decisions generate massive sunk costs that make policy reversal unattractive.

· Although 'sovereign' MS remain free to walk away at any time, the constantly increasing costs of exit from existing arrangements have rendered this option virtually unthinkable  Þ this is the 'lock-in argument'.

· Recent work has emphasised the ways in which initial institutional or policy decisions - even suboptimal ones- can become self-reinforcing over time.

 

 

 

Conclusion

· Historical Institutionalism (HI) provides a clear account of why gaps emerge and can not be easily closed.

· Crucial contrast : whereas intergovernmentalism focus on the initial bargain at time (To), HI emphasise the need to analyse the consequences of that bargain over time. Doing so it reveals the potential for considerable gaps in MS control (T1). When the time of the next grand bargain arrives (T2), MS will again be central actors, but in a considerably altered context (new constraints).

3. The case of European Social Policy.

 

· Social policy is widely considered to be an area where MS control remain unchallenged. Requirements of unanimous European Council. Ms jealously protect social policy prerogatives.

· However HI can explore three aspects of policy development that significantly extend beyond the firm control of MS.

The EC and Gender Equality

· It is clear that MS did not seek any central role for the EC in this matter. The EC extensive role must be considered an unintended by-product of the Community's original institutional design.

· The key development was the inclusion of Article 119 of the Treaty of Rome ('equal pay for equal work). Indeed, the mandate to address pay inequities lay dormant for almost two decades.

 · An opening occurred when the policy preferences of MS shifted in the early 1970s, a time when women's movements were gathering strength in many countries. Politicians sought a symbolic response Þ the Council agreed to several directives. They were passed without much awareness of their consequences Þ now far from symbolic, Article 119 transferred much power to the ECJ Þ activist role.

Workplace health and safety

· Another instance of gaps in MS control : health and safety regulations.

· Openings came with the SEA, which allowed qualified majority voting on these issues. A high level of standards has been achieved (often higher than of any MS !)

· The role of the Commission as process manager (delegation of authority required to pursue complex regulatory policy) has been critical. Much of the crucial decision making took place in committees composed of policy experts.

· In this field, the complexity of regulatory policy making has generated considerable gaps in MS control. « The complex, opaque and Commission-dominated decision-making process leads to results which would never be expected from simple intergovernmental bargaining within the Council » (Lange, 1993)

The Maastricht social protocol

· The protocol (signed by 11 MS) allows QMV on a range of important issues, including working conditions, gender equality with regard to labour market. Already the Commission has used the protocol to push through the long-stalled European Work Council Directive.

· The social protocol leaves tremendous room for unanticipated consequences.

 

Overall Conclusion

· Historical Institutionalism present a major challenge to an intergovernmentalist account of European integration. HI places much more emphasise on member-state constraint.

· It would be folly to suggest that the MS do not play a central part in policy development within the EU. Rather the point of the article is that they do so in a context that they do not fully control.

· Intergovernmentalist focus on grand bargains, fail to capture the implications of a complex agenda of shared decision making.

· The path to European integration has embedded MS in a dense institutional environment that cannot be understood in the language of interstate bargain.

 

 

 

 

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