the politics of europe 2000: unity through diversity?

Industrial Relations Journal 32:5ISSN 0019-8692

The politics of Europe 2000:Unity through diversity?

Erik Jones

The December 2000 negotiations of yet another set of treaty revisions signalled formany a return to the bad old days of stagnation in the process of European inte-gration. With an egocentric France, a distracted Britain, and a reluctant Germanythreatening to transform Europe’s institutions into a large-power condominium, theemphasis on preserving the national interest even at the expense of a European futurewas all too apparent. That the bickering extended into conflicts between middle-sized Holland and slightly smaller Belgium, and between those countries inside theUnion and those waiting to join, illustrated that the desire for national grandeuroperates at all levels. Meanwhile, Europe’s single currency struggled against the dol-lar, its economy began to lose steam, its bureaucrats resisted reform, and its militaryaspirations promised to engender more conflict than cooperation. By all appearances,the European Union (EU) had lost direction.

Still, looks can be deceiving and in Europe they often are. Behind the images ofstagnation, the process of European integration changed tack in the year 2000.Specifically, politicians and policy makers in the EU consolidated a movement awayfrom traditional conceptions of the relationship between European unity and nationaldiversity. Rather than focusing on the tension between unity and diversity or itsabsence (unity with diversity), they chose to pursue the possibilities of a complemen-tary or even supportive relationship between the common objectives of integrationand the maintenance or development of national distinctiveness. This shift towardthe promotion of unity through diversity centred on three principles and three areasof activity:

� the ‘principle of differentiation’ applied in the aftermath of the December 1999Helsinki summit, which provides for countries wishing to join the EuropeanUnion to pace the negotiation of entry according to national circumstancesand capabilities;

� the ‘open method of coordination’ introduced at the March 2000 Lisbon summit,which encourages member states to support one-another in the pursuit of

❒ Erik Jones is Jean Monnet Senior Lecturer in European Politics and Director of the Centre for theStudy of European Governance at the University of Nottingham.

Blackwell Publishers Ltd. 2001, 108 Cowley Road, Oxford OX4 1JF, UK and 350 Main St., Malden, MA 02148, USA.

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national targets for welfare state reform in line with broader European objec-tives; and,

� the principle of ‘enhanced cooperation’ established at the December 2000 Nicesummit, which affords groups of member states the opportunity to exploredeeper integration with the provision that the process be left open for othersto join.

These principles were not new to Europe in 2000, and neither did they underwritea comprehensive revolution in the integration process. Nevertheless, taken togetherthey constitute an important change in the European approach to the relationshipbetween unity and diversity, and therefore also the approach to integration.

The challenge is to provide a framework for assessing the importance of this shift –and, by implication, its limitations. Such an assessment can provide an early indi-cation of the likely progress of integration in the three fields concerned: enlargement,domestic reform, and experimentation (or ‘pioneering’). At the same time, such anassessment can shed light on competing principles at work in the process of unifi-cation and so explain why the competition between unity and diversity remainspredominant elsewhere.

The argument in this essay is that the EU’s attempt to pursue unity through diver-sity is constrained in three areas. The principle of differentiation can function onlyso long as difference does not translate into inequality. The strategy of open coordi-nation can succeed up to the point at which idiosyncrasy becomes asymmetry orasymmetric vulnerability. And the encouragement of enhanced cooperation can pro-gress only in the absence of a competition for resources. Where inequality, asym-metry, and competition predominate, the tension between European unity andnational diversity cannot be dismissed. Hence where we can identify these con-straints in the areas of enlargement, domestic reform, and pioneering, we can alsoidentify the challenges that remain to be faced at the end of the year 2000.

This argument is developed in three sections. The first outlines the shift toward astrategy of unity through diversity in the areas already mentioned: enlargement, wel-fare-state reform, and pioneering. In doing so, the first section also elaborates theprinciple of differentiation, the strategy of open coordination, and procedure forenhanced cooperation. The second section then analyses these principles out of con-text. By examining progress in the areas of EU institutional reform, economic andmonetary union (EMU), and the European security and defence identity (ESDI), it ispossible to illustrate the constraints on the pursuit of unity through diversity. Thethird section concludes with the implications of this analysis for the future of Euro-pean integration.

Unity through diversityIn traditional conceptions of European integration, the tension between unity anddiversity is either manifest or it is irrelevant. Unity can work against diversity, aswhen countries converge around a common norm or assimilate a predominant set ofvalues and characteristics. Or unity can be irrelevant to diversity, as when countriesacknowledge points of common interest and agree to disagree on or ignore the rest(mutual recognition). The tension between unity and diversity is evident in the ‘com-munity method’ whereby integration operates through a single set of institutions inthe service of a single acquis communautaire or body of rules. That this communitymethod is at times unwieldy given the wide diversity of national experience is obvi-ous both in theory and in practice. Hence the promotion of unity with diversityconstitutes the essential change at the heart of the 1992 project to complete the singlemarket in Europe and so became part of the traditional conception of European inte-gration.

The notion that unity works against diversity or that diversity is at times irrelevantto unity is not exhaustive as a description of the relationship between unity anddiversity. In logic, at least, there may be times or areas in which unity and diversity

The politics of Europe 2000 363 Blackwell Publishers Ltd. 2001.

work together. This possibility has important political precedents. James Madison’s(1961) ‘Federalist 10,’ makes the argument that diversity is a necessary antidote to‘faction’ and so is a precondition for national integration. Closer to home, the arrayof regional organisations including the Council of Europe, the North Atlantic TreatyOrganization (NATO), the Organization for Economic Cooperation and Development(OECD), and so forth, all play a role in the process of European integration. Thatthe membership of these organisations differs constitutes a strength for the processof integration rather than a weakness.

These precedents for unity through diversity are characteristically different. WhereAmerican pluralism reflects individuality directly in terms of wants or aspirations,the plurality of organisations in Europe reflects diversity only indirectly, throughdiffering decisions (and qualifications) for membership. The challenge for analysis,then, is two-fold. First, it is to establish a range of principles for taking advantageof the supportive relationship between unity and diversity. Second, it is to examine(or anticipate) how these principles interact.

Enlargement and the principle of differentiation

The principle of differentiation is hardly earth-shattering when viewed up close.According to the Presidency Conclusions of the December 1999 Helsinki EuropeanCouncil summit, the idea is that:

In the negotiations, each candidate State will be judged on its own merits. This principle will applyboth to the opening of the various negotiating chapters and to the conduct of the negotiations. Inorder to maintain momentum in the negotiations, cumbersome procedures should be avoided(European Council, 1999: paragraph 11).

Nevertheless, this principle completely overturns the block negotiation strategy usedin all previous enlargements. Where before, groups of candidate countries were onlyable to open negotiation chapters as groups and without regard to the specific diffi-culties encountered by particular countries in particular areas, now countries couldmove through each chapter of negotiations at their own pace. In practice, the Euro-pean Commission would still require time to establish the initial position for the EUas well as its assessment (screening) of the candidates with respect to particular chap-ters. By implication, countries could not simply request negotiations in any area asand when convenient. However, where the Commission position was already estab-lished and the candidate assessments already in train, individual countries couldmake rapid progress. Indeed, this was the intention. Returning to the language ofthe Helsinki conclusions:

Candidate States which have now been brought into the negotiating process will have the possi-bility to catch up within a reasonable period of time with those already in negotiations if theyhave made sufficient progress in their preparations (European Council, 1999: paragraph 11).

The events behind this change in strategy took place in 1999 and are described inJones (2000b: 258). During the aftermath of the Kosovo conflict, the European Councilmeeting at the Cologne summit in June called upon the Commission to find waysto widen the scope of enlargement beyond the six countries already participating innegotiations – Cyprus, the Czech Republic, Estonia, Hungary, Poland, Slovenia. TheCommission reported back that the process of enlargement could be broadened toan additional group of six – Bulgaria, Latvia, Lithuania, Malta, Romania, Slovakia –plus Turkey, should that country make progress in meeting the human rights criteriafor membership. However, for the prospects of enlargement to be ‘real’ for the new-comers to the negotiations–which is a crucial part of the objective set out at Cologne–those newcomers would need to be able to catch up with the countries already partic-ipating in the process. By necessity, therefore, the Commission could no longer man-age the negotiations in block and would have to adopt a more flexible approach.

The implications of applying a principle of differentiation extend beyond therequirements for allowing late applicants to catch up in the negotiation process. By

364 Industrial Relations Journal Blackwell Publishers Ltd. 2001.

allowing countries to move quickly where they are most able or most willing, theprinciple also has the effect of front-loading the negotiations with early signs of pro-gress. In turn, this helps governments in the accession countries to rally supportbehind the prospect of membership and behind the necessity of making the painfuladjustments required to prepare for market competition or for approximation of theacquis communautaire. This is important not only for the newcomers to the negoti-ations, where the scale of adjustment is the greatest, but also for those accessioncountries like Poland which are showing increasing signs of popular fatigue withthe process (Szczerbiak 2001). In addition, governments in accession countries canuse early negotiation successes to fend off the encroachments of vested interests seek-ing to colonize parts of the policymaking process in order to fragment markets,encourage protectionism, or distort competition. Such private capture of states andmarkets constitutes a threat to political and economic stability of transition countries(Hellman, Jones, and Kaufmann, 2000). Indeed, evidence from Poland suggests thatit threatens to undermine the competitiveness of basic industry (Keat, 2000).Although a differentiated enlargement is not a guaranteed response to such politicaland economic risk, it appears to be the best response available (Cecchini, Jones, andLorentzen, 2001).

The success of the strategy can be measured in terms of the pace of the negoti-ations – which is to say, in terms of the number of negotiating chapters provisionallyclosed by applicant countries. During the first six months of 2000, the six new appli-cants closed an average of five chapters each, ranging from a low of four (Bulgaria)to a high of seven (Malta). Meanwhile, the six more advanced countries closedaround four chapters each, with Cyprus and Estonia closing five and Poland closingonly two. In contemporaneous terms, therefore, the newcomers are catching up. Themore advanced countries are also accelerating. The total number of chapters pro-visionally closed by the more advanced countries in the negotiations was greaterduring the first six months of 2000 than during any six month period since the startof negotiations. Based on this measure, therefore, the principle of differentiation canbe regarded as a success. Indeed, the June 2000 European Council at Feira regardedthe change in negotiation strategy with ‘satisfaction’ and concluded ‘that it shouldbe possible to open negotiations in all areas of the acquis with the most advancedof these candidates as early as possible in 2001’ (European Council 2000b: para-graph 12).

Whether the success of the negotiations translates into a successful enlargementremains to be seen. During 2000, there were a number of indications that the paceof negotiations was accelerating beyond the capacity of either existing or aspiringmembers states to adapt. Not only did public opinion within the European Unionfail to regard enlargement as a priority (European Commission 2000a), but also thedisturbing popularity of right-wing (or reactionary) political movements in Austriaand elsewhere signalled the magnitude of concern over who would pay for the costsof adjustment. In response to such concerns, the Commission responded with a pub-lic relations campaign which, in the words of Commission President Romano Prodi(2000), is intended to: ‘explain, explain, and explain to our citizens, that enlargementis not a threat, but a historic opportunity in all respects, and in the first place infavour of peace on our continent.’ Echoing Prodi’s statement, the European Com-missioner for enlargement, Gunter Verheugen (2000), declared that he is ‘absolutelyconvinced that without the prospect of European integration, the countries of Centraland Eastern Europe could not have managed the process of transformation so rapidlyor so successfully.’ The principle of differentiation not only makes it easier for poli-ticians to rally support for enlargement in the accession countries, it also makes itpossible for politicians to argue for the necessity of enlargement within the Euro-pean Union.

By the end of 2000, the European Commission moved to consolidate the principleof differentiation through a new strategy for enlargement. Rather than simply ‘avoid-ing cumbersome procedures’, this new strategy is designed around the requirementsof a flexible negotiation process. Using a combination of candidate ‘score cards’ and


‘regular reports’ as well as negotiation ‘road maps’, the Commission proposed tomove well into the substantive phase of accession (European Commission, 2000b).For its part, the General Affairs Council gave the strategy a broad acceptance, indicat-ing that: ‘it believes that all the necessary elements for continuing the accessionnegotiations and bringing them to a successful conclusion are in place . . .’ and that‘the principle of differentiation, based on each candidates country’s own merits, isthe cornerstone for the continuation and conclusion of the accession negotiations’(Council of Ministers, 2000b). Rather than attempting to ignore or work againstnational diversity, the new strategy for enlargement builds upon that diversity inorder to promote European unity.

Welfare state reform and the open method of coordination

The significance of enlargement as a paradigm for integration can be overblown.Although the principle of differentiation does achieve unity through diversity, theunity that is its objective is monolithic and conformist. Accession countries may charttheir own paths through the negotiation process, but ultimately all must accept andapproximate the full acquis communautaire in order to gain membership in the EU.By contrast, such conformism is not the objective of the European Union’s approachto welfare state reform.

The desire for welfare state reform grows to a large extent from the problemsof high unemployment and intense market competition. These problems have beenanalysed in Pierson, Forster, and Jones (1998, 1999) and Jones (2000b). At the Euro-pean level, the result has been the 1997 Luxembourg process for active labour marketpolicies; the 1998 Cardiff process for labour and product market liberalisation; andthe 1999 Cologne process for macroeconomic dialogue. Taken together, these pro-cesses suggest both a flurry of activity and an ambiguity of purpose. That the EU’sheads of state and government wanted to achieve better economic performance andgreater prosperity without sacrificing distributive equity or social cohesion wasundoubted. What these same heads of state and government meant by terms suchas better, prosperity, equity, or cohesion – or how these outcomes related to theprocesses – was less well understood. The individual processes – Luxembourg, Col-ogne, and Cardiff – each benefited from their own supporters as well as from favour-able early results (Goetschy, 2000). Nevertheless, the coherence of the European,Union’s macro-structural strategy as a whole remained open to question. As a resultthe Finnish presidency declined to contribute to the debate. While the Helsinki con-clusions allude to progress made on all fronts, the interpretation of this progress isdelegated to the Portuguese presidency:

The special meeting of the European Council in Lisbon on 23/24 March 2000 will provide anopportunity to further develop these issues by examining the objectives of the existing processesand instruments aimed at strengthening employment, economic reform and social cohesion in aknowledge-based economy (European Council, 1999: paragraph 3).

During the three months leading up to the Lisbon summit, the speculation was thatthe Portuguese Presidency would have little to add to the discussion (Coss, 2000).While the Commission mooted the possibility of setting precise targets for job cre-ation, and much of the rest of Europe focused on the development of a ‘knowledge-based economy’, the significance of the summit outcome remained in doubt(Harding, 2000). As it turned out, the Lisbon summit greatly exceeded these modestexpectations. Not only did the Presidency conclusions contain a number of concretemeasures aimed at fostering a knowledge-based economy, but they also provided ‘amore coherent and systematic approach [to] putting decisions into practice’ at theheart of which lay ‘a new open method of coordination’ (European Council, 2000a:paragraphs 35 and 37).

This open method of coordination relies on a straightforward hierarchy of Euro-pean guidelines, nationally-tailored benchmarks and indicators, national targets andmeasures, peer review, mutual learning, and shared best-practice. Indeed, at least


part of the initial popularity of the strategy should be attributed to the buzz-qualityof the language with which it is described in the Presidency conclusions. The lion’sshare of the credit for its widespread acceptance is the simple fact that the ‘methodis designed to help Member States to progressively develop their own policies’(European Council, 2000a: paragraph 37). The open method of coordination is welfarestate reform without the necessity of welfare state convergence or harmonisation. Ateach stage in the process, the potential for preserving and developing meaningfulnational diversity increases. Hence when the French attempted to introduce a moreconventional social program during their own presidency later in the year, they wereimmediately accused of violating the spirit of Lisbon (Shelley, 2000).

The point to note is that the Lisbon strategy builds on, and does not replace, thehost of processes that came before it. Despite Finnish (and wider) hesitation aboutthe development of European macro-structural policies to combat the jobs crisis, themultiplication of processes had the beneficial effect of generalising the objectives ofreform. Confronted with the need to change the basic structures of the welfare stateacross Europe, the architects of the Lisbon summit recognised that the unity that isdesired is broadly characteristic and procedural. As characteristic objectives, memberstates should be able to compete within Europe’s single market and they should beable to benefit from the stable macroeconomic framework provided by Europe’s sin-gle currency. Therefore, regulations or behaviour which are market distorting ormacro-economically unstable must be ruled out – as should any other structuralfactors which give rise to market distortions or macroeconomic instability. Moreover,the procedures for identifying inappropriate behaviour, regulations, or institutionswill be broadly the same for all member states. The procedures for diagnosing appro-priate remedies will be the same as well. Indeed, a crucial element in the strategy isthat all member states participate on the same basis and so both can learn from andsupport one-another through the reform process.

Nevertheless, within the boundaries of such conformity lies enormous scope fordiversity concerning the initial conditions of national welfare states, their develop-mental trajectories, and their final configurations. Whether intentional or not, thisscope for diversity reflects a growing conviction among ‘welfare-state’ scholars thatmarket forces have not induced a convergence in welfare state structures across coun-tries (Berger and Dore, 1996, Esping-Andersen, 1999, Ferrara and Rhodes, 2000,Scharpf, 2000). Thus while some gradual convergence may be a result, it need notbe. The existence of market competition does not imply a teleological imperative.The same scope for diversity also accommodates what Paul Pierson (1996) has lab-elled ‘the new politics of the welfare state’: distributive or entitlement structures aremore easily created than dismantled, if only because – once created – such structurestend to foster narrow, self-aware, and highly motivated constituencies willing to fightfor their preservation. In this way, the challenge of welfare state reform is similar tothe challenge of accession. Once again, however, the difference is that Europe’s mem-ber states have already approximated (much of) the acquis and so have no need toplace the emphasis of reform on achieving a conformist objective. Within the openmethod of coordination, the relationship between diversity and unity is even moresupportive – and open-ended – than under the principle of differentiation.

Pioneering and the procedure for enhanced cooperation1

Taken together, the principle of differentiation and the open method of coordinationmake it possible for a wider variety of states to join the EU and for the Union toaccommodate a wider variety of state structures. Nevertheless, the two principlestogether do not suggest how integration might progress. The Union may becomewider, but it will not necessarily become deeper. Indeed, it is likely that a wider and

1 This section draws heavily upon Philippart (2000, 2001) and Philippart and Ho (2000).


more diverse Union will find fewer strategic objectives for integration upon whichthe membership can agree.

This likelihood was recognised early in the year 2000 both by the European Com-mission and by the Portuguese Presidency. As a result, both proposed that the Euro-pean Union’s heads of state and government consider how to facilitate pioneeringefforts to deepen the integration process. The particular remedy they suggested layin the reform of the procedures for closer cooperation negotiated at the June 1997Amsterdam summit and adopted as Title VII of the revised Treaty on EuropeanUnion. If the whole of the membership is unlikely to agree on new areas of activity,then the most logical remedy is to enable sub-groups to experiment both in theirown interests and in the interest of the Union as a whole. The closer cooperationprocedures provide the vehicle for sub-groups of member states to move forward.Nevertheless, the procedures have not been used and there is considerable doubt asto whether they ever can be unless reformed.

The motivation for reforming Title VII is to shift the emphasis in closer cooperationfrom the development of a ‘hard core’ of integrating countries to the promotion ofintegration as a process more generally. The Amsterdam provisions insist that closercooperation ‘further the objectives of the Union’, that it take place ‘only . . . as a lastresort, where the objectives of the . . . Treaties could not be attained’, and that suchcooperation ‘[concern] at least a majority of Member States’ (Article 43, Section 1,indents A, C, D). In effect, the procedures are more useful for allowing countries tobow out of particular forms of cooperation than they are for encouraging groupsto experiment.

Because of this ‘hard core’ bias in the Amsterdam provisions, the level of safeguardavailable to pre-empt the procedure is necessarily high. Countries reluctant to seethemselves outside the hard core insisted upon the right to block any such activity.Hence, the initiation of closer cooperation is subject to an implicit requirement forunanimous support. Using a linguistic formula reminiscent of the Luxembourgcompromise, the Amsterdam Treaty stipulates that closer cooperation is permissibleso long as it ‘does not affect the competencies, rights, obligations and interests ofthose Member States which do not participate therein’ (Article 43, Section 1, indentF, emphasis added). The procedure does make it possible for closer cooperation totake place on the basis of qualified majority support in a number of cases. Neverthe-less, initial activation of closer cooperation relies on a preliminary assessment thatno member state’s interests will be affected. Here again, the emphasis is on self-exclusion rather than collective experimentation.

Finally, the Amsterdam procedures made no facility for closer cooperation in thearea of common foreign and security policy (CFSP). The explanation here is simplythat the provisions for CFSP outlined in Title V of the Amsterdam Treaty provide aseparate mechanism for member states to block or abstain from ‘common strategies’,‘joint actions’, ‘common positions’, or any other form of decision with which theytake exception (see Article 23). Given that the objective of Title V is expressly centredon the development of common positions, the explicit provisions of such a vehiclefor making exceptions is appropriate and any attempt to add to it through the pro-cedure for closer cooperation would have been redundant.

The change of emphasis from developing a hard core of integrating countries tothe promotion of integration more generally required a change in the nature ofcooperation. With this shift, not only did the balance of forces change from ‘optingout’ to ‘opting in’, but also the pattern of integration moved from one of concentriccircles to one of more variable geometry. This process of change started with theagreement at the June Feira Council to include the issue of closer cooperation withinthe larger agenda for European constitutional reform. After Feira, the question askedby the incoming French Presidency was both simple and potent: ‘Would it not bepossible to go further and stipulate that such cooperation constitutes a means ofintegration?’ (French European Council Presidency, 2000).

The negotiated answer is guardedly affirmative and it introduces fundamentalchanges in much of the restrictive language of the Treaty. Enhanced cooperation


should not only further the objectives of the Union, but also ‘[reinforce] its processof integration’ (Council of Ministers, 2000d: Section on ‘Enhanced Cooperation’,Clause A, indent A). It should take place as a last resort, but the new emphasis ison achieving ‘the objectives of such cooperation’ and not just the objectives of theTreaties per se (Clause B). The minimum participation – fixed at eight member states –should reflect a bare majority of a Union of 15 but will constitute less than a thirdof Union membership should the process of enlargement come to fruition (ClauseA, indent G). Enhanced cooperation should ‘not affect the competencies, rights andobligations of those Member States which do not participate therein’, but no mentionis made of member-state interests (Clause A, indent H). Finally, the procedures maybe extended to CFSP although they will not include those aspects of ‘security’ thatconstitute the core of Europe’s security and defence identity (ESDI) or that implicatethe resources required for national security and defence (Clauses I-K).

The effect of the new enhanced cooperation procedure is to make it easier for sub-groups of member states to combine aspects of the Community method – commoninstitutional framework, single body of rules – with the willingness to explore newforms of integration. Implicit in such facilitation is not only the recognition that anenlarged EU may lack momentum, but also the concern that countries recognising acommon problem will seek a common solution with or without the blessings of theCommunity or Union as a whole. Hence by embracing one form of diversity, theEuropean Union is able to avoid another. While admitting a greater variablegeometry centring on the institutions of the Union, enhanced cooperation preemptsthe proliferation of micro-institutional arrangements, each designed to resolve a spe-cific problem held in common by a specific group of countries. From this standpoint,unity through diversity not only provides the mechanism for progress, it also offersthe necessary antidote to fragmentation.

Putting it all together

The principle of differentiation, the open method of coordination, and the procedurefor enhanced cooperation are all different facets of a larger process of pursuing unitythrough diversity at the European level. The three principles are different, but theyare also complementary. Differentiation makes it possible for diverse countries tojoin the Union in a timely manner. Open coordination stimulates these countries totackle their own problems according to their own needs, but in a manner that cas-cades positive (and not negative) externalities from one reforming country to thenext. Enhanced cooperation facilitates the efforts of countries to experiment with newand different forms of integration while at the same time reinforcing the centralsignificance of the Community method and the Union’s institutions. In each case,diversity constitutes a strength for the Union.

The problem with diversityDiversity is not always a good thing. Indeed, it is worth reiterating that the traditionalunderstanding of the relationship between unity and diversity is dichotomous andoverlooks the prospect of unity through diversity. In the traditional view, some formsof diversity are irrelevant to integration. Others are inimical to it. Nowhere was thispotential for conflict between unity and diversity more evident during the year 2000,than in relations between Austria and the other member states of the Union.2 WhenAustrian Chancellor designate Wolfgang Schussel invited the far-right Freedom Party(FPO) to join his Austrian People’s Party (OVP) in the government, many Europeansconsidered that the acceptable boundaries of diversity had been breached. The FPOleader, Jorg Haider, was known to make unpalatable comments both about his coun-try’s National Socialist past and about its present immigrant population. Whether a

2 This account draws heavily on reporting in European Voice and daily newspapers.


sign of Haider’s opportunism or a signal of his sincere beliefs, such comments werebound to inflame racial intolerance both in Austria and across the continent. Worse,the symbolism that the FPO could be accepted as a party of government with orwithout Haider threatened to legitimate political activity on the extreme right incountries such as Belgium or France where politicians have long struggled to stampit out. The fact that such extreme right-wing parties tend to be anti-European as wellas xenophobic was only the icing on the cake.

The situation with Austria is a good example of the problem of diversity becauseit highlights the tension between the Community method, on the one hand, and thenetwork of bilateral relations between member states, on the other hand. Haider wasprincipally an Austrian and a European problem – not a bilateral one. No one seri-ously believed that either the FPO or Haider could bring the Nazis back to powerin Austria or even that they wanted to do so. On a bilateral basis, therefore, the FPOwas unpleasant but not dangerous. The same was not true within Austria or withinthe European Union. Forming an Austrian government without the FPO would bedifficult and managing the institutions of Europe without Austria would be almostimpossible. By the same token, allowing the FPO to have free say in how Austriaand Europe would be run was unacceptable. As a result, European action againstAustria took place only bilaterally and informally but with the objective of constrain-ing the FPO’s room for manoeuver both within Austria and within Europe.

From February to September, the European Union’s 14 other member states frozetheir diplomatic relations with Austria. They took this action outside the Communityframework and without recourse to the Treaties. In this way, they could both sanctionAustria and preserve the integrity of EU decision-making. This strategy was at besta limited success. While it did restrict Austrian influence – and, by extension, theinfluence of the FPO – it also began to raise concerns among the smaller memberstates as to where the limits of diversity might lie and whether these boundaries arethe same for all countries. In the end, the strategy collapsed as the pressure on EUdecision-making increased, as the popularity of the strategy among the smaller coun-tries evaporated, and as Austria threatened to hold a referendum on its relationswith the Union. The requirements of unity necessitated an acceptance of diversity,even when the differences at stake had tremendous symbolism.

The real force behind the Austrian crisis was not that the rest of Europe was sodifferent from Austria, but rather that different countries in the Union could identifywith the Austrian situation in a variety of uncomfortable ways. For those countriesmost eager to impose and maintain sanctions, the similarity lay in the real threatpresented by extremist parties on the domestic political scene. For those countriesmost enthusiastic to lift sanctions, the similarity lay in juxtaposed perceptions ofnational uniqueness and political vulnerability. In this way, the Austrian situationwas symptomatic and not idiosyncratic. The lesson to draw from Haider is not thatAustria’s political situation is somehow particularly precarious. Rather, it is thatdiversity remains problematic for the Union. Here again, the challenge for analysisis two-fold. First it is necessary to characterise those forms of diversity that are mostdamaging to the cause of integration. And second it is important to reflect thosecharacteristics back against the strategy of unity through diversity.

Differentiation and equality: The Intergovernmental Conference (IGC) onInstitutional Reform

The principle of difference that is most destructive to the cause of integration is wheredifference results in (or even correlates with) procedural inequality or inequality ofopportunity. Indeed, according to some conceptions of integration, the tensionbetween inequality and integration is axiomatic (Myrdal, 1956). Even outside suchtautologies, however, it is possible to find strong empirical support for the tensionbetween inequality and integration in Europe. During the year 2000, the bulk of thatevidence centres around the intergovernmental conference culminating at the NiceEuropean Council Summit in December.


Ostensibly the IGC had three problems to tackle in the service of a single objective.The three problems were: the weighting of votes accorded to member states in theCouncil of Ministers; the number of Commissioners in the European Commission;and the scope of qualified majority voting. These problems constitute the ‘Amster-dam leftovers’ in the sense that they were identified and yet left unaddressed duringthe 1997 Amsterdam European Council summit. Hence the IGC had intended torevisit these issues and a range of others – such as the distribution of seats in theEuropean Parliament – that are closely related. The objective of the IGC was to pre-pare the institutions and processes of the Union for the challenge of enlargement.The purpose of revisiting the Amsterdam leftovers and related issues was to preparethe Union for the challenge of serving a larger and more diverse membership thancould be accommodated without some sort of institutional reform.

As it turned out, the focus of attention was more on the problems than on theobjective. Despite the rhetoric surrounding the enlargement process and the clearsigns of progress made using the principle of differentiation, the emphasis of debatewithin the IGC lay on the relative positions of existing member states both vis-a-viseach other and in relation to the institutions of the Union. Hence the tendency(alluded to in the first paragraph of this essay) is to view the IGC as something ofa minimal success at best (Ludlow, 2001). The institutions were changed, and thechanges are likely to prove technically sufficient to carry the Union through theenlargement process. Nevertheless, the IGC failed to establish clear guidelines forequitable representation and so may be sowing conflict for the future.

The ambiguity surrounding the principles for equal treatment can be found bothin the headline Amsterdam left-overs and in the related issue of seat distributionsin the European Parliament. Indeed, if there is a single theme emerging from theIGC, it is power politics (Janning, 2000/2001). Consider, for example, voting in theCouncil. Germany wanted the largest share of votes as a reflection of the relativesize of its population. Meanwhile, France insisted on vote parity with Germany asa symbol of its equal status as a large-power. Worse, this dichotomy was not limitedto relations between Germany and France. Rather it reflected across member statesof all sizes. The only qualification is that conflicts tended to crystallise around clustersof countries with roughly equivalent populations, and parties on either side of acritical population size tended to align with whichever position would give them thelarger number of votes. The ambiguity arises from the observation that not all ofthese crystallised conflicts were resolved in the same manner. For example, Franceretained voting parity with Germany, but Belgium failed to maintain parity with theNetherlands. Thus even while the Treaty of Nice is explicit in establishing that aqualified majority must include a majority of the population, it provides no basisother than the successful application of guile or force for explaining how memberstate population sizes (or any other characteristic features) translate into votingweights.

A similar point can be made in reference to the recruitment of Commissioners fromthe member states. The question was whether each member state would nominate aCommissioner or whether and how some member states would find themselves with-out national representation. The presumption inherited from the treaty negotiationsat Amsterdam was that the larger member states would be willing to sacrifice oneof their two Commissioners but that they would be unlikely to sacrifice represen-tation on the Commission altogether. Hence before ‘the membership of the EuropeanUnion exceeds twenty’, the smaller states would stand to lose the certainty of havinga national representative on the Commission as part of ‘a comprehensive reviewof . . . the composition and functioning of the institutions.’3 Unsurprisingly, therefore,the smaller member states entered into the 2000 IGC determined to protect theirCommissioners by defending the principle that each member state should be rep-resented. Indeed, small state defence of the one-member-one-Commissioner principle

3 The citations are taken from the ‘Protocol on the Institutions with the Prospect of Enlargement ofthe European Union’ as appended to the Amsterdam Treaty.


continued despite a late concession by the larger member states that all countries –large and small – would participate equally in any rotation of Commission represen-tation.

The result was mixed: The principle of one-member-one Commissioner will beretained until the Union reaches 27 member states. Once the 27 member thresholdis breeched, the Council will have to take a unanimous decision on how many Com-missioners there will be and how they will be distributed. The only two provisosare the that the number of Commissioners ‘shall be less than the number of MemberStates’ and that the ‘rotation system [shall be] based on the principle of equality’(Council of Ministers 2000d: Protocol on the Enlargement of the European Union,Article 4, Section 2). That the system will be equal has been agreed. How such asystem will result in equal treatment – and indeed whether the Council will be ableto support one system unanimously – remains to be determined. Once again, theambiguity of the outcome lays seeds for conflict in the future.

Further examples of such ambiguity can be found in relation to the extension ofqualified majority voting. Why, for example, were only some issues extended to co-decision with the European Parliament while others were not? They can also befound in the distribution of seats in the European Parliament (EP). Why were pro-spective entrants equal in population to existing member states allocated fewer mem-bers of European Parliament? Indeed, differential treatment emerges as the principalindication of the limited nature of the IGC’s success. The question to ask, then, ishow the principle of differentiation can be such a boon in the enlargement negoti-ations while differential treatment is the hallmark of failure in the negotiations oninstitutional reform.

The principle of differentiation is important to the process of enlargement becausethe negotiations themselves are defined by exceptions. Where there is no exception –which is to say, where a country has no problem accepting the acquis communau-taire – there is also little or no reason to negotiate. If none of the accession countriespresented exceptions, there would be no need to differentiate between them. How-ever, where countries present exceptions, differentiation is useful in that the purposeof the negotiation is to determine the extent to which the exception can be accommo-dated to the benefit of the applicant. That said, the principle of differentiation breaksdown where exceptions are more likely to work to their detriment of the applicantsthan to their benefit. The incentive to accept differential treatment ceases to existonce the possible accommodations become more painful than an application of thegeneral rule.

If the objective is to map the limits to the principle of differentiation, then thefocus for attention should not be on what was negotiated, but rather on what wasnot. And the one major chapter of the acquis that remained unaddressed in 2000was the chapter on institutions. As that chapter is opened in 2001, it is almost sureto cause problems for the differentiated approach to enlargement as prospectiveentrants struggle to establish formula for equal participation that are most favourableto themselves. The idea of differentiated formulas for equality is a contradiction. Forthere to be equality, there can be but one formula – or one internally consistent setof principles – at work. Within this context, differentiation can be only eitherirrelevant or inimical.

Coordination and asymmetry: The economic governance of EMU

Inequality is not the only concern arising out of difference. Asymmetry is a problemas well. When two member states suffer different outcomes as a result of similardevelopments and despite their participation in a common institutional framework,then this asymmetry (or asymmetric vulnerability) is likely to work against the causeof integration. Whether rightly or wrongly, the disadvantaged members will workto change the rules while the advantaged members remain content to preserve them.The problem here is different from that of inequality. Just because two member statesare equal participants in the integration process does not mean they will fare the


same as a result. Where considerations of equality focus almost exclusively on theconstitution of rules, considerations of symmetry focus on outcomes and turn torules only once the outcomes are known. Moreover, where equality has an importantnormative dimension, symmetry need not. Just because one group of members wantsto change the rules in order to improve their outcomes does not mean they shouldbe allowed to do so. Arguments for equity may be invoked as a justification forchanging the rules, but that is no guarantee of success.

This problem of asymmetry is most easily illustrated within the context of Europe’seconomic and monetary union. The reason is that the literature and analysis sur-rounding EMU is rich with concern about the symmetry of effects from the processof monetary integration and from the operation of a common monetary policy. Sincethe initial discussions of forming a monetary union in the 1960s, economists andpolitical scientists have argued that the key to success will be the avoidance of asym-metry, whether in the form of shocks affecting only part of the monetary union orin the form of shocks affecting the whole of the union but with important differencesfrom one part to the next. That such concerns are often exaggerated should not betaken to mean that they are groundless (Jones, 2000a).

The shocks that hit the European Union in the year 2000 were symmetric in charac-ter but not in effect. The prolonged rise in the price of oil and decline in the value ofthe European single currency (the euro) were continental – even global – phenomena.Nevertheless, the impact of these events differed across member states dependingupon, for example:

� whether the particular country participates in EMU;� how dependent it is on imports of energy and exports outside the euro-zone;� how flexible its labour and product markets are as mechanisms for short-term

adjustment;� what were its initial level of unemployment and economic activity;� and so forth.

The range of potentially important factors is daunting. So too is the range of poten-tially important asymmetries. Differences can and did arise both bilaterally betweencountries or in aggregate terms between the performance of a particular country andthe performance of the monetary union as a whole. Bilaterally, as the French economyboomed during the year, the German economy languished (at least relatively) – andthat despite the favourable impact of the low euro-dollar exchange rate on Germanmanufacturing exports. In aggregate terms, the Irish economy raced ahead with adramatic rise in asset prices driving local inflation along with it. Meanwhile, theBritish pound vacillated between following the appreciation of the dollar and thedepreciation of the euro, alternately weakening the competitiveness of British manu-facturing exports to the Continent and raising the spectre of inflation.

That such differences emerged is hardly newsworthy. So long as Europe’s memberstates remain different in structural terms, they should be expected to react differ-ently to both external and internal shocks. How the member states respond to theemergence of such differences – and to the shocks behind them – is what matters.For those member states participating in EMU, the response was to strengthen themechanisms for macroeconomic coordination. For those member states outside thesingle currency, the response was to retreat into arguments about the importance ofmaintaining the autonomy of macroeconomic instruments as mechanisms for facilit-ating adjustment. Neither response was unambiguously ‘integrative’ in character andboth are potentially divisive.

The strengthening of macroeconomic coordination within EMU took place througha consolidation of the informal meetings between the economic and finance ministersof the 11 (and now 12) participating countries. During the run-up to EMU, it wasagreed that participating countries could meet informally before scheduled meetingsof Economic and Finance Ministers within the Council of Ministers (ECOFINCouncil). These informal meetings of the Euro-11 usually took place over lunch,centring on a limited agenda to be used as a basis for coordinating positions among


the EMU participants. With the prolonged fall in the dollar-value of the euro andthe concomitant rise in energy prices, however, the agenda for these meetings becamelonger and the process of coordination became more complicated. Hence, a numberof EMU-participants – led by France – began to agitate for a more structured coordi-nation process. At the ECOFIN Council meeting on 8 May 2000, the Euro-11 groupexpressed its determination ‘to speed up ongoing fiscal consolidation and structuralreforms’ as well as its ‘concern about the present level of the euro’ (Council of Minis-ters, 2000a). Soon thereafter, the French and Belgian governments declared that theywould work to strengthen coordination efforts within the Euro-11 group during theirupcoming European Council Presidencies (Jones, T. 2000a). In its statement of pri-orities, the incoming French presidency was explicit:

Drawing full benefit from the creation of the single currency also means strengthening the Euro11 Group . . . . [The] role of the Euro 11 should be enhanced, by further improving its operation,giving its proceedings greater visibility vis-a-vis the financial markets and heightening its politicalprofile in the outside world.4

Despite opposition from those countries not participating in EMU – and despite con-cern from a few EMU participants as well – the French presidency succeeded in itsbid to strengthen the Euro-11 group. Renamed the ‘Eurogroup’, the gathering ofeconomics and finance ministers from EMU member states rapidly began to assumea higher profile in European macroeconomic affairs. At the September informal ECO-FIN Council in Versailles, the Eurogroup even went so far as to issue a communiqueunder its own name – acknowledging the high price of petrol, admonishing memberstates to accelerate the process of structural reform, and decrying the low value ofthe euro against the dollar (Council of Ministers, 2000c).

The problem that such a strengthened Eurogroup poses is two-fold. On the onehand it provides a forum for debating the conduct of macroeconomic policy at theEuropean level – and one that might eventually come into conflict with the politicallyindependent European Central Bank (ECB). This possibility came into sharp reliefwhen French Finance Minister Laurent Fabius suggested before European Parliamentthat Eurogroup members might consider setting the inflation target for the ECBrather than allowing the European Central Bank to set targets for itself (Jones, T.,2000b). On the other hand, the Eurogroup threatens further to institutionalise thedistinction between those member states that participate in EMU and those that donot. Given that the non-participants are already having difficulty convincing theirelectorates to join the single currency, such a strengthened division is more likely toharden attitudes than to create incentives for membership.

Indeed, evidence suggests that such a hardening of attitudes has already takenplace. During the year 2000, the retreat toward macroeconomic autonomy in thosecountries outside the single currency developed not as a conscious strategy ofgovernment but rather as a belated reaction to growing popular concern. The failedreferendum in Denmark is only the most obvious example of the souring of thepublic mood. Despite a united political elite and a well-financed public relationscampaign, the Danish electorate voted overwhelmingly (53–47) to reject participationin the single currency. Concern that a similar referendum will deliver a similar out-come in the United Kingdom is rife, and explains to a large extent the vacillationand conflict within the Blair government over how best to approach monetary union.Here too the danger is that difference will provide the potential for future conflict.As Europe’s monetary union becomes increasingly important, and as countries out-side EMU begin to take exception to the consequences of movements in the externalvalue of the euro for their own economic performance, it is not inconceivable thatthe solidarity implicit in the open method of coordination will begin to wear thin.

Indeed, the difficulty presented by an open method of coordination is that it pre-serves the likelihood of asymmetry along with the distinctiveness of national insti-

4 The full text of priorities are available from the French European Council Presidency website:http://www.presidence-europe.fr. The citation is take from section 1.


tutional arrangements. The appropriate response is not to eliminate national diver-sity. Given the new politics of the welfare state, any such attempt would be doomedto failure. The crucial factor, then, is to limit the volatility of (and hence the shocksemanating from) economic relations both within Europe and between Europe andthe outside world. EMU goes a long way toward creating a zone of stability in Eur-ope. The single currency nevertheless remains vulnerable to fluctuations relative tothe outside world. That these fluctuations are less important to Europe as a wholethan they were to individual member states before EMU is irrelevant. That theyresult in or exacerbate asymmetric vulnerabilities is all that matters. So long as thesevulnerabilities exist, they will work against the goals of coordination as well as thestability of EMU and its ‘domestic’ macroeconomic environment. Here too differenceis at best irrelevant and at worst inimical to integration.

Cooperation and competition: The European Security and Defence Identity(ESDI) and NATO

A final principle limiting the pursuit of unity through diversity is the competitionfor resources. Where different forms of integration draw upon the same constrainedresource base, their co-existence is more likely to engender conflict than cooperation.The more ambiguous is the hierarchy of competing forms of integration, the moreintense the conflict is likely to become. A case in point is the dynamic relationshipbetween the North Atlantic Treaty Organization and Europe’s nascent security anddefence identity. And the forces for competition threaten to work against integrationin two ways, both by undermining the solidarity of NATO and by stifling the devel-opment of ESDI.

The European Union’s security objectives during the year 2000 were to wind upthe West European Union and transfer its functions into the Council of Ministers, tostrengthen the capacity of the Council of Ministers to conduct crisis managementoperations (both civilian and military), and to consolidate the development of ESDIthrough the explicit allocation of forces under European command. Moreover, insetting out these objectives, the European Council (1999: paragraphs 25–28) meetingat Helsinki in December 1999 was clear in its intention:

� to operate ‘in accordance with the principles of the United Nations Charter’;� to act ‘where NATO as a whole is not engaged’;� to ‘avoid unnecessary duplication’;� to provide ‘for full consultation, cooperation and transparency between the EU

and NATO’; and,� to ‘allow . . . non-EU European NATO members and other interested States to

contribute to EU military crisis management’.

With such language, Europe’s heads of state and government not only admitted tothe potential for conflict between ESDI and NATO, but also attempted to establisha clear hierarchy of organisational priorities: United Nations, NATO, ESDI.

This hierarchy continued through the June 2000 Feira European Council Summitand focused explicitly on the military resources that would be allocated to ESDI.At Feira, the European Council (2000b: paragraphs 7–8) agreed that ‘the necessarytransparency and dialogue between the Union and NATO will be ensured and NATOexpertise will be sought on capability goal requirements.’ The Council also insistedthat ‘principles for consultation with NATO on military issues and modalities fordeveloping EU-NATO relations have also been identified in four areas coveringsecurity issues, capability goals, the modalities for EU access to NATO assets, andthe definition of permanent consultation arrangements.’ With such strong qualifi-cations and reassurances in place, it should have been possible to develop ESDIwithout objections from NATO other member states.

Nevertheless, objections did arise across a range of issues related to the sharing ofresources between NATO and the EU. These objections related not only to the compe-tition for hard assets, such as troops, logistics, or intelligence gathering capabilities,


but also to a range of other less tangible elements such as secure communications,military secrets, and the like. The United States is most easily recognised as the sourceof objections concerning hard assets. After the 1999 Defence Capabilities Initiative,American military planners remained suspicious that Europe could constitute an‘own force’ without drawing down on NATO’s operational readiness (Jones 2000b:257). The problem is not one of redundancy but of multi-tasking. In constructing aforce of 60,000 troops to be made available for the implementation of a EuropeanSecurity and Defence Policy (ESDP), EU member states necessarily have to ‘assign’units already committed both to NATO and to their national security and defence.This ‘triple-hatting’ of forces raises the obvious question as to what NATO plannerscan do once European forces are already engaged elsewhere. Strong assertions of thehierarchy of institutional priorities matter little once forces are placed in activedeployment.

Objections over less tangible assets came not from the United States but from Tur-key. Frustrated with the lack of progress made in its bid to join the European Union,the Turkish government decided to use its membership of NATO – and therefore itscontrol over NATO resources – as a source of leverage (Winneker, 2000). This conflictdemonstrates that the competition for resources does not have to follow a pattern oflike-for-like. That Europe’s desire for ESDI is very different from Turkey’s desire tobe accepted in Europe is neither here nor there. What matters is simply that bothcan lay claim to the same restricted set of NATO resources in the service of theirseparate objectives.

Competition for resources was not limited to relations between the EU and NATO.Such competition also took place between EU institutions. Such competition aroseprimarily between the Council of Ministers and the European Commission. TheCouncil Secretary General and High Representative for Foreign and Security Policy,Javier Solana, is ostensibly the voice of the European Union to the outside world.Nevertheless, the Commissioner for External Relations, Chris Patten, controls vir-tually every lever for the conduct of a European foreign and security policy short ofmilitary intervention. While Solana provides an external face for the Union, Pattenmanages both the allocation of aid and technical assistance and the structure of econ-omic and trade relations. Therefore, while the two men have made great efforts toput on a public show of unity, it is little surprise that the institutions they representhave struggled to retain their exclusive competencies. For the Commission, thismeans placing the emphasis on connections between pre-CFSP external relations andthose in the present. According to Patten (2000): ‘the Commission has . . . animportant role to play – not, let me stress, carving out new responsibilities for itself,but exercising those it has already’. For the Council, the emphasis is on new oremerging responsibilities. As Solana (2000) explains:

The post of High Representative is not about creating a new power centre. Nor need it complicaterelations between the institutions. The post fills an institutional vacuum, and sets in motion poli-cies and activities in areas where the EU was previously either inactive, or irrelevant as an actor.

A further institutional competition exists between the Council of Ministers and theEuropean Commission, on the one hand, and the European Parliament (EP), on theother hand. Such competition operates both in regard to financial resources and withreferences to military secrets. The difficulty can be summarised as follows: The Euro-pean Parliament must authorise the release of financial resources relevant to theimplementation of CFSP. In exchange, the EP demands the right to oversee the con-duct of policy – and therefore also the right to access those classified materials uponwhich the policy is based. This conundrum came to the fore both when the Councilattempted to establish the principles upon which it could share military secrets withNATO and when the Commission sought authorisation to extend emergency creditsto Serbia in the aftermath of president Slobodan Milosevic’s ouster at the polls. Inthe first instance, members of European Parliament (MEPs) threatened to undertakelegal action in order to enforce their right to access sensitive materials. In the second,MEPs sought to place tight restrictions on the source of funds used to support Serbia


(and therefore the implications for other programs in the budget). How these specificcomplaints are resolved is less important than the likelihood that the European Par-liament will continue to contest the institutional basis for CFSP in the future.

The challenge of creating a European Security and Defence Identity goes beyondagreement on a common foreign and security policy whether in broad terms or morenarrowly focused on security and defence. ESDI is more than just an exploration ofsome new form of integration either on behalf of the whole of the European Unionor viewed as a subset of NATO membership. The pioneering of a European securityand defence identity necessarily entails commitments from both NATO and the EUas well as from those European countries that participate and those that do not. Itimplicates a wide range of at times very limited resources and it draws upon bothpre-existing and purpose-made institutional capacity. Hence while there may betremendous advantages to the development of an ESDI, there are also tremendousaccommodations which must be negotiated and enforced. And such accommodationswill require the commitment of a wide variety of actors, many of whom may notshare the priorities implicit in the creation of an ESDI and some of whom may – forreasons unrelated to European security or defence – be opposed to its creation. Inthis way, ESDI illustrates the general problems that face any form of enhancedcooperation. Far from demonstrating the virtues of unity through diversity, ESDIsuggests its limitations – with the prospect of competition for resources underscoringthe reality that diversity is not always a good thing.

ConclusionsInequality, asymmetry, and the competition for resources place tight constraints onthe relationship between unity and diversity. Where diversity leads to unequalopportunities, where it skews the distribution of costs and benefits, and where itencourages competing demands on the same resources, the prospects for integrationwill suffer. The solution is either to eliminate the diversity or to change the surround-ing environment in order to mitigate its impact on the process of integration. Putanother way, the conventional wisdom is broadly correct. There are times in whichunity can be pursued only at the expense of diversity or when diversity is at bestirrelevant. At such times, the pursuit of unity through diversity is likely to provedetrimental as well as unsuccessful.

At the end of the year 2000, the European Union engages all aspects of the relation-ship between unity and diversity: Unity against diversity; unity with diversity; andunity through diversity. The challenge for the future is to ensure an appropriate mixin the process. With respect to enlargement, this mix will require the EU to establishclear principles for procedural fairness in relations between member states and theUnion. With respect to welfare state reform, the Union will have to establish thecoherence of European objectives but – given that some diversity is inevitable – itwill also have to strengthen the capacity of European institution to insulate countriesfrom shocks that they can neither adjust to nor resist. Finally, with respect toenhanced cooperation, the Union will have to focus as much on the process of accom-modating new forms of integration as on the virtues of pioneering. The point to note,however, is that the fact that Europe is confronting these challenges is a clear signalof the progress that has been made during the year 2000. Unity through diversitymay not be a panacea, but it has been an important tack in the process of integration.

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