The Europe Dilemma: Britain and the Challenges of EU Integration by Roger Liddle

Author:Roger Liddle [Liddle, Roger]
Language: eng
Format: epub
Tags: International Relations, Public Policy, European, Europe, Political Science, Reference, World, History, General
ISBN: 9781780762234
Google: 89OLDwAAQBAJ
Goodreads: 18927041
Publisher: I. B. Tauris
Published: 2014-03-27T00:00:00+00:00

The Lisbon Balance Sheet

It is now commonplace to dismiss the Lisbon strategy as an outright failure. Clearly it did not deliver its headline ambition: the EU did not become ‘the most dynamic and socially inclusive economy in world by 2010’. Indeed the hype of that phrase now sounds ludicrous. The headline gap in output per head with the USA is still significant. The emerging economies are catching up with Europe at amazing speed, though the ‘rise of the rest’ and the ‘decline of the West’ is in terms of overall human welfare to be welcomed, not feared, as long as that decline is relative not absolute. Perhaps more seriously the outlook for future growth in Europe remains extremely problematic. In 2010, at the endpoint of the Lisbon strategy decade, the euro area was on the threshold of a grave and potentially existential sovereign debt crisis. Britain had seen the largest drop in output since the early 1920s and was about to enter its slowest ever period of recovery from recession. The European social model still had to face the twin long-term challenges of demography and global competitiveness, but from a much weaker position than the Lisbon strategy had envisaged.

Yet the Lisbon strategy had many strengths in its conception and some notable successes in its delivery. Lisbon was widely seen as a classic exercise in ‘third way’ triangulation. It contained a strong commitment to fiscal discipline combined with the need for structural reform and greater market flexibility. Some argue it bought into much, perhaps too much, of the market liberal agenda. Yet it had a distinctively social democratic stamp, not surprising in that 11 of the EU 15’s heads of government came from the centre-left when Lisbon was launched. Its essence was an ‘active government’ agenda to improve supply-side performance, increase knowledge investment, raise labour market activation and tackle social exclusion. Its thrust was not sub-Thatcherite.

The unstated agenda was moving Europe towards the best of the governing principles of the reformed Nordic model, which since the mid-1990s had been uniquely successful in combining the goals of equity and efficiency, as André Sapir later argued.3 Nor was the reformed Nordic model as statist and collectivist as many of its overseas admirers on the left believed. As Karl Aiginger explained, its success was built on an endorsement of an open competitive economy, a vibrant private sector and fiscal discipline as the essential framework for economic growth. The Nordics had, however, mastered how to use the power of an efficient state to enhance growth potential. During Sweden’s tough but successful fiscal consolidation in the 1990s, public investment in knowledge – research, higher education and lifelong learning – had been increased, helping to sustain the country on a strong growth path. The Nordic countries generally boasted a flexible labour market that protected people not jobs. Employers faced few barriers to redundancy: active labour market policies retrained the unemployed and reconnected them with jobs. Families could rely on a strong universalist welfare state: this did require

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