Modality and European Federalism

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Ontology is a branch of philosophy. It is the body of thought that studies the fundamentals of being, the persistent question of “what is” and concomitant topics. Ontologists tend to draw distinctions between a thing’s mere presence and the mode in which it is made manifest, so that it does not merely “exist” but it rather exists in some way.

We can intuitively appreciate this insight by examining a switch. The switch “exists” in two distinct states: on or off. While we interact with a single switch we intelligibly perceive of its presence as dual. This understanding of ours does not concern an object that is actually two, but only an object that has two modes of being. This is modality: the specific way in which some existence is made manifest.

I think modality is one of those important concepts one may employ to understand the nuance in the arguments among European federalists. To the uninitiated it is an oxymoron to purport to be a federalist while opposing proposals for the creation of a European political union of sorts. How come, for instance, the present author be against former Commission President Barroso’s notion of a “federation of nation states”? Isn’t such a political union a “federation” after all? And aren’t federalists supposed to be in favour of the “federation”?

The answer to these paradoxes lies in modality, more specifically in the modal differences between the various conceptions of a European political union that will succeed the present order of the European Union (EU) and/or the Economic and Monetary Union (EMU). While many views may qualify as “federalist” courtesy of their commitment to a multi-level, relatively decentralised polity, they do not share the same features, the same mode of being.

Quasi-confederal mode of governance

In the European Union we have a system that is at once inter-governmental and supra-national. As it currently stands we have the following non-exhaustive list of items:

  • demographics determine voting power in both legislative institutions, the European Parliament and the Council of the European Union, so that small states are in a position where they cannot form a [qualified] majority; this is more of a problem at the Council where Member States are represented;
  • capital key determines the voting power of states in the European Stability Mechanism, so that smaller states can never achieve a qualified majority for the approval of ESM funding;
  • capital key is also crucial to the European Central Bank’s operations, as also exhibited in its Expanded Asset Purchase Programme (Quantitative Easing) where asset purchases not covered by previous ECB operations are conducted in accordance with the “shares” of each Member State rather than their circumstantial needs;
  • the Eurogroup, a quasi-legal entity meant to coordinate the policies of Member States whose currency is the euro has no official voting procedures, no records of meetings, no live streams of its negotiations, no transparency etc. while the European Parliament has no power to exercise parliamentary scrutiny over it;
  • the European Commission, albeit the institution performing the EU’s executive function, receives its mandate from the top, the European Council, rather than from the bottom, the European body politic (which does not exist constitutionally);
  • because the entire edifice is founded on international treaties, no parliament, neither the European nor any national one has the power to conduct an ex post review of the legal basis of any given institution, or Treaty provision that substantiates secondary legislation, such as the articles in the Treaty on the Functioning of the European Union that underpin the rules on “economic governance” as codified in the Two-Pack and Six-Pack of Community regulations;
  • as parliaments lack substantial power on key issues, and because governments may not have the power to pursue policies that deviate from the legal requirements of the EU/EMU, the result is technocratic rule in various degrees of intensity.

[for the ESM and ECB capital keys, see Annex at the end of this article]

I have repeatedly described this architecture as quasi-confederal. By that, I mean to denote a political union that features a supra-national level—the federal level—which however is contingent on inter-state relations, hence confederation. Yet, since the EU is not a constitution-based confederation, which would be preferable to the status quo, but an inter-state-treaties-based order, it represents a sui generis entity that incorporates both confederal and inter-state modes of governance, without having the corresponding normative prerequisites of a common polity, in particular a European Demos as the clearly-identified subject of the constitutional order that is founded on a codified corpus of primary law.

Not all federations are created equal

Couched in these terms, let us examine French Economy Minister Emmanuel Macron’s views as expressed in an interview (in French) for the Süddeutsche Zeitung, such as his notion of our generation becoming the “refounders of Europe”, les refondateurs de l’Europe.

Mr. Macron’s heart may be in the right place, but his proposals do not seem to address any of the shortcomings of the existing order. He remains trapped in the mindset of gradualism, of proceeding with incremental Treaty amendments in an ever-expanding nexus of quasi-confederal arrangements.

Here is the key quote from his interview (translation and emphasis my own):

EN: The eurozone is in need of new institutions to which national governments will transfer more sovereignty: a strong European economic government, fitted with its own budget. […] For example, it could take care of necessary financial transfers towards a crisis-affected country or promote desirable reforms for avoiding divergence among our economies. The government of the euro would be led by a commissioner with extended powers. This would not be a Finance Minister of the euro, but someone who could allocate investment resources as well as talk about labour market policy.

FR: La zone euro a besoin de nouvelles institutions auxquelles les gouvernements nationaux transfèrent plus de souveraineté: un gouvernement économique européen fort, doté de son propre budget. […] Par exemple, il pourrait veiller aux transferts financiers nécessaires lorsqu’un pays est affecté par une crise ou promouvoir les réformes souhaitables pour éviter les divergences entre nos économies. Le gouvernement de l’euro serait conduit par un commissaire aux compétences étendues. Il ne serait pas qu’un ministre des finances de l’euro, mais quelqu’un qui peut également attribuer des moyens d’investissement ou parler de politique du marché du travail.

Mr. Macron’s proposals are not that different from what we currently have. If anything, they are the logical extension of it. In fact, his views are quite similar to the vision set out by the last Barroso Commission, in a November 2012 document (pdf) titled “A Blueprint for a deep and genuine economic and monetary union”. Ideas such a euro-specific Parliament, or rather a super-committee inside the existing European Parliament, were propounded in that text.

To be clear, Mr. Macron is speaking about “economic government”, which differs substantially from, say, democratically-elected government of a republic. An effective economic tsar at the Commission will have the power to rewrite budgets within the context of budgetary surveillance at the European Semester, exercise their extended powers to “promote” necessary reforms for tackling divergent tendencies, perhaps in the same way the troika “promotes” them, and provide financial support in exchange for effective economic hegemony (as is already the idea of the troika or the Commission’s notion of a troika-like “Convergence and Competitiveness Instrument”).

Mr. Macron may indeed be speaking about a “euro government” and a corresponding “euro parliament” of sorts, yet these potential structures will be incorporated in the existing quasi-confederal order by means of a new Treaty. Nowhere does the honourable Minister allude to a root-and-branch transformation of the EU or the EMU into a genuine constitution-based republic. There is no reference to any plan that will decisively disrupt the power balance in the various inter-governmental entities/fora, nor is there any mention to the creation of a European Demos qua constitutional subject.

Instead we will have “more Europe”, which translates into “more of the same” with enhanced powers for the technocrats and, eventually, for those Member States who have enough influence to manipulate them. Contrary to Mr. Macron’s rhetoric, we will not be the refounders of Europe but only its infamous apologists, those who will validate the present order and labour to further enhance and to calcify its most alienating aspects.

To speak my mind in honesty, I think this is the ideal of a Franco-German axis on steroids: an arrangement where some states act as the effective governing vanguard of an economy-first international alliance, while the rest provide the necessary milieu for economic growth and territorial security. Financial transfers will perform the function of existing EU money transfers, i.e. make the debasement of democratic life more palatable.

The republican modality

In contradistinction to the modalities of Mr. Macron’s actual supranationalism, we have ideas for transforming the EU/EMU into a true republic that will operate as a federation for practical purposes. Here is an outline view that is in no way “my own”:

  1. the polity will be founded on a primary corpus of law, a codified constitution that will be subject to review via parliamentary procedures (no more inter-state bargaining behind closed doors);
  2. the European Congress (federal parliament) will consist of two institutionally heterarchical chambers: in the lower house deputies will represent the citizens in their respective constituency, with demographic criteria determining the number of deputies each constituency may elect, while the upper house, the senate, will have a fixed number of elected representatives for each state (e.g. two for Malta, two for Germany); the Congress is therefore favouring larger countries at the lower house and smaller countries at the upper house, achieving a harmony of interests between place and space;
  3. the European Central Bank will finally become subject to democratic control, have its inflation target be determined on an annual basis by a European Chancellor of the Exchequer, a Minister of Finance, pursue a dual mandate for price stability and full employment with no priority given to either, and conduct asset purchases in accordance with area-wide cyclical requirements rather than capital subscription criteria;
  4. the European Stability Mechanism will be radically transformed into the European Treasury, controlled by the Chancellor, and will have the power to raise taxes, issue bonds, and mobilise resources for investments both for pivoting strategic longer-term plans as well as tackling cyclical or structural asymmetries;
  5. the European executive, a President, will be elected directly by the European Demos, and will have a democratic mandate that is in no way influenced by any other institution from above (as is the case with the European Commission that receives its mandate from the European Council).

This vision is about a federation, a European Democracy. What is different, indeed what needs to be accounted for, is the modal features of this potential polity as contrasted to those of other federations, such as the one envisaged by Mr. Macron, or Mr. Barroso’s “federation of nation states”.

Modality is the kind of concept that can help us penetrate the hermeneutic patina of various statements that all appear to be of the “federalist” type. By examining the specifics of the proposed theory of future integration, the “way” in which the new polity is supposed to exist, we may determine whether it conforms with democratic norms or further deviates from them.

To conclude, I have been trying to employ the term “European republican” in an effort to emphasise the importance of the “republic”. That is so, because “European federalist” is the kind of unqualified concept that can entail support for all sorts of federation regardless of their modal features. It is, in other words, the kind of language that can lead one to put form (federation) before substance (democracy).


Below are the capital keys of the ESM and the ECB. They represent the shares each Member State has in the entity in question.

Screen Shot 2015-07-14 at 10.48.19Taken from Annex II of the ESM Treaty (pdf). Decisions at the ESM require unanimity or in exceptional circumstances qualified majority of 85% of the votes cast.

Screen Shot 2015-09-02 at 09.10.25Taken from the ECB’s website about capital subscription.