Model for integration which has driven EU development

Date: 20/07/2000

By Simon Taylor

THE sight of Europe's once mighty coal and steel industries reduced to a waif-like shadow of their former selves might seem like a sign of failure of the European Coal and Steel Community.

Where once the mills of Europe rolled out more than 200 million tonnes of steel a year, the Union is now a niche producer with an annual output of only 63 million tonnes. Union coal mines now only supply 32% of the bloc's annual total coal needs of around 235 million tonnes.

But as the old heavy industries were forced to shrink in the face of competition from Asia, eastern Europe and South America, the real legacy of the European Coal and Steel Community (ECSC) is the model for European integration which it provided for the EU as it exists today.

Born out of the traumas of the Second World War, the Community was conceived by French civil servant Jean Monnet, not as a project for economic cooperation but as a political initiative to prevent France and Germany ever going into battle across the Rhine again.

By transferring control over the two industries essential for modern warfare out of national hands, the Community denied either side the ability to equip their militaries single-handedly and allayed French fears about German rearmament at a stroke. As French Foreign Minister Robert Schuman said at the ECSC's launch in 1950, its objective was "to make war not merely unthinkable, but materially unwinnable".

As European scholars William Nicoll and Trevor Salmon note in their book Understanding the European Communities, the ECSC treaty has "little to say about coal and steel". Instead, it "speaks of safeguarding world peace" and of "substituting for age-old rivalries and blood conflicts the merging of the essential interests".

Starting work in 1952 with six members (France, Germany, Italy, Belgium, the Netherlands and Luxembourg). the ECSC had surprisingly wide-ranging powers over investments by companies, state aids, production levels and selling prices.

By combining the markets of the member countries and presiding over a time of economic growth in a Europe hurrying to rebuild after the devastation of the war, the ECSC witnessed an enormous increase in industrial production. Steel output rose from 92 million tonnes in 1962 to 156 million tonnes in 1974. But trouble struck in the Seventies with the oil crisis which caused a world-wide slump in demand for steel.

But still production continued to climb, reaching 200 million tonnes in 1980. Over the next decade, prices slumped despite modest efforts to scale back production, forcing the European Commission to declare a state of "manifest crisis", imposing quotas on 80% of production.

The crisis was only declared officially over in 1988 after major industry restructuring efforts involving more than 152,000 job losses and nearly €40 billion in spending to soften the social impact of plant closures.

While the ECSC had overseen a period of industrial decline, its major contribution to the development of post-war Europe was to provide a model for European integration which still exists today. First, the Community created many of the distinguishing features of the present-day Union. It had a High Authority, which later became the European Commission, a civil service with the sole right to propose new laws, an assembly to debate legislation, a Court of Justice to rule on disputes between member states, and a Council of Ministers to represent national governments and vote on laws.

The Community also gave rise to what has become known among students of European political science as the 'Monnet', or spill-over method of European integration. The success of the ECSC led the six founding members to pool sovereignty in other areas of political and economic cooperation, resulting in the creation of the European Economic Community, launched by the Treaty of Rome in 1957.

This method has been credited with providing the internal dynamic which resulted in the Union moving from being merely a common customs zone to a single market and culminating in a single currency.

Recently, the 'Monnet' method has been in the news again after German Foreign Minister Joschka Fischer said it had reached the limits of its usefulness. He called for a core group of countries to push ahead with plans for a European federation. Otherwise, he warned, the Union faced "a loss of European identity, internal coherence and internal erosion of the EU".

Yet the lukewarm reaction to Fischer's speech across the Union suggests that Europe's first integration project may continue to serve as the best model for member states to integrate for some time to come.

The sight of Europe's once mighty coal and steel industries reduced to a waif-like shadow of their former selves might seem like a sign of failure of the European Coal and Steel Community. But as the old heavy industries were forced to shrink in the face of competition from Asia, eastern Europe and South America, the real legacy of the ECSC is the model for European integration which it provided for the EU as it exists today.