Courtney Chiles

Overcoming the Challenges of EU Enlargement: A Transatlantic Solution
Intern: Transatlantic Community

December 3, 2010 Streit Council for a Union of Democracies

Overcoming the Challenges of EU Enlargement: A Transatlantic Solution Introduction Throughout its nearly sixty year history, the European Union (EU) has expanded and integrated more than any of its founders could have predicted. It has moved from its humble beginnings as a trade union involving only two commodities and six countries to a Union which encompasses twenty-seven countries and issues ranging far beyond economics. Still, there are barriers to further expansion and integration which currently hampers the global power and influence of the EU. Through examining the history of EU integration and expansion, we can see how the EU has changed over time, and the real limits that the EU is currently facing as it moves forward. Additionally, by looking at Charles Streit¶s ideas and proposals, we can determine how the EU can move past these limitations towards a Union of Democracies through closer economic partnership with the United States (US). In creating a deeper relationship with the United States in this area, both the EU and the US will see benefits. This can be seen through an examination of the history and current state of the transatlantic economic relationship, along with proposals for the future and the prospects for the success of these proposals. EU Expansion: History and Current Limits Since its inception in 1952 as the European Coal and Steel Community (ECSC), the EU has evolved throughout both the enlargement and integration processes. EU Expansion: History The ECSC began with a grouping of the six original countries, which included Belgium, the Federal Republic of Germany, France, Italy, Luxembourg, and the Netherlands, with the hopes of creating a partnership and union between states which had previously had a violent history. Proposed in 1950 by French foreign minister Robert Schuman to prevent further war between France and Germany, the ECSC centralized the previously nationally controlled coal and steel industries within the member states. This organization was a trade union established only for these two goods. By 1957, integration was deepened as the six members elected to sign the Treaties of Rome, which extended the cooperation of the ECSC, created a customs union under the European Economic Community (EEC), and established the European Atomic Energy Community (Euratom) for cooperation in developing nuclear energy. In 1967, these three organization were combined to form the European Community (EC). In 1973, the first enlargement of the EC took place. This enlargement included Denmark, Great Britain, and Ireland, all of which were fairly similar to the original six members economically, politically, and culturally. Norway had negotiated to join the EC at the same time, but Norwegian voters rejected membership in a national referendum. Accession into the EC was relatively easy for these three countries and the EC suffered few setbacks as a result of the enlargement.

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In 1979, the EC took a large step in becoming more democratic by holding the first direct, democratic elections for members to the European Parliament. Previously, members were appointed by national governments from their own parliaments. This move signaled that the EC was attempting to address the need for political and political integration. The second enlargement occurred during the 1980s. This enlargement, known as the ³Mediterranean enlargement,´ brought Greece into the EC in 1981, and Portugal and Spain in 1986. These three countries were all emerging from dictatorships and were much worse off than even the poorest of members in the EC. Inclusion of the states into the EC solidified their movement towards democratic government and principles and helped the states to develop economically. However, the differences between these three new members and the older members presented problems for the EC. Some, including France¶s François Mitterand, feared that the addition of these states that were not up to the EC standards at the time would revert the community to a free trade area, moving the bloc backwards. The EC decided that allowing these states to join the Community would solidify their movement toward democracy and strengthen their economies, thus making EC borders more secure. This decision marked the beginning of the back-and-forth debate within the Community between widening and deepening. The EC followed this enlargement with further integration. In 1985, the EC passed the Schengen Agreement. This led to the creation of open borders without passport controls, signifying the increasingly supranational nature of the EC and the powers that the national governments were willing to give up to create a more integrated Community. The following year, the Single European Act (SEA) was signed. The SEA set forth the goal of establishing a Single Market for EC members, with the hopes of implementing this by the end of 1992. Additionally, the SEA codified the policy of European Political Cooperation to bring political cooperation within the EC to par with the economic advances and cooperation the Community had made since inception. The ultimate goal of the SEA was to remove barriers and increase harmonization and competitiveness among member countries. With the fall of the Soviet Union in 1990, the EC faced the prospect of unifying East and West Germany. Additionally, there were several Soviet satellite countries in Central and Eastern Europe which required EC help in modernizing. Anticipating all of this, the EC went through another round of integration. In 1993, the Maastricht Treaty was formally passed, creating the European Union. This signified both a political and economic union. The previous incarnation had been more solely focused on economic integration, but now political integration would be given equal footing. The Union now included the three pillars: European Community, Judicial and Home Affairs, and Common Foreign and Security Policy. Additionally, Maastricht laid out the goal of a single currency for all members of the EU. The European Community pillar allowed for the continuation of the European Economic Community as part of the European Community. The Judicial and Home Affairs pillar extended cooperation between the member countries on issues such as law enforcement, criminal justice, asylum, immigration, and judicial cooperation in civil matters. The Common Foreign and Security Policy pillar was set up with the intent of continuing the coordination of foreign policy which had been in place since the 1970s with the introduction of European Political Cooperation. 1993 also marked the creation of the Copenhagen Criteria, which established a set of standards that those seeking EU membership would have to meet before being allowed to join. These included geographic criteria which held that any candidate state must be part of Europe. Additionally, adherence to democratic and liberal economic principles was required, along with the stipulation that all candidate states must harmonize domestic laws to those of the EU, or acquis communautaire. Maastricht faced a

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difficult ratification process: Danish voters rejected the Treaty, French voters only approved the Treaty by the slimmest margin, and the United Kingdom only barely passed the Treaty through Parliament. Denmark eventually passed the Treaty, but required that would exclude Denmark from certain parts of the Treaty. This began a period when it became increasingly difficult for the EU to push reforms through member states, which slowed the integration process. In 1995, additional members were added to the EU from the former European Free Trade Association (EFTA) states who had wished to remain neutral during the Cold War. These countries included Austria, Finland, and Sweden. These states had few difficulties in meeting the newly established Copenhagen Criteria as all had democratic governments and liberal free market economies in place prior to entering the Union. Following concerns that the Maastricht Treaty did not integrate the Union deep enough in preparation for the expected Central and Eastern European enlargement, an intergovernmental conference was held to discuss further deepening. What resulted from the conference was the Amsterdam Treaty, which entered into force in 1999. This treaty strengthened the Common Foreign and Security Policy and provided for institutional reforms granting more power to the European Parliament to make the Union more democratic as it adjusted to the new enlargement. The treaty further provided for a greater emphasis on citizenship and the rights of the individual, all of which had been concerns brought to the surface by inadequate coverage in the Maastricht Treaty. While the Amsterdam Treaty worked to allay some fears, it did not settle all questions raised within the EU on the ability of the institutions to function while properly representing the EU population effectively and democratically. In 2002, the eurozone was created, establishing a common monetary unit for most EU member states. Strict fiscal requirements were put in place, and only those member countries that could prove that they met high standards were allowed to be a part of the eurozone from the beginning. Others, like Great Britain, opted out of the eurozone, despite qualifying for inclusion. Other states continued to work towards the requirements set forth by the EU, and were eventually also added into the monetary union. Stipulations were put in place that required all new members to work towards eventual inclusion in the eurozone, meaning that any new states would not have the option of opting out of the common market. With concerns still raised about the ability of the EU to function effectively and democratically after the expected enlargement, EU leaders again met to amend the Maastricht Treaty. Many felt that the Amsterdam Treaty failed to address many of the vital topics that needed to be addressed before enlargement, and the Treaty of Nice was meant to once again reform the EU institutional structure in preparation for eastern enlargement. The Treaty of Nice encountered difficulties in passing when Irish voters rejected the Treaty in a referendum vote needed for ratification, shocking both Irish and EU leaders. Many Irish voters were critical of the contents of the Treaty, while others worried about the impact on Irish neutrality or wanted to send a message to EU leadership who they saw as arrogant and out of touch. Another referendum was held a year later with stipulations put in place to reassure Irish voters and the Treaty eventually passed, coming into force in 2003. The fourth enlargement occurred during the mid 2000s, with the accession of ten new member states from Central and Eastern Europe. In 2004, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia, and Slovenia joined the Union followed by Bulgaria and Romania in 2007. The accession process for these states was long and difficult, but the new enlargement process set forth by the EU was meant to help them. Many feared that the inclusion of so many underdeveloped countries would integration or would decrease the efficacy of the EU

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institutions. The EU worked to combat this as much as possible by laying out strict guidelines and action plans for these states to follow, with goals and timelines that the candidate states were expected to meet to qualify for membership. In 2004 and 2005, the European Union attempted to quell concerns about the growing intricacy and bureaucracy of the EU by drafting the Treaty establishing a Constitution for Europe (TCE), also known as the Constitutional Treaty. This Treaty was meant to consolidate all previous existing EU treaties in one document, while also giving legal force to the Charter of Fundamental Rights and expanding the realms of qualified majority voting (QMV) to include policy areas in which unanimity had previously been required. After being signed by all twentyfive members states and later ratified by eighteen members, the ratification process came to a halt after it was rejected in referendums held in both France and the Netherlands. The setback surprised many EU leaders and brought on a ³period of reflection´ in which the EU institutions reassessed the integration process. After this break from reform, the EU responded by scrapping the TCE altogether and coming up with a new treaty. This new treaty, referred to as the Reform Treaty until its signing in Lisbon, was meant to be an amendment to the previous EU treaties and incorporated many of the provisions set forth in the TCE. The Lisbon Treaty again faced difficulties in the ratification process as the Irish electorate initially rejected the Treaty, with many citing skepticism and general concerns with EU integration. The ³no´ vote was seen as an effort to preserve Ireland¶s national powers and identity. After addressing specific fears about taxation, neutrality, and certain social issues, the Irish approved the Lisbon Treaty in a second referendum the following year. With the passage and implementation of the Lisbon Treaty in 2009, the EU is now attempting to consolidate the foreign policy of the 27 member states into one. This signals a movement towards even further political integration as control over foreign policy is one of the most deeply guarded aspects of sovereignty within the EU. Overall, the Treaty is set to enhance the efficiency and democratic legitimacy of the Union while also improving the coherence of its actions. However, the success of these aims has yet to be seen. EU Expansion: Current Limits While it is true that the EU has grown and evolved more than anyone could have predicted at its inception a mere sixty years ago, there are certainly limits to how far the EU can both enlarge and integrate. EU enlargement is bound geographically by the Copenhagen Criteria, which explicitly states that candidate countries must be part of Europe. While the definition of where Europe ends is debatable, the EU is getting closer to figuring out where those boundaries are. In 1987, Morocco applied for membership in the EC and was rejected outright because it did not meet the geographic criteria of membership. It did not matter how similar Morocco was to the current EC members politically, economically, or socially or what Morocco could bring to the EC table. Similarly, the years of debate which went into deciding whether Turkey qualified for membership geographically (and culturally) signals that Europe is setting lines as to where expansion can end. Additionally, enlargement is constrained by EU willingness to accept new members. It is common after a period of enlargement that the Union will turn inwards, with most countries and the population of the EU suffering from ³enlargement fatigue.´ Some within the EU do not see the point of spending so much time and resources to bring new countries up to EU standards for membership when the current Union seems to be doing fine without the contributions of these

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candidate states. The cost in time and resources makes EU member states and citizens question the overall benefits of enlargement. Moreover, enlargement has so far been dictated by homogeneity. All the member states, though they do have differing histories and cultures to some extent, share common religious and continentally historic backgrounds. The prospect of the addition of Turkey provides a chance for the EU to become a more heterogeneous organization. Turkey, a predominantly Muslim country, does not share the same religious, cultural, or historical background as most of the EU member states do. This presents problems in finding common ground in debates or feeling that the same issues that are important to Turkey are similarly important to a country like France. Integration also faces certain real limits for the future. The most prevalent limit which the EU has had to deal with over the years is the balance between national sovereignty and the push towards creating a supranational body. Throughout the years, member states have feared the loss of national sovereignty as the EU has become more powerful. Greater economic integration has required more political coordination and integration to make the economic processes within the EU more effective. Certain issues, like the common currency and the supremacy of EU law, have required that member states cede power over certain areas which are commonly fiercely protected by the laws of sovereignty and guarded by states. There is a constant back-and-forth between the EU, which wants more power and wants to integrate further, and the member countries, who are worried about having to cede their power and control over critical issues. For instance, the recent struggle that the EU has had in implementing a common foreign and security policy illustrates this struggle, as the EU wishes to act with one voice on international issues, while each individual state wants to retain a degree of autonomy. These difficulties seem to indicate a discomfort within some EU member countries at the speed and depth of integration that the EU bureaucracy and leaders are pushing. Furthermore, integration is constrained by the differences between older and newer member states. While older member states are more developed and more able to integrate further, newer states are still struggling to develop. For instance, recent members like Bulgaria are still dealing with basic governance and economic reforms. Bulgaria has had problems with organized crime, corruption, and transparency. In 2008, the Commission went as far as suspending around ¼500 million in aid money, saying that the country needed to step up efforts to reduce corruption and organized crime. The European Commission has also created a Cooperation and Verification mechanism for Bulgaria and Romania because they felt that the two countries needed to do more in the areas of judicial reform, fighting corruption, and, for Bulgaria, combating organized crime. There is obviously a clear divide between the older and newer member states, with the newer, less stable member states slowing down the possibilities of deeper integration. There are several issues prominent within the EU which separates those more advanced countries from those still trying to catch up to older members. For instance, the eurozone only includes sixteen of the twenty-seven member states, leaving the remaining eleven on the outside looking in, with some desperately trying to catch up. Additionally, the Schengen area includes only twenty-two EU member states, leaving two who decided to opt out and three of the newest members outside the area. While these slower countries are working towards becoming part of the more deeply integrated eurozone and Schengen, uneven integration is slowing further unification and raises questions about the sensibility of bringing other struggling states like Turkey and the Balkans into the Union. The increasing number and heterogeneity of new and prospective member states promises to further derail the integration process. Seen from almost the beginning of the EU

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enlargement history, the addition of countries with varying histories and structures from current members slowed the integration process. With the inclusion of Greece, Portugal, and Spain in the European Community, the focus became those three countries and bringing them up to the political, economic, and social standards of the current members. All three states were emerging from dictatorships and were much worse off economically than any of the other members. The European Community had to devote countless time and resources to ensuring that reforms were made and committed to by each state. Additionally, with the inclusion of the Central and Eastern European states throughout the 1990s and early 2000s, the EU was forced to focus a great deal of time and effort on bringing those countries up to the standards set out by the Copenhagen Criteria. Moreover, as we can see today, some of these countries are still not on par with some of the original member states. Bulgaria, despite being granted membership, is still dealing with basic democratic principles of transparency and combating corruption, while Greece and, to a lesser extent, Spain and Portugal are dealing with financial issues to this day made increasingly worse by the recent global economic downturn. All of these issues have combined to create a debate and schism within the EU between those who advocate ³widening,´ or enlargement, and those who support a ³deepening,´ or further integration, of the Union. Countries, like Great Britain, who are more euroskeptic, push for the widening of Europe, adding more members in an effort to purposely dilute the integration of the EU. The greater the number of members, the less likely agreement and further integration is possible. Others, however, push for a deepening of EU integration. These states would rather see the EU build effective institutions so that the current members can integrate on a deeper level. However, this requires keeping a close eye on membership, only allowing new members in when they meet all the necessary criteria, which could be very steep, and could only happen if they would not dilute the integration achieved by the current group. As a result of these two factions, the EU has had to work to appease both sides throughout its history, lending to a cyclical process where enlargement and integration happen at two different times. However, the debate is difficult for the EU to deal with and constrains the efficacy and efficiency of both processes within the EU. One possible solution to this ever present debate could be a deeper cooperative relationship with the United States economically. Both the EU and the US would benefit from a deeper partnership as evidenced by the writings of Clarence Streit and the recent movements towards a deeper transatlantic relationship. A Deeper Transatlantic Economic Relationship While the European Union faces many obstacles in further enlargement and integration, the transatlantic relationship provides a forum for overcoming some of these obstacles. The most likely forum for deeper cooperation remains economic. However, there are also complications that would have to be overcome for this to happen. Link Between Economic Success and Enlargement Historically, EU enlargement and integration have been deeply based on economic successes or the drive to improve the economic possibilities for EU member states. Candidate states clamor to join the EU because of the vast economic benefits they receive through access to and participation in the EU market. Additionally, member states and citizens favor enlargement and integration much more when economic benefits can be linked to the addition of a new country or the passage of new community-wide laws. Studies have been conducted in which individual EU citizen support for integration has been linked to their economic perceptions, both
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individually and nationally.1 This can be seen throughout the history of the EU as well. For instance, the movement from a free trade area to a customs union was largely based on the economic benefits that members would receive by further integration. The requirement that deeper political cooperation would be inherent in this movement did not deter leaders from pursuing the action because they realized the economic benefits that would follow from the move. Similarly, institution of policies, like the Schengen area, which require a great deal of political cooperation and synchronization, are instituted because they provide vast economic benefits to those involved. Economic Deepening Economically, both the United States and the EU would significantly benefit from deeper relations. With over 800 million consumers between the United States and the EU, economic relations between the two are vitally important. The Office of the United States Trade Representative holds that two-way trade has been roughly equal over time and that the high levels of foreign investment between the two make the transatlantic economy one of the most integrated on earth.2 Still, progress can be made. In 2007, U.S. President George W. Bush, European Commission President Jose Manuel Barroso, and German Chancellor Angela Merkel signed the ³Framework for Advancing Transatlantic Economic Integration between the USA and the EU.´ This Framework provided for the creation of the Transatlantic Economic Council (TEC), which brings together the Members of the European Parliament and US Cabinet Members who are responsible for closer economic ties. It also marks a commitment from both sides to work towards eliminating regulatory burdens which hamper EU-US trade. Additionally, the Framework commits both sides to work towards transatlantic cooperation in the areas of intellectual property rights, investment, secure trade, financial markets, and innovation.3 In December of 2009, the European Commission issued a report which identified the largest Non-Tariff Measures (NTMs) that effect EU-US trade and estimated the economic impact that the elimination of these NTMs would have on both sides. The report found that for the EU, removing all NTMs would increase EU GDP by ¼122 billion ($156.5 billion) per year and exports by 2.1%. On the other side of the Atlantic, the United States could expect to see GDP increase by an estimated ¼41 billion ($52.6 billion) per year, with exports expected to increase by 6.1%. From this data, we can see that working to reduce NTMs between the EU and the US would benefit both sides financially while deepening transatlantic relations in the process.4 Although recent progress has been made, there are still other measures that can be taken, including setting up a free trade area between the EU and the US and parlaying that into a customs union in the future. Proposals for the creation of the Transatlantic Free Trade Area (TAFTA) have been discussed since the 1990s, with most recent talks occurring in 2007. The idea has been centered around creating a free trade area between the US and the EU and their
Gabel, Matthew and Guy D. Whitten, ³Economic Conditions, Economic Perceptions, and Public Support for European Integration,´ Political Behavior, 19 (1997): 81-96. 2 ³Europe,´ Office of the United States Trade Representative, http://www.ustr.gov/countries-regions/europe-middleeast/europe, (Accessed 17 Sept. 2010) 3 ³Framework for Advancing Transatlantic Economic Integration between the European Union and the United States of America,´ http://www.eurunion.org/partner/summit/summit20070430/transatlecointegratframew.pdf, April 2007 (Accessed 7 Sept. 2010). 4 European Commission Trade: United States, http://ec.europa.eu/trade/creating-opportunities/bilateralrelations/countries/united-states/, May 2010 (Accessed 3 Sept. 2010).
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related trade areas of the North American Free Trade Agreement (NAFTA) countries and European Free Trade Agreement (EFTA) countries included as well to counter the threat of the growing Chinese economy. In 2006, German Chancellor Angela Merkel stated that she found the idea ³fascinating´ and thought that it would be a ³packaging of common interests.´5 The benefits to both sides of a TAFTA agreement would be great. As Mirela Isic points out, the customs duties between the two partners are already the lowest in world trade, with industrial products only having a customs duty of 4%. Even if the higher customs duties on agricultural products were eliminated, their elimination would only produce a 0.3% increase in GDP for both regions. However, she states that ³Tafta would be a political symbol of a deepened economic relationship.´6 TAFTA would be a further incentive for the two areas to resolve their disputes, thus creating a deeper relationship overall and a better means to work together in the future. It would provide a forum, if not an incentive, for the two areas to resolve any disputes and misunderstandings the two have now or would have in the future, bringing trade disputes to an end and fostering better transatlantic relations in general. Another option for the EU and US to deepen economic integration would be creating a Transatlantic Customs Union. Similar to the TAFTA, this agreement would create free trade between the two regions and a unified policy towards trade with outside third parties. This idea would need to be tackled after the creation of the TAFTA, and would be a step towards even deeper integration. However, these prospects for a deeper transatlantic relationship face a few obstacles. First, EU and US regulations are fairly different and these would need to be reformed before any more economic deepening can occur. Regulatory barriers are one of the most significant barriers to transatlantic trade, according to the European Commission. 7 Although progress has been made in recent years towards the streamlining of regulations, there is still more work that needs to be done to deepen the transatlantic economic partnership. Subjects that have created the most tension in breaking down regulatory barriers include the deeply protectionist policies (on both sides of the Atlantic) towards domestic agricultural markets, along with the EU¶s fierce protection of food safety standards to regulate hormones, which the US does not regulate. Moreover, resistance on both sides to a deepening of economic relations presents a problem. Parties from both the EU and the US argue that transatlantic trade is already almost barrier free, and that little can or should be done to improve economic relations. These parties neglect to see the vast political and social benefits tied to a deepening of economic relations between the two economic powerhouses. How Deeper Transatlantic Economic Ties Can Bolster EU Enlargement There are several ways that deeper transatlantic economic ties can help spur further EU expansion and help the EU to overcome the widening versus deepening debate. First, it provides another incentive for candidate states as they make their way through the long accession process. Already the EU has strategic rewards placed throughout the accession process to encourage candidate countries to continue to pursue reforms and work
³Merkel for EU Agreement with US,´ Der Spiegel. http://www.spiegel.de/international/0,1518,440335,00.html, October 2006, (Accessed 17 September 2010). 6 Isic, Mirela, ³The Golden Opportunity - Is the Enlarged Europe Ready for the Transatlantic Free Trade Area,´ CAP Working Paper, Feb. 2007, 10. http://www.cap.lmu.de/download/2007/2007_eu-china_isic.pdf 7 ³EU-USA Regulatory Cooperation,´ European Commission: Enterprise and Industry, http://ec.europa.eu/enterprise/policies/international/cooperating-governments/usa/regulatorycooperation/index_en.htm, (Accessed 20 Sept. 2010) 9
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towards EU membership. These include Association Agreements, visa-free travel, and aid, among other things. With the introduction of deeper transatlantic economic ties, a further incentive could be added in to the mix. Privileged access to the transatlantic market or free trade area could be added as one of the incentives for progress towards membership. While access to the European market alone is highly sought after, access to a transatlantic market would be even more highly coveted among candidate states. Next, a deeper transatlantic economic partnership could lessen hesitancy within the EU towards expansion. While there are those that critique a ³multi-speed´ Europe, it could provide a needed push for EU expansion and integration, allowing for the EU to work towards overcoming the widening versus deepening debate. A deepening of economic relations across the Atlantic could provide a means for the EU to integrate candidate states in a two-round process, with economic integration taking place before political integration. While both the reforms for the economic and political sectors present difficulties for candidate states, a two tiered approach would allow for expansion to bolster economic ties--which the proponents of widening advocate--while simultaneously quelling fears of those that push for deepening. Allowing for an economic integration would enable the EU and candidate countries to create an economic partnership. Similar to the process used by the original members of the EU, a first-tier of membership would allow for the EU and candidate states to build a trusting relationship through trade, creating deeper economic interdependence. As political reforms usually take longer to embed in countries then economic reforms, this would be a way for the EU to reward countries for their progress while allowing for conditions for further integration within the political sector. This would give countries like Romania and Bulgaria, who are still dealing with numerous political reforms despite already gaining EU membership, more time to deal with political reforms without having to worry about being left out of EU political progress and falling even further behind other member states. Additionally, the EU could continue to integrate more deeply politically without concerns that some states will be unable to handle the requirements implicit in deeper integration. How Deeper Transatlantic Economic Ties Can Overcome the Limits of EU Enlargement As discussed earlier, there are several real limits to EU enlargement that the organization has been fighting for decades. However, deeper transatlantic economic ties could be a way for the EU to overcome these limits. First, the geographic limits placed on membership by the EU can be softened through deeper transatlantic economic relations. The creation of a TAFTA or TCU would provide another arena for the EU to expand without concerns over geographical boundaries. The TAFTA could be expanded to include neighboring states in Europe, Asia, Africa, and even Latin America, thus providing a forum for the EU to expand its influence while maintaining a deeper economic and political union throughout Europe without worrying about needing to extend membership past the continent. Additionally, the EU would not have to worry about extra states diluting progress made within the EU towards deeper integration economically, socially, or politically. Next, a deeper economic relationship across the Atlantic would allow for the EU to overcome enlargement skepticism from member states. Enlargement fatigue and the urge to concentrate on the inner workings of the EU could be overcome with help from the US. As potential EU member states would also greatly affect US economic interests, the US could be encouraged to help provide aid and support to those countries pursuing reforms to join the EU.

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In addition, the accession process for the EU could be made longer given the tiered system that could be implemented where candidate states first gain access to the TAFTA markets and then are integrated into the full economic and political system of the EU. This would provide assurances to those more skeptical states that the candidate states are fully prepared for the rigors and demands of EU membership. Thus far, EU enlargement has largely been dictated by homogeneity. However, deeper economic ties between the EU and the US could help to overcome this problem. Economic ties between the EU and US would provide the EU with another 300 million people, all fairly similar to the original western European member states. Additionally, the United States and Western Europe have a mostly shared history, culture, and belief system. However, the US also boasts a rather heterogeneous population as well, including a wide range of personal histories, cultures, and beliefs. These traits would make it easier for the EU to integrate countries with backgrounds less similar to that of Europe because the US would provide balance in the economic sector. Furthermore, candidate states with less in common with current EU members would have time to acclimate to the overall culture of the EU while EU member states would also have time to get used to the idea of incorporating these countries into the organization as members. Moreover, by creating common ties through economics first, candidate states can build a trusting and cooperative relationship with EU member states despite the lack of deep cultural, historical, or social ties. In this vein, the method is similar to that employed by the original six members of the ECSC, who built relations from practically nothing based on common economic interests. Balance between national sovereignty and creating an effective supranational body is another issue that deeper transatlantic economic relations could help to overcome. Creation of a TAFTA of TCU would not require member states to cede any further national powers to the larger supranational body because most of the powers regarding economic matters already lie with the EU. As such, there would be no further pull between national sovereignty and supranational powers because of deeper economic relations. Additionally, the creation of a TAFTA or TCU would allow for candidate states to take more time to institute reforms, providing for a more prepared state to join the EU economic and political system. As such, the EU would not have to worry as much about unprepared states diluting the political integration process or slowing down the movement and progress the EU has instituted. Differences between newer and older member states also present a problem for EU enlargement in the future. However, deeper transatlantic economic ties can help the EU overcome this. By creating a tiered system for membership, granting access to the TAFTA area before granting full EU membership allows candidate states more time to institute and maintain reforms necessary to bring newer states up to speed with the older member states. By providing an extra step and incentive along the way towards membership, the accession process can last a longer period of time without alienating domestic support for the EU along the way. This also allows the candidate states more time to institute the needed reforms required for accession while also giving the countries the much needed time to ensure that reforms being instituted remain strong and there is no backsliding along the way to accession. Thus, when the candidate states finally reach EU membership, they should be on par with the current member states and better able to meet the requirements of a full-fledged member state. Why EU Enlargement is Necessary Both sides of the Atlantic need the EU to continue pursuing expansion through increased membership and deeper integration.

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The EU needs enlargement because it gives the EU much greater political and economic powers on the world stage. More weight will be given to the EU in global affairs if it represents more states. For enlargement to be wholly effective, however, more integration is need as well. Integration ensures that the institutions of the EU are able to function effectively so that the EU can wield its increasing power on the world stage. Economically, the EU functions as one, making it one of the greatest economic entities in the world, but the EU needs the same capabilities if it expects to hold its own in foreign affairs. The fractured foreign policy can discredit the EU if different member countries act according to what they perceive to be their own national interests. With one unified and coherent voice, the EU could wield as much power politically as it does economically. Likewise, the US needs the EU to enlarge, and thus should also advocate for further integration. EU enlargement allows for the EU to have increasingly more power and sway over neighboring countries and other states around the world. An enlargement to include Turkey would provide the EU a direct link into the Middle East, allowing for greater sway in the region, which the EU could parlay into greater regional stability. The same is true for enlargement eastwards, creating a more stable relationship with Russia in the process. Additionally, with new member countries, the EU could potentially increase the European Neighborhood policy to encompass even more states, encouraging reforms along the way. This also helps to further greater inclusiveness between the West and ³the rest,´ as Europe moves towards forging greater bonds with countries in Eurasia, Africa, the Middle East, and Latin America. Greater regional stability and better relationships with a greater number of countries is desperately needed for both the US and EU, as increasingly developing states are banding together in the face of what they feel is the Western dominance. As Ronald Asmus argues, ³Americans have rightly concluded that it is in their national security interest to see the EU reach out to these countries which is why Washington is such an enthusiastic supporter of EU enlargement. Too few Americans, though, ask themselves what kind of EU will be able to manage this challenge and what they can do to help achieve this goal. The answer is that only a more politically cohesive, unified, and self-confident European Union is likely to be willing and able to continue to enlarge and anchor these countries to the West.´8 Overcoming the EU¶s Limits: Toward a Union of Democracies Clarence Streit and a Union of Democracies Clarence Streit, considered to be one of the foremost thinkers during the interwar period and writer of the book Union Now: A Proposal for an Atlantic Federal Union of the Free, provides some ideas for how the EU can overcome the inherent problems exposed by the widening versus deepening debate within the Union. Streit advocated for a union created through the integration of Western European democracies and other English-speaking, democratic states, including the United States, Canada, Australia, and South Africa. Streit presented a systemic doctrine of unification specifying institutions and steps that must be taken for unification to succeed. He argues that this union should form around a ³nucleus´ of countries. This nucleus would grow and eventually attract others to join, converting enemies into members as the nucleus expanded eastward. The hope was that the nucleus would be open for other countries to join along the way as they democratized, with the final goal being universality. The goal is for the union to have enough combined power to create an unbalance of power globally. This
Asmus, Ronald D., ³Rethinking the EU: Why Washington Needs to Support EU Integration,´ Survival, 47 (2005): 93 - 102.
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requires that the union be a predominant military power, to make clear that anti-democratic powers have no chance of winning a war, and a predominant economic power, with the ability to stabilize world finance and trade. Streit¶s vision hinged on the participation of the United States in such a Union. Additionally, the freedom, democracy, and economic might of the union would appeal to outsiders and would make them want to join the union, thus encouraging a movement towards democratic principles. The process of integration within this union is an important factor in Streit¶s argument as well. He argues that the original nucleus must be limited and homogeneous enough that a necessary level of integration can take place, allowing for the union to reach individual citizens. The main qualification for homogeneity for Streit involves whether the country is democratic. He strongly believes that only democracies can unite to make a union of this caliber work. He argues that: ³The value of a common language for the purposes of organizing interstate government has been over-rated, I think, and the value of common political principle underrated.´9 Streit¶s emphasis on the nucleus revolving around the United States and Western Europe also indicates that his definition of homogeneity further involves similarities in historical, religious, and cultural backgrounds as well as a history of cooperation. Streit notes that the culture of the nucleus countries is inextricably linked, stating that they ³[proceed] from the same basic Greek-Roman-Hebrew mixture grafted on the same dominant Teutonic-Celtic stock, the civilization of these democracies has reached broadly the same level.´10 The nucleus can build on these similarities to integrate further, thus paving the way for less homogeneous states to join a stable and fully integrated union later. Streit advocated for US involvement on the basis that it would bring a stabilizing factor to any union created. Economically, politically, and militarily, the United States would add incentives for other states to reform and join the union, while simultaneously balancing out any countries that wanted to join but did not have reforms all the way in place yet. Now, the EU is limited in its operations by the reforms that member states are going through. The EU is unable to integrate fully in areas such as the eurozone and Schengen areas because of the lack of progress in certain countries. This limits the depth of integration the EU can push for. With a large country like the United States added to the ranks, integration would be more feasible as the US could provide an anchor of sorts for the union. Additionally, the US would benefit from such cooperation. Streit, writing in the 1930s, points out that the United States has the most to lose economically, politically, and morally when crises strike, as demonstrated by the US being one of the hardest hit areas by the Great Depression (and, one could argue, by the recent economic downturn). The combination of the EU and the US in any sector would create a powerful entity, with the pairing able to better wield their power together rather than separately. Together, the EU and the US make up nearly 45% of the global GDP, 23% of the world trade in goods, and 30% of the world trade in services. Working in cooperation, the EU and US could use these dominating figures as a form of soft power to influence states, encouraging reforms and promoting the spread of democracy, while each benefiting from the partnership as well. Streit©s Ideas as Related to the Limits of the EU

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Streit, Charles Union Now: A Proposal for an Atlantic Federal Union of the Free, Postwar Edition (United States: Federal Union, 1976), 77. 10 Streit, 66. 13

In a way, Streit foresaw the struggles that the EU is currently facing regarding the widening versus deepening debate. In his argument that integration should be fully pursued before expansion, he noted the struggles that the union would potentially face if full integration was not achieved. The pull between enlargement and integration within the EU today is a result of the EU not concentrating first on integration and then on expansion. The tug of war between those countries that want to widen and those that want to deepen could have been avoided had the EU first concentrated on integration with the original six members. These states, already the stronger proponents of deepening would not have to worry about the views of later participants, like Great Britain, who primarily joined for economic reasons and not for the greater political cooperation that the original nucleus pushes for today. Additionally, Streit predicted the limits of solely European integration. His argument centered on transatlantic cooperation, with one of the seminal elements being US participation. His movement away from regional or language based unions was an attempt to create a universal entity of democratic states. Streit emphasizes that the undeniable attraction of the union would only work with the power and might of the United States added to its ranks. The combination of the United States and Western Europe was (and still is) sure to encourage reform towards democracy so access to the giant economic market of the union could be attained. Considering all this, the EU should focus on creating deeper transatlantic economic relations with the United States to overcome the limits of EU expansion. Deeper cooperation would not only be beneficial on both sides of the pond economically but one could also argue that it is needed on both sides of the Atlantic. Conclusion The EU and the US should focus on deepening economic cooperation. Doing so would further interests on both sides and would provide a way for the EU to overcome the widening versus deepening debate constantly raging within the EU. Both the EU and the US would benefit economically from deeper cooperation through a Transatlantic Free Trade Agreement, which could eventually be parlayed into an even deeper cooperation in a Transatlantic Customs Union. Despite the barriers to this, deeper cooperation economically would benefit both the EU and the US not only economically, but politically as well. Deeper economic relations would give both the EU and the US more weight in pursuing their individual political goals, including encouraging democratic, economic, and social reforms around the world, while also helping to bring more stability to the Middle East, Eastern Europe, and relations with Russia. While all of these areas and proposals face significant concerns and limitations, it is evident that cooperation between the EU and the US is beneficial to both parties. But, perhaps more important than the benefits that both will see from a deeper transatlantic relationship, are the very real needs for a better working relationship. With the changing global atmosphere, the US and the EU need each other if they expect to accomplish their stated goals in the international realm. The United States needs a deeper transatlantic relationship to attain legitimacy in its international policies while also countering the rising economic powers, like China. In turn, the EU needs the US to help lend greater weight to their foreign policy objectives as they strive to create a united voice on international issues. Additionally, both the United States and the EU need deeper EU integration and expansion because a stronger EU ultimately makes both parties more successful. The EU has made remarkable strides in its sixty-year existence and it is in the best interest of the United States to encourage and foster the continual deepening and widening of the

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EU. Through stronger economic cooperation with the US, the EU can overcome the inherent problems that it has faced throughout its history with the widening versus deepening debate. Furthermore, a deeper relationship can solve the very real problems faced by both sides of the Atlantic now and in the future.

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