Not a Europe of citizens: The EU on the road to military power

By Winfried Wolf

Winfried Wolf is a writer living in Berlin who for many years was an activist in the Trotskyist Fourth International. He was an independent member of the German parliament on the Party of Democratic Socialism list from 1997 to 2002. This article first appeared in Labour Focus on Eastern Europe.

Turnout in the European parliamentary elections of June 13, 2004, was 44.2 per cent. In Poland, the most important of the new EU members, the turnout was twenty per cent. The German daily Süddeutsche Zeitung delivered its verdict on the people even before the election: "In this election, the Citizens' Europe is carrying itself to the grave" (June 12, 2004). But one carries to the grave only what had once been alive, something that couldn't be said of Citizens' Europe either before or after the election. This was demonstrated a few days after the election in the battle over who was to succeed Romani Prodi. It didn't enter anyone's mind that the newly elected parliament should have anything to say about who should get the top EU job.

But the European Union is no small issue for the people of Europe. This is the single most important project since the creation of European nation-states in the nineteenth century and, from a German point of view, the most important development since the foundation of the German Empire in 1871. For some decades now, the nation-state framework has been too restrictive for the owners and top managers of the leading European corporations and banks. These gentlemen and (few) ladies look at their main competitor, the United States. US corporations and banks have access to a much greater domestic market that they can ring-fence and protect, and they can look for support to a much more powerful government that has the military capacity to capture and secure world markets. The task for European corporations and banks is to create a counterweight to the USA. The goal of these bosses and bureaucrats is not a citizens' Europe but a Europe of corporations and banks. The European Parliament, EU elections and an EU constitution are just a way of giving this project a democratic gloss.

Old goals in new clothes

The most important material goals of the European Union, such as the customs union, the common economic policy, the European Central Bank and the common currency, all consolidated in the new EU constitution agreed in June 2004, had already been formulated in an earlier epoch:

The unification of Europe … is an inevitable development. The incredible advances in technology, the shrinking of distances as a result of modern transport … and the trend of our time … make it essential for Europe to come closer together. Europe has become too small for feuding and restrictive sovereignties. The goal is a European customs union and a free European market, a strong regulation of currency exchanges and eventually a European currency union.

This was the draft of a memorandum, "Concerning the Creation of A European League of Nations", from the German Foreign Office, September 9, 1943.

The cleverest representatives of Nazi Germany and their allies among the bosses of the big German banks and corporations wanted, following a military victory in the second world war, to create a Europe, the economic foundations of which are similar to those that have been created today in the European Union. This doesn't put an equals sign between the politics of the Nazis and the politics of the EU or Berlin. It simply points to the fact that the material content, in particular the economic content, of both strategies is the same.

Germany's leading economic circles and the military failed in both wars to establish the Europe they wanted by military means. Following the second world war, they pursued this goal by peaceful means. Stations along this road were the Coal and Steel Community in 1950, EURATOM in 1956 and the European Economic Community (EEC) in 1957. Right from the beginning, this European cooperation had a military dimension. Already in 1952, driven by Paris and Bonn, the European Defence Union was created, an essential part of which was German rearmament. This was already seen, at the time, as a counterweight to NATO and trans-Atlantic military cooperation. The Defence Union was then blocked by the French parliament, still fearful of a militarised West Germany. The Defence Union was later replaced by the West European Union, which had a shadow existence right into the 1990s, at which time it was absorbed into the EU's own European Security and Defence Policy.

Franz Josef Strauss: `Why not us?'

Already at the time of the foundation of the EEC in 1957, political and economic cooperation between Paris and Bonn was decisive for the success of the European project. From a French point of view, in cooperating with the enemy of 1870-71, 1914-1918 and 1939-1945, there was hope for German support in the restructuring of the French economy. Following the war and occupation, the French economy was burdened even more by the colonial war in Indochina (until 1954), the war in Algeria (until 1956) and the loss of a large part of its colonial possessions. For France, the EEC was a second line of defence. The EEC treaty explicitly regulated France's relations with its "overseas countries and territories". In the language of EEC bureaucrats, France's colonies became "overseas territories". These regulations are still in force today. When the euro was introduced it was expressly stated that, in the French colonies and territories, in the so-called franc zone, the French government would be able to practise its own currency policy.

It is an interesting fact that for decades the European left did not recognise the significance of the "European project". There was only very occasional criticism. For instance, Franz Fanon, who supported the Algerian resistance, in his book The Wretched of the Earth, written in 1961, rejected the lies about a Europe of "democracy" and "human rights".

The French government, with the Paris-Bonn and later the Paris-Berlin axis, hoped to bind a reinvigorated West German economic power into the European Economic Community. The EEC would then, it was hoped, be dominated politically, militarily and culturally by France. From Bonn's point of view, the alliance with Paris would enable Germany to escape the isolation brought on it by the Nazi period. At the same time, the Paris-Bonn axis offered the opportunity to create a European economic bloc which, in the longer term, would challenge US hegemony.

In 1967, one of France's leading economic journalists, Jean-Jacques Servan-Schreiber, published a book titled The American Challenge. The EEC was seen by Servan-Schreiber as the European answer to the power of US corporations. In 1968, Franz Josef Strauss, at the time the leading German politician who defended an economically and militarily strengthened German imperialism, wrote the foreword to this book. According to Strauss, the EEC had already become "the frontline of American industry, the battlefield of its power". Strauss asked the question: "Why the Americans? Why not us?". Shortly afterwards, as finance minister in the Grand Coalition (1966-1969), he explained the basis of Franco-German cooperation: "The decision of Germany and France to reduce their dependence on the United States … allows us to begin the process of European unification. Both our countries should combine their resources, in all areas of modern advanced technology, for economic and military purposes."

EEC as competitive battleground

But this didn't happen. In spite of all the political gestures and efforts, what remained dominant at the economic level was the old competition between the banks and corporations. In addition, the gap between the big German and French businesses increased. I will return to this later. The European project was seen, from the respective national capitals, as a project to strengthen their own national economic power and to dominate "the rest of Europe".

This was exactly how the leading organisation of German industrialists, the BDI [Bundesverband der Deutschen Industrie—Federation of German Industry], saw the EEC in 1967: the EEC was to be "the sounding board for the pursuit of specifically West German interests". The European customs and free trade union created an expanded space for the competition between European corporations in the race to occupy leading positions in Europe and internationally.

As a rule, this aspect of competition and national "capitalist structures" is not adequately taken into account in the debate about globalisation. One begins from the abstract concept of "the power of the big corporations". If the "national colour" of corporate power is addressed at all, it is usually the US corporations that one has in mind. In fact, the EEC/EC/EU was seen for a long time as more of a technical than a power-political issue. And there were good historical and economic reasons for this. After all, the EEC was promoted by the US. President John Kennedy declared in 1961:

The Common Market ... should become our biggest and most profitable customer. Its consumer demand is growing steadily, especially for the goods that we produce best … It is a historic combination of necessity and possibility: at the same moment in which we need desperately to increase our exports, in order to protect our balance of payments and to pay our troops stationed abroad, there is emerging on the other side of the Atlantic a massive new market.

There were three main reasons for this us position. Firstly, the USA was by far the world market leader; the US share of the world market was sixteen per cent, the West German share seven per cent and the French share five per cent. The British share of the export market at the time was around ten per cent, but Britain was not a member of the EEC. Secondly, US corporations at that time played a major role inside Europe, sometimes a dominant role. In 1960, fifty per cent of cars produced in the world came from US factories, where all car producers were "national" corporations: General Motors, Ford, Chrysler and American Motors. Twenty-five per cent came from Europe, but around one-third of European car production came from US corporations situated in Europe: GM Europe (producers of Opel and Vauxhall), Ford Europe and the Chrysler company Simca. In 1960 around ten per cent of worldwide car production took place in Japan. Under these conditions, US corporations profited significantly from the expanding European domestic market.

New bloc competition

Thirdly, at the time of the above-quoted Kennedy speech, there was a common "higher" goal shared by all capitalist countries: the restoration of control over those territories which since 1917 (the Russian Revolution) and the end of the second world war (central and eastern Europe and China) had taken a non-capitalist route. As long as capitalism was united around this goal, then common institutions such as NATO or common policies such as trans-Atlantic cooperation were central. Inter-imperialist competition in this period was to some extent contained. But at the same time, in the context of this restrained competition, the relationship of forces was changing significantly. West European and Japanese corporations were conquering more terrain year on year and offering increasingly stiff competition to US corporations.

The "transition" of 1989-90 was also a transition in the dynamic of capitalism. It wasn't just that the one or the other social nicety came to an end. So also did the common interest of capital in a joint approach to the exploitation of the more than 1.5 billion-person labour market of the ussr, central and eastern Europe, China and Indochina. Inter-capitalist competition broke out into the open. In 1994 the USA and Canada joined in the North American Free Trade Agreement (NAFTA). Mexico was soon brought into this bloc. And now the USA is attempting to forge an even bigger bloc with Central and South America.

At around the same time, the Europeans signed the Maastricht Treaty. The European project, having stagnated for some decades, now began to move forward at an ambitious pace: the creation of a European Central Bank, fortification of the EU's external borders (the Schengen Agreement), the creation of an EU currency and expansion of the EU into central and eastern Europe. In 2004 all of these goals have been achieved.

The current inter-imperialist relationship of forces is marked by a crass contradiction. On the one hand, the leading EU country, Germany, was the leading world exporter in 2003, far ahead of the USA. The EU as a whole is far ahead of NAFTA in the world market. There are now very few branches in which the USA has the lead, as it does, for instance, in PC software with Microsoft. In 2004 (European) Airbus could move ahead of (US) Boeing in the important sector of civil aircraft production. On the other hand, the USA is by far the most powerful military force in the world. This was demonstrated in April 2004 with the "shock and awe" strategy, directed not just at the Iraqi military. The military offensive in Iraq was also a demonstration to the Russian, Chinese and European military. US spending on armaments is forty per cent of world spending and more than double what the EU countries as a whole spend.

Against this background, it is not accidental that at the core of the new EU constitution is the EU's Common Security and Defence Policy.

Economic and military hegemonies have always overlapped in the history of capitalism. Almost exactly a century ago there was a similar situation and a similar contradiction. At that time, at the beginning of the twentieth century, the USA overtook Britain as the number one economic power. But Britain remained militarily the strongest. After the first world war, this contradiction was resolved with the USA also moving into the top position. Now hegemony has again been divided between a militarily dominant USA and an economically dominant Europe under German leadership. This is an antagonistic contradiction that requires resolution.

European corporate power?

At the beginning of the 1990s, when the planned merger of KLM, SAS, Swissair and Austrian Airlines collapsed, the US business magazine Business Week pointed to an important weakness in the European economy: "A restructuring of European industry, carried out without regard for European nation-state borders, would be the final decisive step towards production units at a higher level. But this is a step that the Europeans obviously can't take."

And in fact, fifty years after the formation of a European economic bloc, there are very few "European" corporations and, apart from the arms and airline industry, no significant German-French corporations. There were some attempts in this direction, but they all failed. More precisely, what actually happens is a "fusion" in which the banner of the new concern remains, as a rule, national. NSU wanted to join up with Citroen; in reality, NSU was transformed into Audi and was owned by VW; Citroen was taken over by Peugeot. Hoesch (Germany) and Hogoovens (Netherlands) became Estel and failed. Today Hoesch is part of ThyssenKrupp; Hogoovens was taken over by British Steel. Osram was supposed to join up with the Dutch concern, Philipps; in reality, Osram was incorporated into Siemens, and Philipps took over Grundig. Renault and Volvo were supposed to merge with equality of both managements. In reality, Volvo was brought into the Ford empire and Renault took over Nissan. Beiersdorf was meant to join up with the French Oréal; however, the German side insisted that Nivea cream had to remain German.

In April this year (2004), when the German-French pharmaceutical concern, Aventis, was swallowed by the French Sanofi, the new boss, Jean-Francois Dehecq, made the classical statement that one hears now in one form or another in all mergers: "There is equality in the new board, but I'm the boss".

In short: Among the 200 biggest corporations in the world, seventy-six are US, forty are Japanese and sixty-eight are situated in the European Union. If we count Switzerland, then the number is seventy-four But these are not "European" corporations. Twenty-two of them are German, seventeen are French, ten are British, six are Dutch, six Italian, three Spanish, with one each from Sweden and Luxemburg. There are two British-Dutch firms, Unilever and Royal Dutch Shell, but their "bi-nationality" is not a product of the EU—they have grown together over almost 100 years.

Base and superstructure

This is a problem for EU strategists. Without a base, no superstructure. Without an economic base, without a European capital, the whole superstructure (the Commission, the constitution, the European Central Bank etc) can have no stability. Without genuine European corporations or domination by corporations based in a leading nation-state, the EU will always suffer from nation-state rivalries and, in times of crisis, could easily break up.

For almost half a century, this was not a central problem, as long as competition in the world market didn't intensify. Since the turn of 1989-90, however, we are again living in the new old world of classical ordinary capitalism. Competition is intensifying and the symptoms of crisis are more profound; militarisation proceeds apace. For corporations and banks in Europe, their only chance of surviving this battle, of withstanding the competition from US corporations, is bloc-building.

In such a situation, there are theoretically three ways in which European capital could develop. Firstly, the dominance of German banks and corporations could be expanded. Secondly, the Paris-Berlin axis could provide a strategic way forward, and German and French corporations could appropriate political and economic power in the EU for themselves. Thirdly, there is the path of militarisation and war: Europe is forged in the fire of wars.

The first path has been followed for many years. The weight of the German economy inside the EU has grown consistently in the last fifty years. EU expansion eastwards has been a major step in that same direction. German corporations have been able to build positions of strength in central and eastern Europe to a much greater extent than any other national group. In this venture, there has been a lot of cooperation between German and Austrian corporations and banks. The Austrians often act as a front for the Germans. The Germans assume that it will eventually come to a second and "peaceful" Anschluss: the Austrian economy has been controlled to a large extent by German capital for quite some time.

But this first path is a path along a tightrope. If German corporations and banks show their colours too aggressively, if they exercise their dominance in too brutal a manner, then they will provoke "the rest of Europe" into opposition. This was the background to the wrangle in 2000 about voting weight in EU institutions. Berlin was insisting that the Nice compromise be revised so that a greater German voting weight would make it possible for Germany, with a few allies, to win majorities that would serve German interests.

Tensions

The second option, based on Franco-German cooperation, has also been part of the "European project" for five decades. This path has had its high and low points. At the present time, the Paris-Berlin axis is in difficulty. Anyone wishing to understand current tensions between France and Germany should pay attention to the statement of French president Georges Pompidou in September 1971: "In the construction of Europe, Germany has a superior economic power, mainly because its industrial production is almost fifty per cent bigger than ours. Our primary goal, therefore, in the next ten years, has to be to double our own industrial capacity."

France not only failed to achieve this goal; in the past three decades the economic gap between Germany and France, especially between top German and French corporations, has widened significantly. In 1980 the combined Franco-German share of European GDP was 41.1 per cent and in 2000 it was at a similar level, 40.2 per cent. In 1980, the European Community had twelve members; in 2000 it was fifteen, following the addition of Austria, Finland and Sweden. In the larger EC/EU, the Franco-German weight remained stable.

But the specific weight of both elements in the Paris-Bonn/Berlin axis has shifted. In 1980, the French and German shares of the Community's GDP were roughly similar: Germany, 22.1 per cent; France, nineteen per cent. In 2000, Germany's share was twenty-four per cent, while France's share had shrunk to 16.5 per cent. In other words, the continued dominance of the German-French axis within the European Community has all to do with the increased weight of the German economy. The unification of Germany in 1990 was also undoubtedly a factor. But a quick glance at world trade also shows a similar picture. In 1980, France's share of world exports was six per cent, and it has declined since then, reaching less than five per cent in 2003. German exports in 2003 reached a record level of twelve per cent. Germany was now the world's greatest exporter. If we compare industrial production in both countries, then we find that the situation described by Pompidou in 1971 has not changed: German industrial production remains fifty per cent above that of France.

The current Franco-German debate is about the creation of "European champions". But here the comparison of French and German global players is an even more bitter one for France; in 2003, among the top twenty European industrial corporations, six were German, only three were French. And it was the top German corporations that also had the lead position in their particular branches. In car manufacture, for instance, DaimlerChrysler and VW were ahead of Peugeot and Renault. In the construction of power stations, Siemens had three times the turnover of Alstom. In steel, ThyssenKrupp is stronger than Arcelor. The banking and insurance sector gives a similar picture: Deutsche Bank is far ahead of France's number one, the BNP Paribas. Allianz is ahead of AXA.

If we exclude the arms industry, there are only three branches in which French industry has the lead position: in oil, where Total (previously TotalFinaElf) has no German equivalent; in rail technology, in which Alstom, especially with its TGV high speed trains and its tramcar "Citadis", is far ahead of Siemens; and in the pharmaceutical industry, where the new merged corporation, Sanofi-Aventis, has third place in world ranking, behind the US corporation Pfizer and the British GlaxoSmithKline and ahead of the German competition (Boehringer-Ingelheim, Bayer and Schering).

War as a `third way'

The only areas in which there is a functioning German-French cooperation are the airline industry, space and armaments. This is the third path towards making the EU into a closed bloc able to compete with the USA. It is also a way of demonstrating the "real sovereignty" of the EU. It has always been a function of a "proper" state to have the ability to wage its "own" wars and then to wage them. The present emancipation of Europe is nothing more that the creation of an EU war capability.

In the airline and armaments industry, we have sectors which, to a very great extent, are dependent on orders and subsidies from the state and are partly under direct state control. That's why Jacques Chirac and Gerhard Schröder were present, like two godparents, at the celebrations in the autumn of 1999 that launched the Franco-German-Spanish armaments venture, EADS.

The militarisation of the EU was given a new dynamism by the war against Yugoslavia. EADS is the core of a major military-industrial complex. The fact that EADS also controls two-thirds of Airbus indicates a symbiosis of the military and civil aircraft industries, something also true of Boeing in the USA. The only major armaments corporation outside the fold is BAE (British Aerospace Systems). But BAE gets more military orders from the Pentagon than it does from European governments. This is a boost to the kind of partnership that Tony Blair has entered into with George Bush in the Iraq war. The next EU-wide military mergers are already in the pipeline: in May 2004 there was an agreement to merge the three German firms involved in the manufacture of naval military craft (HDW in Kiel, Deutsche Nordseewerke in Emden and Blohm & Voss in Hamburg). This merger is part of a longer term plan to unite all German and French marine industrial capacity, a "marine EADS". Other mergers are being debated, for instance, in tank and engine manufacture (German MTU, French Snecma and Italian Fiat Avio).

Against this background, it is clear why the new EU constitution states:

Member States shall undertake progressively to improve their military capabilities. A European Armaments, Research and Military Capabilities Agency shall be established to identify operational requirements, to promote measures to satisfy those requirements, to contribute to identifying and, where appropriate, implementing any measure needed to strengthen the industrial and technological base of the defence sector, to participate in defining a European capabilities and armaments policy, and to assist the Council in evaluating the improvement of military capabilities. [Article 1.41.3]

It also helps to explain why the "Protocol on Permanent Structured Cooperation", agreed at the same time as the constitution, lays down the procedure for the creation of a military core:

The permanent structured cooperation referred to in Article I-40(6) of the Constitution shall be open to any Member State which undertakes, from the date of entry into force of the Treaty establishing a Constitution for Europe, to:

(a) proceed more intensively to develop its defence capacities through the development of its national contributions and participation where appropriate, in multinational forces, in the main European equipment programmes, and in the activity of the European agency in the field of defence capabilities development, research, acquisition and armaments ... and

(b) have the capacity to supply by 2007 at the latest, either at national level or as a component of multinational force groups, targeted combat units for the missions planned, structured at a tactical level as combat formations, with support elements including transport and logistics, capable of carrying out the tasks referred in Article III-210, within a period of 5 to 30 days …"

What is meant is clear: wage war.

The three options that I have described for achieving a new EU state are separate options only in a theoretical sense. In practice, all three paths will be taken simultaneously. What is frightening in this scenario is the fact that the path most likely to be successful is the third one, the armaments and war path. This was also the path that led to the creation of the German Empire in 1871. As in the case of the EEC/ec of 1957 to 1990, the pre-1871 Customs Union did not lead to the creation of a united German capital. It was Napoleon III's attack on Germany in 1870 and the subsequent Franco-Prussian war that led to the creation of the German Empire, announced by a victorious Bismarck from the Palace of Versailles. This, in turn, was the first step that led to German armament, imperialism and the first world war.

Lenin revisited

In an earlier debate on the theme of globalisation, one of the principal defenders of the globalisation thesis argued that an "ultra-imperialism" had been created: "The struggle of national capitals against each other will be replaced by the common exploitation of the world by a united finance capital". Against this, it was argued that national competition would continue, as would confrontation. Alliances between the imperialist powers, whether of one coalition against another or a "general alliance embracing all the imperialist powers are inevitably nothing more than a `truce' in periods between wars": "Peaceful alliances prepare the ground for wars, and in their turn grow out of wars; the one conditions the other, producing alternating forms of peaceful and non-peaceful struggle on one and the same basis of imperialist connections and relations within world economic and world politics".

This debate took place ninety years ago. The first quote is from Karl Kautsky, the second from Vladimir Lenin. We know from history that Lenin was right. There was to be no "ultra-imperialism" with its "united finance capital" that would organise a "common exploitation of the world". What happened was increased competition and military buildup leading to war.

The "civil" tendencies attributed by some to the EU today, distinguishing it from the more "aggressive US imperialism", simply don't exist. For some time now, the EU has gone down the road of stronger competition, rearmament and a preparation for military conflict. The forces driving this militarisation of the EU often have a better historical awareness than many on the left.

The Volkswagen corporation had a full-page ad in the Czech newspapers on March 15, 1999, with the heading, "The Big Spring Offensive". It was an ad for VW and also for the VW-owned Skoda. Many Czechs were reminded of the "big spring offensive" that had begun on exactly that day fifty years before, on March 15, 1939, when German troops established the so-called Protectorate of Bohemia and Moravia.