«The European social model and social market economy thus started to function together. This made room for a trans-partisan endorsement of both concepts»
When, back in 2014, I started my REScEU project, the online observatory EuVisions was to be the “operational arm”, so to speak, of our academic research. Its mission was threefold: 1) developing an agile and user friendly instrument for presenting the findings of our empirical investigations as well as of our conceptual and normative work; 2) serving as a forum for debates with colleagues and policy makers; 3) providing a testing ground for launching new ideas and practical proposals. Perhaps immodestly, I think that with the “ESU debate”, EuVisions has demonstrated a commendable capacity to fulfil its threefold mission and live up to its promises.
To be sure, the idea of a European Social Union did not germinate within Rescue. Its seed was planted in both the academic and the EU policy circles by Frank Vandenbroucke. Soon after the start of REScEU, Frank was kind enough to involve me in his own efforts to flesh out the ESU idea. Such efforts culminated with a collective volume published in 2018 (A European Social Union after the Crisis, edited by Frank Vandenbroucke, Catherine Barnard, Geert De Baere, Cambridge University Press, 2017). Participating to that book project gave me the opportunity of linking Frank’s insights with REScEU’s agenda and of channelling the congenial findings and thoughts of our research towards the ESU proposal and its further articulation. Needless to say, the adoption of the European Pillar of Social Rights (EPSR) in 2017 gave further spurs to our reflections, including that of promoting an “ESU debate” on EuVisions. Like Frank, I warmly thank all the contributors to this debate for their smart and thoughtful pieces. In this conclusion, I will try to distil a brief summary of the discussion, add a few further remarks of my own on “how to piece the ESU together” and express my hopes of advancement for the post-election new legislature.
Piecing ESU together: a summary of the debate
The financial and economic crisis has caused a general worsening of the social situation in all the Member States – a dramatic worsening in some of them. As highlighted in particular by Chiara Saraceno, socio-economic inequalities have witnessed a quantum leap in the last decade, disarticulating and polarising the very fabric of European societies. Dualisation within Member States has been accompanied by dualisation among the Member States, in the wake of a dangerous spiral of divergence between “core” and “peripheral” countries. Europe seems to have entered a treacherous epoch of double dualisation (as noted by Martin Heidenreich).
On this backdrop, all the contributors have welcomed the ESU proposal as a response to such predicament. They also share Frank’s and my own pragmatic approach: the best strategy is to start with the ingredients which are already available and to “piece them together” to form a Social Union. Among the various ingredients, the EPSR promises to be the most propitious “hook” in programmatic as well as legal terms. However significant, it would be a mistake, however, to overestimate the EPSR’s potential (Francesco Costamagna and Sacha Garben). For the time being, it is just an aspirational document, a set of “manifesto-rights” that need to be given substance and form, first of all by clearly identifying the possible institutional guarantors and the specific type of resource-guarantees which are needed for an actual fruition of the Pillar’s rights by EU citizens. As noted by Caroline De la Porte and Waltraud Schelkle, implementation will be key, as the devil always hides in details.
Emphasising the fact that we already have some pieces on the ground may itself turn out to be a double edged sword. On the one hand, the existence of a scattered “capital” of social policy spaces gives us the advantage of not having to start from zero, either institutionally or politically, and thus of possibly achieving some significant result already in the medium-term. On the other hand, relying on what is already available may triggering off a “wait and see” mood, feeding the expectation that the pieces of ESU will end up together sooner or later and thus that no overarching strategy is needed. This would be a big mistake. Good ideas must find purposeful “carriers”. Generalising an expression used in the UK in the early 2000s, the “stumbling” approach does not lead very far. Then, the expectation was that Blairs’s tax reforms would gradually stumble towards a good idea: the basic income. Almost 20 years on, this optimistic prediction has not materialised. So, if the ESU idea is good, why not outlining a pragmatic but clear strategy rather that counting on a random walk?
A strategy should start by setting reasonable and feasible priorities. On this front the contributors of our debate have expressed different views, already discussed by Vandenbroucke in his own conclusion. Bea Cantillon –supported by Saraceno and others – has suggested to prioritize minimum income protection; Matsaganis, Andor and others are more inclined towards prioritizing the protection of employment, especially those new forms of work linked to digitalisation. Both proposals share the same rationale: one should target the losers, the victims of dualisation dynamics. Since national systems still have a number of gaps and voids in this policy sector, EU action would be timely and useful, it could take a lead in orienting future developments and it could also avoid many of those obstacles typically linked to the institutional and political resistance inevitably exerted by already existing schemes. In his conclusion to the debate, Vandenbroucke sketches a bridge between Matsaganis’ focus and his argument and makes a third proposal, grounded on principle 12 of the EPSR and on the Commission’s proposal for a Council Recommendation (COM(2018) 132), aimed at ensuring access to social protection for all workers and the self-employed in the Member States. Prioritizing this goal would have at least two advantages. First, it would direct attention and policy efforts towards the historical and distinctive core of the European Social model: the social insurance of work-related risks. Second, such a priority would give to ESU the imprint of a multi-level “Insurance Union”, aimed at supporting the Member States and their citizens in “hard times”.
The term “Insurance Union” emphasizes in particular the problem of cross-territorial solidarity and thus points directly to the second side of dualisation, i.e. the increasing socio-economic divergence between Members States (not only North-South, but also East- West, as rightly noted by Bogoeski). Many contributors have focused their intervention on this aspect. According to Andor and Hemerijck the challenge of divergence cannot be tackled with a right–based approach only, but it requires a range of policies for promoting upward convergence and a certain degree of risk pooling. To this effect, what is needed is a shrewd combination of legislative, coordinative and budgetary instruments. Many have indicated the introduction of some form of EU unemployment insurance as the priority for the legislative agenda. Waltraud Schelkle and Andrew Watt have aptly recommended to deal also with the issue of tax competition, which bears great responsibility in undermining budgetary and economic stability at the national level. High attention should also be given to improving existing coordinative instruments. As regards the fight against poverty, Cantillon suggests a shift from the governance of outcome to the governance of inputs. Sebastiano Sabato and Francesco Corti formulate the boldest proposal: introducing a fully-fledged “excessive social imbalance” procedure, in the context of the Semester.
Many contributors argue in favour of a significant enhancement of the EU’s budgetary instruments, especially by introducing an autonomous fiscal capacity and smart rules for inducing public and especially social investments (Andor, Costamagna, Watt, Room). Watt and Room also recommend an extension of focus on policies and instruments apparently falling outside the remit of ESU, such as environmental sustainability and the so called just transition (possibly reconverting to this end agricultural spending).
Piecing the ESU together is not just a matter of outlining a substantive agenda, but also of forging supporting coalitions. As aptly pointed out by Trudi Knejn, there is a lot going on in civil society which is poorly known and even less exploited as a social base for building a more solidaristic EU. Local activist networks could be mobilized to serve as meso-level intermediaries between grass-root needs/demands and the macro-level of supranational institutions. More generally, a transversal reading of the various contributions signals preoccupation but also some optimism about the change of “moment”. Albeit slowly, and with a marked time lag in respect of problem pressures, a “socialisation” trend seems to be finally emerging in the midst of economic and fiscal “austerianism”.
The new “social moment” of EU politics: let us make the best of it
The results of the 2019 European election have been reassuring. In the aggregate, the right wing, populist and nationalist parties have performed much below their own expectations and some incautious predictions. In Italy, for months we heard threatening promises by the Cinque Stelle and the Lega Nord , according to whom “all will change in Brussel” after the elections. As it turns out, Ursula Von den Leyden will still be supported by the mainstream parties and the Cinque Stelle have even voted in her support. What is even more important, the President-elect has presented a political program which is possibly the most socially and environmentally friendly ever. As a recent focus on EuVisions explains, this time most parties have included detailed policy proposals in their electoral platforms. The parliamentary majority (as well as the Greens) will certainly exert a tighter substantial control and stimulus for the work of both Commission and Council. It is still too early to make predictions, but the “possibility space” for EU politics now includes a “social track” which was unthinkable only a few years ago. Continuity is important – as Vandenbrouke rightly argues. But pragmatism must be guided by visions. So it is important that we do not weaken our efforts at deepening and clarifying issues of principles and issues related to the broad strategy for ESU building.
Kindly connecting with my previous work on “opening” and “closure”, Martin Heidenreich has highlightened an interesting political development that might create the necessary preconditions for ESU-building in political arenas. I would summarise his reasoning by defining this development as the “defeat of exitism”. It seems awkward to use this term at the eve of “real” Brexit. But if we look at the discourse and platforms of the leading sovereignist leaders (Salvini, Le Pen, Wilders and others) the exit option no longer features as top priority. It is almost certain that such move is less the result of a “genuine” ideational conversion than of (un)feasibility considerations. Be as it may, the acceptance of the extant spatial boundaries of the EU (Eurozone) is likely to have important (and constructive, rather than destructive) “structuring” effects. If you cannot exit a given arena, you have to voice for promoting your interests in a logic of eventual compromise. It is a tenet of the Weber-Rokkan tradition to acknowledge that “bounded conflict” may well have a paradoxical integrative effect. In this light, ESU-building could indeed serve as a construction site capable of producing political and social bonding, in addition to its more visible functional benefits.
I like Vandenbroucke’s proposal of declining ESU as, essentially, an “Insurance Union” with a double mission: organising mutual risk-sharing; promoting common actions to create the conditions for domestic stabilization as well as sustaining social investments. Reaching a general programmatic consensus among the Member States on this blueprint and possibly implementing its first step, i.e. a European Unemployment Insurance of sorts, would already be a huge achievement. I only see two risks in this approach. The first is that the EU already has some spending policies and some dedicated funds (e.g. the Social Fund and the Fund for European Aid to the most deprived – FEAD) which do not rest on an insurance logic, but rather on the “active inclusion/cohesion” logic (for individual beneficiaries but also for national and regional governments, through various forms of conditionality). This logic should be protected and valorised with the ESU. The insurance principle complements and socialises competitive transactions, but is still based on rational expectations and actuarial calculations. Political communities require instead a modicum of unconditional solidarity – incorporated in their institutional structures – so that ordinary citizens can have an instinctual trust in the fairness of central authorities, whatever happens. This is crucial especially in those situations in which reciprocity-based calculations are instrumentally ambiguous, epistemically difficult or normatively untenable because of marked a-symmetric shocks or emergency situations.
The second risk that I see has to do with the key principle that Vandenbroucke prioritizes as being intrinsically related to the insurance notion: access to social protection for all. Principle 12 and the Council Recommendation for the moment speak of “all workers and the self-employed”, not “all citizens”. In the economy of the Pillar, this specification is not problematic, as risks and needs unrelated to work are dealt with in other parts of the Pillar, by other principles. It is true that, historically, social insurance was born around work-related risks through risk pooling techniques. But we must remember that in the historical federations (e.g. the US and Switzerland) the institutional separation between insurance (assigned to the federal level as regards work-related, inter-individual redistribution) and assistance (which remained in the jealous hands of sub-federal units, with very limited cross-state subsidization) prompted institutional and political tensions which have survived to this date. Since the EU already has “active inclusion/cohesion” policies at the supranational level, would it not be wise to capitalise on this, by formally and symbolically anchoring them within the ESU conception? With a view to attempting a political “leapfrogging” in respect of the experience of the historical federations? This is just a thought for the moment, which I offer as a topic for future discussions. Thus let me end this wonderful and exciting “ESU debate” with a Socratic invitation: there is still a lot to discuss, let us meet again soon.