The democratic legitimacy of EU institutions
In the future developments of the European integration process the question of the EU’s so-called ‘democratic deficit’ is likely to surface. It is important to observe that the term ‘democracy’ is compatible with a wide range of possible definitions.
This indeterminacy enables us to look at this issue from several vantage points.The most popular appraisal of the democratic deficit undermining the EU integration process argues against EU institutional organization by observing that only the EP has direct accountability to the voters in the national constituencies. The procedural weakness of the decision process originates in the fact that hitherto, two non-elected bodies (the Commission and the Council) have been responsible for a great part of the legislation process. The lack of democratic legitimacy of the market-building process and realization of the four liberties upheld by the ECJ, and the lack of accountability of the ECB, have also been criticized. According to the view of perfect substitutability between the market and the voting mechanisms, a Commission concentrating its efforts towards the completion of the single market, and an ECB committed solely to monetary stability, aim at ‘levelling the playing field’ for the deployment of competitive forces, and are considered to confer democratic legitimacy on the marketplace. This view can be questioned by arguing that democracy should not be narrowly identified with voting. Many members of democratic institutions, who are appointed rather than elected, derive their democratic legitimacy indirectly through another elected institution that is responsible for appointing them. Just as the Commission’s president and members are nominated by the intergovernmental method and approved by the EP, in many European countries there is no constitutional obligation for the government to be composed of elected representatives only.
Although from the EU perspective the Council’s decisions can be considered barely accountable, nevertheless the Council indirectly derives its democratic legitimacy from the accountability of its representatives at the national level.However, another problem arises with the increased use of majority voting in the Council, whereby an entire country may be outvoted and bound to comply with the very same legislation it opposed. In such cases, the democratic deficit is strictly interwoven with the intergovernmental method and makes accountability impossible within the Council, while the same problem does not affect the democratic substance of the EP decision making which abides by the supranational method. The democratic control about how the representatives in the EP interpret their mandate is validated by voting in the national constituencies. On more general grounds, the democratic accountability of an institution-building process with no federal state yet in place is quite different from the democratic accountability within a nation-state. A related question is the accountability of the quasi-jurisdictional bodies. The practice of empowering independent institutions to represent groups of interest is increasingly popular in the EU decisional process. The recognition of political accountability to agency-type regulation has been defended on the questionable grounds that the EU is just a regulatory state (Majone, 1996).
Another, less discussed, aspect of the democratic deficit is economic democracy. A higher level of social cohesion in the EU should be pursued through the improvement of the well-being of ‘disadvantaged individuals’ (the unskilled, the poor, immigrants, the disabled and so on). Public policy oriented to equality of opportunity could play an important role in fostering economic democracy with positive fall-out on the quality of the public discourse. The record of EU integration on social policy is not outstanding.
The market-building process of negative integration through the abatement of tariff and non-tariff barriers to trade has scarcely been complemented by the market-correcting process of positive integration (Scharpf, 1999).
This view stems from two structural changes which are soon to be implemented: (i) after the liberalization of the national markets promoted competition inside the integrated market, the stringency of anti-inflationary monetary policies, the loss of the devaluation instrument after the passage to the EMU, and the anti-state-aid legislation have reduced the financial capacity of the national states to set up fiscal stabilization policies, to provide financial support to the national strategic companies, and to devise education programmes dedicated to improving human capital; and (ii) fiscal competition might also put pressure on the national systems of social security and health care. In contrast to market competition, where the exit of non-competitive firms strengthens the functioning of the market, a competitive tendency across fiscal systems may weaken social cohesion by provoking a welfare system squeeze. In order to avoid capital flight, governments may be compelled by fiscal competition to reduce taxes and transfers in order to keep the rich, reject low-income and needy people and attract capital from abroad. The complementarity of market institutions and social protection institutions in fostering both efficiency and well-being might be undermined. The competition among the welfare systems may have differential effects on investors and the less-mobile unskilled workers and may undermine the long-term efficiency of the EU countries. While the EU has accomplished the objective of liberating the market-building competitive forces, the competition system may ultimately cripple the implementation of the market-correcting legislation. A possible strategy aimed at fostering positive integration could consist in a coordinated effort by those member states with similar systems of social protection to launch their own harmonization process.On the political side, the opposition to a federal Europe relies on the argument that no European demos exists. This position is controversial.
Equating demos with ethnos fails to distinguish between the pre-political cultural and historical ties and the common political objectives that a group of communities such as the European peoples may consciously set up as a result of public discourse taking place in the domestic and supranational democratic environments. A European constitution could be conceived as the self-recognition of choice of belonging to consensual norms and values (Habermas, 2001). An indicator of the democratic accountability of the EU governance system could be found in European citizens’ satisfaction with the consequences on their well-being of the implemented policies. Many domains so far excluded from the competence of EU institutions include several of the most important and controversial issues: the fiscal system, the welfare state, home security and immigration (Scharpf, 2002, 2003). From the consequentialist perspective, a poor EU performance in terms of positive integration indicates that EU citizens consider issues in the realms of domestic security and the welfare state so important for their well-being that policy makers do not dare to remove power from the national legislative bodies lest it provoke an uncertain harmonization outcome at the supranational level.