The EU, France, and Globalization: Questions and lessons for a new world
News Analysis: Globalization drives a wedge into EU By Graham Bowley International Herald Tribune SUNDAY, OCTOBER 23, 2005LONDON When European leaders gather in Britain on Thursday for an informal summit meeting to confront major economic challenges, they will confront a worsening relationship between France and the rest of the European Union that last week appeared in danger of spiraling out of control. The latest flash point came when France broke with the rest of the Union to demand continued protection for Europe's farmers from cheaper producers elsewhere. It was one of several clashes between Paris and Brussels this year as France resisted efforts to liberalize Europe's services sector, sought to weaken rules on national finances, tried to protect major companies from foreign takeovers and pushed for new quotas on Chinese textiles. The growing friction is explained by French attempts to hold back the pace of economic liberalization on the Continent in the face of intensifying global competition. This comes as the French economy is weak and the government is playing to the public's protectionist mood with presidential elections coming in less than two years. Amid a resurgence of national self-interest, the French government has come to view the European Union, and the projects that the European Commission is trying to pursue, as a threat to its old ways of life and to its standing in the world, which are coming under intense pressure from globalization. "France has not internalized a very important transition that is happening in Europe right now, which is the shift from the industrial economy to the knowledge and services economy," said Ann Mettler of the Lisbon Council, a market-oriented research group based in Brussels. "Its interest groups, which are very strong, are still trying to preserve the industrial age." French fears about the threat posed by the growth of economies beyond Europe's borders were encapsulated in the debate about the beginning of EU membership talks with Turkey, which France resisted before giving its approval. But the full picture of France's resistance to its unprotected integration in the global economy became much sharper this month when it held up trade talks at the World Trade Organization, whose goal was significantly lower farm subsidies and tariffs, mainly because of fears it would severely damage French farming. "The liberal regime within Europe, combined with the protectionist regime toward the rest of the world, worked pretty well when we could dictate the terms of trade," said Stephen Wall, a former adviser to Blair. "One of the things that we have had to realize in the age of globalization is that that is no longer the case."
Seems like there is a lot of upheaval in Europe these days and its mostly France's fault. Remember when they talked down to us about our out of control unilateralism and how we needed to pursue multilateral agreement to take down Hussein and the like? Well, it looks as if that was a case of do as I say not as I do. Turns out France is going it alone within the EU, going against the entire community to protect, well, its national interest. Don't you just love picking on the French, honestly!
In all fairness to France, the transition from an industrial economy to a service economy is a pretty difficult thing to achieve. We've been going through the same transition for the past decade or so, and even now we continue to give in here and there to the protectionist impulse.
The story does give us some great insights into Barnett's maxims that (1) "to accept globalization is to accept change" and that (2) globalization will change us more than we could ever hope to change it." If we look at the European continent as a world unto itself, and the EU as akin to the globalization that we are currently experiencing in the world at large, you can see echoes of the many issues we are facing now.
France, at first embraced the EU, and used it as a tool of its own power. As it has expanded however, France's influence has diluted as more players have a say in the system. Now, it is a pariah among the nations of Europe, rejecting the EU constitution and opposing many of the programs the EU as a whole would like to implement to move away from an industrial based economy to a services economy.
France so far has been unwilling, or unable to accept change and now it is in danger of having it forced upon it by the very system it helped to create. It is now learning, in the case of the EU, that "the system comes with rules but nor a ruler, and that while it may propose it can never impose, because the difference between the leader and the led is not merely their competing visions of power but the power of their competing visions." Clearly, in the miniverse that is the EU, France's vision is losing.
As with any analogy, the above isn't perfect and has its problems and I am not suggesting it is all encompassing or reflective of the current state of the world system as a whole. Rather, I am merely suggesting that it touches upon many issues in PNM and the ideas derived therefrom.
Moving away from that analogy the story also brings to light other issues with respect to the effect of globalization on regional trading bloc's. As the EU expands and has to confront a globalizing world it, like the states it is made up of has had to adapt to ensure it can prosper in a world of new rising powers such as India, China and Russia.
As the Core grows, the old Core members are realizing that they can no longer dictate the terms of trade to the new core or the Gap (as new core members search for resources and compete with old core members, gap countries can balance them against one another to get a better deal, this is particularly true of extractive economies; Venezuela, Iran, and even first world Canada)and hence the old policies used to sustain that system are no longer relevant in this new globalizing world order. As we have learned in the case of Iran, we can no longer isolate it as much as before (and even before it was almost impossible). Now, new Core members who depend on Iranian energy resources cannot but oppose us in any attempt to resolve the Iranian issue militarily.
That is one of the main dangers of the rising global order, how to navigate through the myriad problems left to resolve without destroying or retarding the connectivity we have worked so hard to build.
