The Road to Maastricht

Transcription

1 The Road to Maastricht Negotiating Economic and Monetary Union KENNETH DYSON and KEVIN FEATHERSTONE OXFORD UNIVERSITY PRESS

2 Contents List of Abbreviations xxi Introduction: An Historical Overview 1 1. Making Sense of the EMU Negotiations 12 EMU Negotiations as a 'Core Executive' Activity 13 Conceptualizing the Negotiations: Structural, Strategic, and Cognitive Dimensions 15 EMU as a Prestructured Negotiating Process 19 EMU Negotiations as a Strategic Process: Power and Interests 33 EMU Negotiations as a Cognitive Process: Ideas and Knowledge EMU, the Mitterrand Presidency, and French Political Tradition 62 The Role of Inherited Beliefs and Historical Memories 64 The Tradition of the Republican State and EMU 67 French Leadership of Europe: The Primacy to Construction Europeenne 71 The Franc Stable: The Tresor and the Finance Inspectorate 75 Rebalancing Power in the International Monetary System: The Search for Economic Independence from the USA and the Problem of Asymmetry 83 Domestic Economic-Policy Traditions and EMU The Political Problem of Reconciling Domestic and International Interests in EMU: The Legacy of Barre, Giscard d'estaing, and Pompidou 99 EMU and Gold in the 1960s 100 Pompidou, the Hague Summit, and the Werner Report: The Turning-Point of The Fourcade Plan and the Reform of the 'Snake': The Giscard Presidency 112 'A New Bretton Woods for Europe': Giscard, the EMS, and EMU Challenging the 'D-Mark Zone': Agenda-Setting on EMU and the Strategy of Indirection under Mitterrand, Mitterrand's Beliefs about Europe and Strategy for EMU 125 Mitterrand's Governing Style and EMU 131

3 xvi CONTENTS The EMS, EMU, and Construction Europeenne: The Domestic and International Context, Finance Ministry Power under Delors: The 'Toumant' of 1982, Stage 2 of the EMS, and Defining French Objectives for EMS Reform 137 Mitterrand and the Political Management of the March 1983 ERM Crisis 142 Reconciling Socialism to Life in the ERM: Delors, Beregovoy, and the Franc Stable, EMU and the Relance Europeenne: Mitterrand, the Dumas Memorandum, and the IGCofl The ERM and EMU under the Cohabitation, : The Balladur Memorandum, and the Dumas-Genscher Relationship 156 Mitterrand, Beregovoy, and the Delors Committee 172 Activating Elysee Leadership of EMU after Madrid: The French Presidency, the Guigou Group, and the Conversion of Beregovoy French Strategy for the IGC: Making EMU Irreversible 202 Presidential Leadership after Strasbourg: EMU, Political Union, and the Domestic Political Context 204 The Bureaucratic Politics of EMU in Paris: Mitterrand, Beregovoy, and the Banque de France 209 The French Negotiating Team and the Structure of Core Executive Co-ordination: The Elysee, Dumas, and Guigou 216 Bureaucratic Politics and the Core Executive in the EMU Negotiations: The Finance Ministry and Interministerial Co-ordination 219 Squaring the Council of Ministers: Preparing the Paper 'Progress towards EMU' 221 Negotiating the French Draft Treaty on EMU: A 'Third Route' to EMU? 224 Managing Bilateral Relations during the IGC 231 Pursuing French Objectives in the IGC 236 The 'End-Game': Achieving 'Irreversibility' EMU, the Kohl Chancellorship, and German Political Tradition: The Legacy of Adenauer and Erhard 256 Kohl as 'Grandson of Adenauer' 257 EMU: Between European Unification and the Social Market Economy 260 Adenauer's Legacy and EMU: The Foreign Ministry and Chancellor Leadership 266 Erhard's Legacy and EMU: The Ordo-liberal Economics Establishment and Stability Culture, 274 German Negotiating Style: The 'Rule-Based' Approach The Political Problem of Reconciling Domestic and International Interests in EMU: The Legacy of Schiller and Schmidt 286 The Legacy of Schiller: The Werner Group, 'Coronation Theory', and Belief in Parallelism 289

4 CONTENTS xvii The Consolidation of Power of the Ordo-liberal Coalition on EMU 293 Schmidt as Finance Minister: The Changing Domestic Context of EMU 294 Otmar Emminger, the Bundesbank, and EMU 296 Schmidt and the Birth of the EMS: Challenging the Ordo-liberals 298 Schmidt's Legacy 301 The Second Stage of the EMS in 1982 <~ Negotiating EMU around the German Model: Agenda-Setting under the Kohl Chancellorship, Kohl's Beliefs about EMU and Governing Style 307 Stoltenberg and Finance Ministry Power over the EMS and EMU 313 Saving the EMS: Stoltenberg, Kohl, and the March ERM Crisis 315 Fighting off Delors's Trojan Horse: EMU and the Single European Act 316 Challenges to Develop the EMS: New Strains and Tensions 320 Genscher as 'Policy Entrepreneur' and Kohl's Political Strategy for the Hanover European Council 326 Seizing the Initiative: Pohl, the Bundesbank, and Strategy for the Delors Committee 342 The Struggle for Control of German Strategy after the Delors Report: The Timetable Issue and Madrid 350 Policy Reflection in the Shadows of the Delors Report, Madrid, and the 'German Question" 354 Genscher, German Unification, and the Date of the IGC 363 Kohl's Strategy for the Strasbourg European Council 364 After Strasbourg: Kohl's Ownership of the EMU Project German Strategy for the IGC 370 The German Approach to the IGC Negotiations: Key Themes 371 Kohl's Use of Metaphor and Historical Narrative to Reframe EMU 375 Finance Ministry Strategy for the IGC 378 Bundesbank Strategy for the IGC 386 Germany and the Italian EC Presidency: Stage 2, the Organization of the IGC, and Political Union 394 Putting the German Negotiating Team Together and Preparing German Bargaining Positions: From Rome 2 to the German Draft Treaty on EMU 402 Franco-German Relations after the German Draft Treaty: The Top-Secret Bilaterals 412 Kohl, the Chancellor's Office, and the IGC on EMU ' 417 Kohler and the IGC 423 The Bundesbank and the IGC 434 The EMU'End-Game': Saving the Treaty 437 Conclusion: 'D-Mark Patriotism', 'Coronation Theory', and Trusting the French 448

5 xviii CONTENTS 10. Italian Policy Beliefs about EMU: External Discipline versus Internal Protection 452 The Need for a Vincolo Estemo: Institutional Weakness at Home 455 The Tesoro and Sarcinelli 459 The Banca d'ltalia 461 External Discipline versus Internal Protection: The Two Souls of Faust 462 Policy Learning: Defer to the Market, Stay in Serie A 469 From Werner to the EMS 471 Italy and the Birth of the EMS 474 Divorce, Italian Style 479 Financial Market Liberalization Framing EMU as a New Vincolo Esterno: Policy Entrepreneurs, Co-ordination, and Reflection in Italy, Policy Entrepreneurs and the Core Executive: The Technocratic Opportunity 486 Andreotti and EMU: Guile Displaced by Technical Realities 491 De Michelis and EMU: No Time for Accountancy 493 Carli and EMU: Breaking Free of Andreotti? 495 EMU Co-ordination and the 'Gang of Three' 495 Italy and the Emerging EMU Agenda 497 Public Opinion and Europe 498 Italian Economists and EMU: A Rationale for Reform 499 From Basle-Nyborg to Hanover: Policy in the Shadow of the D-Mark 500 The Devout Courtier: Padoa-Schioppa and the Delors Committee 502 The Genial Architect: Ciampi, Institutionalism, and the Delors Committee 502 From the Delors Report to Rome 1: Sustaining EMU Italy and the IGC: Negotiating External Discipline, Avoiding Exclusion, Avoiding Relegation from Europe's First Division 510 Maximalist Ambitions: Italian Negotiating Positions 512 Negotiating Successes: Andreotti, Vattani, and Rome 1: Padoa-Schioppa's Formula for 'Automaticity' 514 Negotiating Failures: Maximalist Dreams Scuppered 518 Of their Own Free Will? 524 Let the British Take It or Leave It 525 Framing the Wider Package 526 Strategy and Coalitions 528 Any Deal is Better than No Deal? 530

6 CONTENTS xix 13. The British Political Tradition and EMU: Policy Legacies, Beliefs, and Co-ordination 534 The Trouble with Europe 534 Lessons from History? Policy Beliefs and Strategy on European Monetary Co-operation, Policy Beliefs and the Structure of the Debate on Europe 557 The Domestic Policy Process on EMU Resisting EMU: Political Strategy, Policy Entrepreneurship, and Policy Reflection before the IGC 601 Caught off Guard: Hanover and the Delors Committee 602 Britain's Belated Alternatives: The Competing Currency and the Hard ECU Plans 612 The Rome 1 Debacle 632 As a Window at Home Opens, That in Europe Closes 634 The Hard ECU and the IGC ' John Major: Between the Party and the IGC 644 Major, the Party Leader 645 Major and the Negotiating Strategy in the IGC 647 This Far and No Further: The Negotiating Mandate 649 British Strategy and Coalition-Building in the IGC 677 On the Margins, but Tied to the Core: Britain's Exit from the ERM 682 Conclusion: Inevitable Heartache or Avoidable Failure? Jacques Delors as Policy Entrepreneur and Ingenieur of the EMU Negotiations: Agenda-Setting and Oiling the Wheels 691 The Informal Presidentialization of EMU: Delors's Beliefs and Strategy 695 Delors as Animateur, Ingenieur, and Entrepreneur: Securing the Chair of the Delors Committee 706 Achieving a Unanimous Report: Delors as Ingenieur of Agreement in the Delors Committee 713 Preparing for the IGC on EMU: Delors in Retreat 720 The Role and Impact of Delors and the Commission in the IGC 726 Delors's Historical Contribution Conclusions and Reflections 746 What have we Leamt about the EMU Negotiations? 747 Why was an EMU Agreement Possible? 751 The Nature and Patterns of Coalition Building 758

7 xx CONTENTS Theorizing about Maastricht 770 Theoretical Implications of the Study 774 How Successful Was the EMU Agreement? 783 Some Final Comments: 'Locked' into a Politics of Deflation 799 Appendix: List ofinterviewees 802 References 809 Name Index 827 Index 839