THE GOVERNMENT faces an undeniably complex task in formulating a strategy to negotiate the international treaty on a reinforced economic union with 25 other members of the European Union. The United Kingdom’s decision to veto an agreement means the treaty will be outside existing EU law. It will be implemented once nine states accept it, according to the draft now circulating.
Thus, to the legal uncertainty over whether a referendum will be required in Ireland, there is now added the political realisation that the treaty’s implementation does not depend on how Ireland votes.
That makes a coherent strategy all the more necessary. It must combine realism about Ireland’s – and Europe’s – economic circumstances with a determination to identify and defend Ireland’s best interests and an ability to communicate that policy to a more attentive and better informed public. Realism means recognising we are highly dependent on EU funding to fill the gap between State income and expenditure. The Government’s plan to repay debt depends on domestic and international growth; and even if that happens the burden of debt is unsustainably large and needs to be reduced. The multilateral approach to achieving this objective depends on maintaining Ireland’s place at the heart of the euro zone to argue the case for growth and eventual debt reduction.
Linking Ireland’s acceptance of the new treaty immediately to debt reduction is not necessarily the best approach without a veto on the outcome. It would be more sensible to help fashion the conditions in which the EU is better able to create sustainable growth and then deal with debt problems in programme countries like Ireland, Portugal and Greece.
Another great uncertainty is whether, after euro zone members agree to this strict fiscal compact, Germany and its allies are willing to help create the conditions for growth and debt sustainability by allowing the European Central Bank more flexibility and enabling eurobonds. Irish and other calls for such a reciprocity must be heard and respected if they are to convince their publics it is worth this painful effort.
Careful choice of allies is crucial. Ireland’s interests align it not only with the EU’s northern creditor states on which we mainly rely for emergency funding but with southern debtor states needing to reduce that burden. Our economic survival depends on an expansionary approach to growth and employment. Ireland needs to argue for the fullest involvement of the European Commission and other common institutions in this reinforced economic union. This will protect the interests of smaller states against an undue power for the largest ones. Ireland’s interests have not been well served by the UK veto but we share certain values with that state and should work to keep it at the negotiating table even if it lacks a vote there.
Bringing these strategic elements together in negotiating this treaty is a demanding task but can convince the public it is worth passing.