In fact French attitudes shifted surprisingly fast. It is possible that there were objective factors behind the change. For example, new concern about German economic power emerged, especially as France’s balance of payments weakened. Germany’s refusal to revalue during the monetary crisis of 1968 reinforced the fear about the balance of power within the Community which may have produced a feeling that the UK could serve as a countervailing force. Secondly, the Warsaw Pact’s invasion of Czechoslovakia had led de Gaulle to repair relations with the USA. It has been argued that this made it senseless to persist in seeing the UK as an Anglo-Saxon ‘Trojan horse’ in the Community. Although both of these arguments are plausible, until evidence is provided to the contrary it seems most likely that the contemporary view, which attached the greatest importance to the shift in power from de Gaulle to Pompidou, was closest to the truth. Although the government was still ‘Gaullist’, under Pompidou it contained four ministers who were members of Monnet’s Action Committee for a United States of Europe. Whatever the ultimate reason, in July 1969 Maurice Schuman announced that France was willing to countenance some European rélance. Proposals linking the completion, strengthening and enlargement of the EEC would be forthcoming at the Hague summit in December.26
The Commission quickly wrote the Hague summit into its hagiology calling it a ‘turning point in its history’ (EEC Bulletin, 1/1970). It would be churlish to deny that much was accomplished, although different countries laid different emphasis on different parts of the package. France was most interested in completion of the Community and, specifically, the financing of the CAP. The others were primarily committed to enlargement. Nevertheless the decisions at the Hague, taken together, represented an ambitious programme for future development. It was agreed to find a definitive financial arrangement for the CAP by the end of 1969. By July 1970, ministers had requested a report to deal with possible developments in the field of political unification. By December 1970, they wanted a further report on Economic and Monetary Union (EMU). Last, but undoubtedly not least, it was agreed to open negotiations with candidate-countries.
Implementation of the agenda began immediately after the conference. Between 19 and 22 December, agreement was reached on financing the CAP and on the EEC’s financial resources. The latter involved allocating to the Community all receipts from levies and customs duties, as well as national contributions to cover any deficits, and their gradual replacement by receipts to be calculated on the basis of an assessment of harmonized VAT. Committees were installed to draft the requested reports. Two major reports were published in 1970: July saw the publication of the Davignon Report on political unification, while October saw the Werner Report on Economic and Monetary Union. The fate of EMU has been dealt with in the previous section, but the cornerstone of Davignon’s recommendations was foreign policy coordination, described as ‘European Political Cooperation’ (EPC), which rested upon regular meetings of foreign ministers and high officials. Its first achievement was to produce a concerted position during the Conference on Security and Cooperation in Europe that produced the famous Helsinki Accord in 1975.
However, the Hague summit’s main achievement was to re-open enlargement negotiations. Within the UK, a range of studies had attempted to balance a calculable economic ‘loss’ (attributable entirely to the structure and funding of the CAP and the structure and direction of UK foreign trade) against potential economic gains (as the economy benefited from both the static and dynamic effects of customs union). Most managed to arrive at a favourable result. Nonetheless, the negotiations did result in the adoption of new policy areas, noticeably in the creation of a regional fund, from which the UK was likely to emerge as a net beneficiary, in an effort to redress at least part of the transfer problem. These measures, however, stopped short of any automatic redistributive mechanism. No such problems arose with Denmark or Ireland, which were expected to emerge as net beneficiaries from the system.
The membership negotiations were sucessfully concluded in June 1971, following a top level meeting between Edward Heath and Georges Pompidou the previous month. Negotiations for a series of industrial free trade agreements with the remaining EFTA states ran in parallel and were concluded in subsequent months. January 1973 thus represented not only the moment of the first Community enlargement but the closing of a passage of history that had begun in 1958 with the failure of efforts to secure industrial free trade in western Europe. The moment was marked by an optimism scarcely dented by nagging differences on monetary policy. However, 1973 was also the year in which the inflationary boom of 1971–3 was savagely punctured, one of the immediate casualties being the prospects for Economic and Monetary Union. But although it was not immediately apparent, other treasured assumptions that had marked the 1950s and 1960s were destined to be discarded: economic growth, full employment, efficacious Keynesian economic management, technological leadership, to name but a few. It was in these new conditions that the Community had to absorb its three new members.
There is a received picture in Britain of a Community slumping from the high point of optimism reached at the Hague in 1972 into a dismal decade of inertia, relieved only by fractious competition among its member states. Like all received pictures it contains truths. The aspirations of 1972, such as the Davignon Report’s attempt to address the issue of political cooperation for the first time since the mid–1960s,1 and the Community’s first enlargement in 1973, did little to break the pattern of self-interested national bargaining vying with rare bursts of collective altruism. Worse, the recession set off in 1973–4, and renewed in 1980–82 after an uneasy remission, brought internal problems and a pan-European sense of relative decline. Yet EC institutions sustained the idea of integration with an often surprising momentum in the interstices, so that the astonishing regeneration of the mid–1980s has to be explained not only in terms of a sudden shift around 1984 but in an accumulation of long-planned strategies at different levels within the Community and among different categories of players in the game.
The accession of Britain, Denmark and Ireland on 1 January 1973 occurred while the optimistic mood survived, so that the immediate consequential processes of adapting EC institutions and negotiating the informal areas took place against a background of goodwill, buoyed up by affinity between Edward Heath’s government and that of Georges Pompidou. But ministers and officials in Brussels had also to adapt to – or frustrate – the expectation of two new small states (Denmark and Ireland), both with a high agricultural content to their economies, and one large one (Britain) whose predominantly industrial economy, currency and financial institutions were, by the end of 1973, manifestly in disarray, and its industrial relations close to civil disorder.
Yet in the years of Britain’s final negotiations, the climate of opinion both in the EC and in the Heath government had been optimistic, even euphoric. To French observers, Heath seemed not only willing to pay the full price of entry but to bring for the first – indeed in retrospect the only – time a genuine willingness to follow European models of industrial policy and industrial government. In turn, Heath saw his DTI and regional innovations as material for the