What did change was firstly that Germany’s advocacy of political union acquired a novel assertiveness, which tended to undermine French certainty of how the dual understanding would operate in future. Secondly the grounds on which the French, led strongly after an initial period of reluctance by Mitterrand, would seek to redefine the partnership also changed. It is perhaps necessary to emphasize the French government’s increasingly urgent search for monetary union, even more than the German desire for political union. The Mitterrand-Kohl agreement to balance the two, in order to retain their informal parity, despite Germany’s increase in size and status as a result of reunification, and to bind this new Germany firmly into a deeper, as well as larger Community, was to be the single most important phenomenon between the two IGCs. Neither that nor Maastricht would have happened without French fears of what a united Germany would otherwise become.
The price, on France’s side, was political union; on Germany’s it was monetary union. After Kohl’s about-turn on EMU to meet French demands in 1988, the German government (though not the Bundesbank) showed itself positive about the common currency even though it would involve losing the deutschmark – that is, so long as the new one was based solely on principles of economic stability and was managed only by the new Central Bank. Fluctuations in their relations continued, of course, at diplomatic levels: however these were repaired by the Kohl-Mitterrand proposal to have a second IGC on political union, made in April 1990 before the Dublin Summit, and strengthened during that IGC where foreign and security policy, and later European defence, were concerned. Much less consensus was obtained about EC institutions’ power, for elite German opinion valued an increase in the European Parliament’s democratic functioning so highly that the government tied it to its consent to EMU, as the only way to defuse domestic hostility to the impact of Monetary Union on the deutschmark.
From the French point of view, these attempts to tie EMU to Bundesbank management criteria, and to strengthen the Parliament, could be made acceptable if Germany were induced to accept a fixed schedule of progress leading from the ERM to complete monetary union on France’s terms. The French government also hoped that the Common Foreign and Security Policy (CFSP) could be extended to cover defence but on French, rather than NATO, terms: Mitterrand wisely gave instructions not to raise this question too early on. A substantial reordering of France’s domestic priorities would be involved in approaching the question of political union, but not of a size to require major or public changes in the machinery of French government.
All this contrasted sharply with the British case. Margaret Thatcher’s last two years were increasingly overshadowed by her belief that a grand conspiracy had come into existence, manoeuvred by Christian Democrats, renegade Socialists and the Commission led by Delors, with the aim of imposing Brussels’ sovereignty on a permanently embattled offshore island. But whatever her forays may have gained tactically in 1988 and 1989–90, they were mostly pyrrhic victories ending in acquiescence, for lack of allies. Meanwhile, on the domestic front, she was gradually manoeuvred towards acceptance that Britain should join the ERM by an entente between her chancellor, Nigel Lawson, and the foreign secretary, Geoffrey Howe, which, for lack of a true cabinet majority, she was unable to rupture.
On top of this came German reunification which she vigorously, and probably unwisely, attempted to delay by enlisting Mitterrand’s support during his period of uncertainty of how to react – as if a French president with his personal background had not been aware of its implications. Such tensions had already showed themselves in her speech at Bruges on 20 September 1988 – which became celebrated in retrospect for the tone of its delivery and its reception by the Conservative Eurosceptics rather than its actual content – accepting ‘Britain’s destiny is in Europe as part of the EC’ (but an EC that was imagined as a commonwealth of free independent nations working in harmony together, with a free trade policy covering the whole of Europe.) The text represented a modification of what she had herself accepted in 1985–6 but was consistent with a more general ‘Anglo-Saxon’ view that the EC was essentially an economic vehicle.
Like so many of Margaret Thatcher’s deep-rooted beliefs, these fears rested on a basis of evidence which was inevitably heightened and distorted by her personal perceptions, now ingrained in a long-running administration.2 She encountered other EC heads of government only at summits, and had become isolated, largely because she no longer listened to the complex skeins of Whitehall advice. She was aware of this isolation, aware also of the strength of the EC majority, how her tactics often united them against her, and perhaps of how much less Britain counted with the United States under President Bush than it had done with Ronald Reagan. Yet she seemed unwilling or incapable of acting otherwise than Napoleon in his last campaign of 1814, winning many of the tactical battles but sliding to long, remorseless retreat. She was unwilling above all to examine her lifelong preconception about what ‘Germany’ really was.3
No such inhibitions restrained the Commission after Delors’s second term began, though he was to be dogged, in the press of several nations, by his assertion that by the year 1998, thanks to the Single Act, 80% of economic, and possibly fiscal and social, legislation would emanate from Brussels. This claim seemed to be heightened by Delors’s address to the Trade Union Conference in September 1988, which Thatcher used to justify her neo-Gaullist defence of national sovereignty – so long at least until the rest should have considered more carefully where all this would lead.4 The Commission, of course, had considered carefully, as the whole edifice built on the 1985 White Paper demonstrated. But it could not control how its proposals to the Council would be interpreted outside, in the press and on television in the twelve member states. British politicians could argue that in implementing the single market programme, the Commission often acted by stealth or resorted to rarely used powers such as Article 90, to force member states to open their telecoms markets to other EC competitors.
Views like this derived from evidence of various kinds: Commission documents such as the internal guide on how to infiltrate the mass of single market legislation through Coreper and the Council of Ministers; or the steadily increasing agenda of items contingent on the internal market. Delors’s campaign to represent the EC, not only at G7 meetings but at all functions dealing with external trade and GATT, appeared to aggrandize the Commission vis-à-vis member states. Indeed the Greek Presidency’s rather presumptuous initiation of direct talks with the Soviet Union in 1988, as if ‘representing the EC’, can be seen as a small state’s rejoinder; one that was reiterated by the Spanish Presidency early in 1989 over trade with Japan. That the Commission did retract, as it had done often in the past, on some of its more contentious positions in order to take a more emollient line, was less often remarked.
For example, concessions made by Delors and Christiane Scrivener, the Commissioner responsible for taxation, on VAT harmonization, which the British in particular had resisted, appeared in any case to accrue to the member state holding the Presidency, or to the European Parliament. In strategic terms, a grand design clearly did exist by 1989, on which the Hannover Summit’s accord allowed the Commission two priceless years to expand. But this might have happened in any case, without the Commission’s driving force, since preoccupation with Euro-sclerosis did not automatically vanish in 1988. It was certainly accelerated by the entry of financial institutions as significant players, and employers’ determination Europe-wide to use the internal market’s four freedoms firmly to re-establish managerial rights and enforce further deregulation of wages, security of employment and conditions of work, to the inevitable detriment and dismay of trades unions.
The Commission, led very strongly by Delors during the period 1988–91, provided a focus for what might otherwise have been diverse activities. Delors’s speeches and the agenda he outlined each January to the Parliament increasingly embodied a particular view of the inexorable unity of economic and social spheres; put simply, that EMU and the Social Charter should run in tandem. The argument that the EC needed a new deal (with undertones of Roosevelt’s New Deal) to safeguard concertation (as long as that had genuine economic content) and to give some hope of a return to full employment, required the Community to examine training and education, technology and structural cohesion, together with redress for unemployment and support for the areas of late 1980s industrial devastation.5