At 344 pages in the English-language version, the Consolidated version of the Treaty on the Functioning of the European Union, as one might expect, shows a certain comprehensiveness. The bloc’s constitution includes three pages of rules governing refinery exports in the Netherlands Antilles. It is mentioned who gets summer houses in Denmark (only Danes). Somewhere there are also bits about how EU laws outlining the various powers of the European institutions are being passed in Brussels as they guide the 27 member states towards an ever-closer union.
But the rule book’s more than 600 articles make no mention of the decree, which arguably has authority over all EU business. Some say that it no longer exists, others that it never really was; Eurocrats talk about it quietly, as if they are careful not to wake up the monster. The Luxembourg Compromise states that any national government can single-handedly overthrow any EU measures when he feels that his “vital interests” are threatened. Under the rules, in most cases, if enough member states agree, they can impose their will on the recalcitrant few. In the real world, the compromise suggests, an outcry from any national government is loud enough to stop even measures agreed by the remaining 26 and EU institutions, rules, damn it. (This measure was designed in 1966 to appease Charles de Gaulle, who was so annoyed that smaller Europeans had plans to impose their rules on the French.)
Compromise is rarely seen in the wild; in any case, its use is threatened behind closed doors. However, there are many other similar vetoes in Brussels. The majority EU the matter is now agreed upon by a qualified majority of countries. But unanimity among member states is still needed in some policy areas. This includes everything related to defense and foreign policy, expansion, taxation and law enforcement. Cynical politicians used this to extract concessions from their fellow Europeans. Countries blocked EU joining one’s neighbors to gain advantage in some local dispute; Little Cyprus blocked sanctions against Belarus in 2020 because it wanted to EU focus on Turkey. But the master of the pernicious veto is undoubtedly Viktor Orbán, Hungary’s autocratic prime minister. Earlier this year, he advocated round after round of sanctions against Russia, and now he is threatening to block Europe’s participation in the global corporate tax deal. In both cases, a connection can be drawn between Hungary’s veto and its ongoing struggle with EU on unrelated issues. An expert bulkhead artist, Mr. Orbán saw an opportunity for profit and seized it.
The existence of any national vetoes infuriates federalists, who worry that selfish local politicians stand in the way of a functional European superpower. These complaints can mostly be ignored. A veto is rarely a real problem. They often reflect legitimate grievances, and the adjustment to them improves EU politicians after all. Abolishing them would shift too much power away from national leaders whose democratic legitimacy far outweighs that of little-known mepor commissioners. On September 20, at a meeting of European ministers of the bloc, ways of waiving the veto of a larger number were discussed EURussian business by increasing the use of qualified majority votes. But since the very proposal to move away from unanimity requires unanimity, it is unlikely to go anywhere.
That leaves EU with an ongoing problem. The use of Hungarian-style vetoes clearly goes beyond the use for which they were intended. So a new rule is needed: call it Reverse Luxembourg. The original Luxembourg Compromise states that in situations where the veto is normally prohibited, it may be reinstated in exceptional circumstances. Reverse Luxemburg suggests that in situations where a veto is normally permitted, it should be prohibited in equally rare cases. The Luxembourg Compromise protects against federalist overreach. A reversed Luxembourg will protect Europe from diplomatic blackmail.
As with the original compromise, there is no need to codify the reverse Luxembourg in any treaty. It would be more effective to punish the use of clearly abusive vetoes with cuts EU money sent to countries that deploy them. Such threats are working: Hungary is now scrambling to update its anti-bribery laws to avoid losing up to 7.5 billion euros ($7.4 billion) in funding from Brussels. The EU regularly proposes new spending programs, such as the €750 billion pandemic relief fund created last year. It is not difficult to come up with such schemes for 26 countries instead of 27: similar workarounds were once used to bypass Britain in its most contentious years as a member of the club. Hungary (along with Poland) is currently receiving no funds from the pandemic, in particular due to deficiencies in the rule of law. A notification that member states should not use the veto to take over the bloc’s business could be an additional criterion for obtaining EU generosity
A reversed Luxembourg would solve another problem Europe will soon face: how to manage a union of 35 or more people after enlargement to Serbia or Ukraine without getting bogged down in the thicket of potential vetoes. Germany and France have hinted that more matters need to be done by qualified majority for their agreement EU expansion. Eastern Europeans are interested in enlargement, but also want to retain veto power, especially in foreign policy matters where they do not trust France or Germany. Reverse Luxembourg is a great compromise. It retains the legal right of veto while maintaining EU managed.
Skeptics will respond that a veto that can be overridden is not a veto. And who would decide if the veto was cynical? Why is Ireland allowed to block the tax deal but not Hungary? Like pornography, veto abuse is something to know when you see it, and Europe has seen enough recently. The Luxembourg Compromise strikes fear into the hearts of federalists precisely because no one knows its exact contours. Let’s come up with an option to keep cynical exploiters EU controlling the rules would stop their undue influence. ■
Read more from Charlemagne, our European politics columnist:
The demonization of nationalist parties did not stop their growth in Europe (September 15)
Norway shamefully profits from the war in Europe (September 8)
Is the EU going overboard with new digital rules? (September 1)
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