The Common Market

When Prime Minister Harold Wilson wound up his tour of the capitals of the European Common Market and returned to London to ponder his decision on renewal of Britain’s old bid to join the Six, an experienced diplomat in Brussels gave this assessment of the mood at the Market’s headquarters:

“There is not the same excitement or missionary zeal for British entry among the marketeers as there was five years ago when Macmillan was negotiating. The fact is that the Treaty of Rome is now ten years old, the market is forging steadily ahead and working well, and there is a great deal of other business on the platter here in Brussels right now. British entry has a relatively low priority of interest. But I think on the whole that this is probably a good thing. The British can count on the fact that a majority of the Market commissioners do indeed favor their joining, just as a majority of the six countries do. But they must know now that the basic decisions which determine whether Britain makes it or not will all be made this time in London — not in Brussels or Paris.”

The priority of interest in Brussels, of course, will change rapidly when (there is no longer much “if” about it) Prime Minister Wilson makes his formal move. But in the meantime, there is indeed a great deal of other business which preoccupies the headquarters right now, so much so that the tenth anniversary of the Rome Treaty passed with barely the popping of a few champagne corks.

At the top of the list, the Kennedy Round of talks on cutting tariffs is nearing its feverish climax after three years of ups and downs in Geneva, and because the six Common Market countries negotiate as one, this had involved a great deal of back-and-forth between Brussels and Geneva as well as highly complex studies on the offers which the Six themselves should make.

Along with the Kennedy Round, there is the merger of the three European communities — Common Market, Coal and Steel, and Euratom — into one organization with one integrated staff under one commission. Agreed on in principle two years ago, and then held up when the French staged their Common Market boycott during 1965, this merger is now scheduled for completion in July. The bureaucratic reorganization involving some 5000 civil servants is enormous.

Meanwhile, the single grain price for all the Common Market countries is also scheduled to come into operation in July. This great leap forward will signal the start of complete “Europeanization” of agriculture for the Six, a process which has lagged behind the common market for industry. The common grain price will also increase the work load on the Brussels bureaucracy, involving as it does the promulgation of all kinds of new regulations, the computing and fixing of price and subsidy levels, and the administration of the agricultural levy fund by which a common grain price will be financed among the six countries.

Along with these developments, the Market has just taken its first step toward an integrated tax structure. Finance ministers of the Six have agreed that by 1970, all their national budgets will be based on a French system of “tax value added” in the collection of internal purchase taxes. The French add a percentage of tax at each stage of the turnover on manufactured goods, where other countries simply add a purchase tax percentage at the end of the line. By going to a common system, it will make it easier for manufacturers and governments to figure out export rebates on goods moving in community trade. But in fact, farseeing marketeers regard this as the first step toward a European currency and a common financial structure.

Complacence in Brussels

Nobody in Brussels, therefore, is holding his breath with anticipation over what Harold Wilson is going to do and when he is going to do it. In fact, assuming the best will in the world on the part of the Common Market and the simplest and most straightforward application to join which Britain can devise, it still looks as if it will have to be late this year before a new negotiation can really get under way.

Nevertheless, this lack of zeal or enthusiasm, the absence of any particular momentum or urgency in Brussels, does not connote hostility or opposition to British entry. Any good European can tick off the advantages to having Britain in, and everyone agrees that Harold Wilson has done a good job in his rounds of the six capitals in showing the advantages, particularly in the technological and big business fields, where the British do have top-flight corporate combines, capital, and expertise, which, combined with Europe’s, would more than match the corporate structures of the United States.

The problem from the Common Market point of view is simply that whatever the advantages, politically and economically, British entry is going to involve enormous upheaval and change for an organization which, after ten years, finds itself with a gratifying uphill momentum of its own. In the crisis of 1965, the French did their damnedest to immobilize and intimidate the Brussels bureaucracy, and before it was over, they did indeed gain certain strategic points, such as tacit agreement not to implement majority voting for the Community’s major decisions. But in the end, the French came back to Brussels and the momentum was resumed — perhaps not as flamboyantly as before, but at the same time with more inner self-confidence and assurance. The Market proved bigger than Charles de Gaulle.

To merge Britain into this tested ten-year structure is therefore not a task to send whoops of joy through the corridors of the headquarters. It means adding English as a working language, just for a start, and it means a new influx of English civil servants and commissioners. The paper work to bring Britain under the vast Common Market codification of trade regulations and procedures will fill rooms of files and take months of drafting. The commissioners and the headquarters personnel can be forgiven if they feel a little like a watchmaker who has just put a clock together and got it working when he is told to take it apart and insert chimes that strike, on the hour, an alarm. It will be a fine clock when it’s finished, a better clock indeed, but how are you going to tell time in the meantime?

The doubtful courtier

The Wilson visits to Rome, Paris, Brussels, Bonn, The Hague, and Luxembourg have probably been more educative for the British than for their hosts along the way. In fact, it became evident as Wilson made his rounds that the British were really debating with themselves, not with the governments of the Six. In each capital, the British presented pretty much the same exposition of “the problems as we see them” — primarily, agriculture, the effect of joining on Britain’s cost of living, transitional arrangements the British feel they need, and above all, Britain’s own economic situation, the position of sterling as a reserve currency in the world, and the efforts to end the balance of payments gap and establish long-term stability for the pound.

But the hearings and the responses which the British got around the circuit simply demonstrated that the Common Market is indeed a Common Market and that most of the

questions which Britain is asking, Britain will have to answer itself. Of course there were varying grades of enthusiasm for the idea of a new British bid — at one extreme, the warm handshake and encouraging arm-around-the-shoulder of Foreign Minister Joseph Luns of The Netherlands, and at the other, the cool cynicism of Maurice Couve de Murville of France, who shoved in the stiletto in 1963 at De Gaulle’s instruction.

But between these two extremes, the British did manage to talk away at least one basic problem, and that is the matter of a possible French veto. Everywhere they went, they received virtually the same appraisal: the French will not veto you this time, but they are counting on your vetoing yourselves.

Resignation in Paris, suspicion in Bonn

At the final plenary session of French and British ministers at the Elysée Palace, winding up two days of fairly intensive exchange of views, De Gaulle summarized by saying that he now perceived that Britain indeed was prepared to enter Europe. He remarked that the change in British attitude had come about more rapidly than he had expected, and he offered his congratulations to Prime Minister Wilson for the role he had played in bringing this about.

The British delegation gave these remarks a fairly cynical welcome, but at least De Gaulle had said a little bit more than they had expected of him. At best it means that if the British do meet all of the conditions for joining the Market, and do not bog themselves down in trying to negotiate changes or concessions which the Market is not going to give, then De Gaulle knows that he cannot keep Britain out. But it does not mean that the French are going to make things easy. Basically, the French do not want the British in, never have wanted the British in, want to be the big frog in this pond, and will bow only to the inevitable.

In Bonn, partly through their own mismanagement, partly through bad luck of the calendar, the British arrived to discuss their case with the West Germans at about as ill-timed a moment as was possible. First of all, Foreign Secretary George Brown had remarked at a press conference in London after the visit of Soviet Premier Kosygin that Britain was “in a way” moving toward recogni-

tion of the Oder-Neisse line. The fact that General de Gaulle long ago took this line, which is anathema in Bonn, does not make it any easier for anybody else to do the same as far as the Germans are concerned.

Coupled with this, the tired old argument over Germany’s contribution to the support of British troops was building up to a new and bitter outburst. And the Germans were in a major flap over the Anglo-American draft for a treaty to halt the spread of nuclear weapons, which in effect found the British lining up behind the United States and against Euratom, which Britain was proposing to join. Was history repeating itself? Was the Geneva nonproliferation treaty going to be for the British a repeat of the 1963 Nassau agreement, when Harold Macmillan swallowed the multilateral nuclear force plan in order to obtain Polaris missiles from President Kennedy? Was this yet another demonstration that Britain will always put relations with Washington ahead of relations with Europe?

To an extent these are pure smokescreen issues which need not, or certainly should not, affect Britain’s bid to join Europe in the slightest. But nevertheless, they do cloud and complicate the atmosphere, the political and diplomatic climate in which Wilson must operate. It was therefore not really very surprising that the Germans remained preoccupied, if not indifferent, to the British exposition. The British made the mistake the last time of consistently overrating Chancellor Konrad Adenauer’s support, and it is just as well that they not make a similar miscalculation on German support now.

“What practical purpose?”

And so Wilson wound up his tour to find that things were just about where they were when he started, except, possibly, that the minority opposition to his move in the British Labor Party was growing noisier and more troublesome.

“What practical purpose has all this served?” asked the leftist New Statesman. “This Grand Tour has been an authentic Wilsonian package. It commits the country to nothing, resists criticism by its vagueness, and yet gives off an aroma of purposeful — even sleepless — activity.”

The answer is, or ought to be, that the Wilson tour has had some practical results, obscure though they may be until a real decision emerges in London. On the nub issue of accepting the Common Market’s agricultural system — dumping the Commonwealth, placing import levies on cheap food coming into Britain, altering the British system of subsidy payments to farmers, and facing a cost-of-living increase of something like 4 percent as a result of this fundamental change — the British now accept unequivocally that they have no choice but to take a deep breath and swallow hard.

They also know that the Common Market itself must renegotiate all of its present agricultural arrangements in 1969-1970, when the levy system comes up for review and new percentages and changes will be worked out on a basis of the first years of operation. It is impossible for Britain to negotiate concessions on agriculture outside the Market, but it is simple logic to get in and negotiate as an equal when the next round of bargaining begins.

As for the question of Britain’s role in the world as a reserve currency country, there is in fact nothing in the Rome Treaty to be either negotiated or accepted. There is a clause in the treaty under which a member of the Common Market can appeal for help from other members in short-term balance of payments difficulties, but it has in fact never been invoked. The Italians almost resorted to it three years ago, but the United States and the International Monetary Fund stepped in with help instead. The British are considering a simple declaration of renunciation of this article along with their application to join.

Thus, at the end of the tour, fears of a French veto have virtually disappeared. Sterling and the reserve currency question is, or ought to be, a nonproblem so far as British entry is concerned. Agriculture will involve adjustment and change, but the cost-of-living increment for Britain could easily be spread across seven or eight years at less than half of one percent a year. It is true that the British are friends of the Americans, they speak English, their eyes are blue, and they still have a base in Singapore. It is also true that British entry will cause enormous difficulties and upheaval for the Market; that it will almost certainly be followed by a rush of applications from Denmark, Norway, Ireland, and maybe even Sweden, and the Market will never be the same cozy six again. The time may not be ripe in 1967, but there will always be reluctance, indifference, or opposition somewhere for somebody.

If Harold Wilson cuts through all of these issues and problems, real or invented, and turns up in Brussels with the barest minimum of requests for only the most obvious and necessary arrangements to join, the odds are that nobody will snatch the treaty away before he can sign.

—Don Cook