Introduction

The Single European Act was formally approved by the European Council in February 1986. When Maastricht hit the headlines in the early 1990s, the Single European Act instantly became history. However, it was the Single Market programme – the main content of the Single European Act – and the years of preparation leading up to it that really gave new momentum to European integration after the ‘Eurosclerosis’ of the 1970s.

The process that led to the Single European Act was never publicly discussed. The architects and initiators of the Single Market have not become household names; however, it is these protagonists and their efforts that are the subject of this chapter.

The thesis guiding our empirical research on the new momentum in European integration suggests a collaboration between the Commission of the European Communities and European transnational business represented by the European Roundtable of Industrialists, as stated in more detail in chapter 1. This explanation contrasts with other theories, which have placed the governments of the three main European Community member states – Germany, France and the United Kingdom – in the foreground. The empirical evidence to support our explanation was gathered by analysing various articles and papers and the official documents of the European Communities and from interviews with witnesses and protagonists of the integration process.

Three main points from the contents of the Single European Act must be emphasized. First, Article 13, which provides an amendment to Article 8a of the EEC Treaty, requests the institutions of the Community ‘to adopt measures with the aim of progressively establishing the internal market over a period expiring on 31 December 1992.

Introduction

In this chapter we examine the question of whether technology corporatism – established at the beginning of the 1980s – also flourishes beyond the domain of information technology, where it was initiated (see chapter 4). Moreover, we consider whether it shaped Europe's competitive position in biotechnology, an industry widely considered to be among the most dynamic in the twenty-first century.

The starting point of a European biotechnology policy was the Commission's insight at the beginning of the 1980s that the Community displayed a technological backwardness with respect to the USA and Japan and that bio-industry could make a decisive contribution to resolving the employment problem. Therefore, by the middle of the 1990s, the advancement of biotechnology was to become – as Davignon predicted above – an established goal of the technology policy of the European Union. Consequently, the Commission pushed for research programmes and a corporatist policy formulation process that included the participation of the interest organizations of bio-industry.

In contrast to information technology, however, the ‘national champions’ in the chemical and pharmaceutical industries were not very interested in European research programmes similar to Esprit (see chapter 4). Indeed, they had already established transregional alliances even before the first programme was launched and preferred competitive to pre-competitive research. Yet, during the 1990s their industry associations closely cooperated with the Commission because they regarded existing regulations as too restrictive.

Western Europe's move toward political union entered widespread public debate only at the beginning of the 1990s. In fact, it had begun almost a decade earlier, culminating in 1985 in a bargain that recast the European Community: the Single European Act. At the time, these events hardly received the attention they deserved. However, they marked a historic step from a Community paralysed by lethargy and budgetary squabbling in the ‘Eurosclerosis’ era to one in which the Community proved its worth by creating political structures ‘that will give it a prime role in helping define the post-Cold War world order’, as the Community presented itself to the world at Seville's 1992 Universal Exposition. One key protagonist of the decisive events, in fact one of the architects of the Single Market project, commented as follows: ‘There are turning points in history. Frequently only dimly perceived at the time but later clearly identified. The renaissance of the Community which was launched by the Internal Market Programme and, in its wake, the Single European Act is likely to prove such a turning point’ (Cockfield 1994: 157).

The significant change within the Community during the mid-1980s became evident in two events that find their expression in two documents published by the Community: the Commission's White Paper (CEC 1985) for the European Council (heads of state and governments) regarding the completion of the internal market, and the Single European Act, adopted in December 1985 by the European Council and formally approved by the Council of Ministers (ministers of foreign affairs) on 28 February 1986. The White Paper was a political initiative of the Commission. As such it was not exceptional.

What kind of state?

Having reassessed the integration thrust of the 1980s and the events that it set in motion, we have summarized our findings on the structure of the policy areas that set the tone of the political economy of the Union. We would now like to comment on the form of state that developed out of this process. The curious nature of this state is widely acknowledged by scholars; we would like to add that the puzzling nature of the governance structures embodied in the institutions of the European Union is due to a renewed compromise between two old European processes – nationalism and liberalism.

The European Union, which evolved from the renewed drive for European integration in the mid-1980s and which officially assumed this new name through the Treaty on European Union (agreed to at the end of 1991 and in effect since the completion of its ratification in 1993), is something new in the recent history of European state-building. This new form of state remains, as we termed it in chapter 1, a somewhat strange hermaphrodite – something between a confederation of states and a federal state. One important difference between the two is that a federal state unites several states within the framework of a single state in a single nation and is the exclusive subject of international law. By contrast, a confederation of states does not constitute a subject of international law on its own (Scholz 1995: 116f).

Without doubt, the internal market programme was the core element in recasting the European bargain with the Single European Act of 1986. Chapter 3 by Nicola Fielder reports the findings from analysing the relevant documents and from interviewing protagonists, witnesses and experts (see list of interview partners in the appendix to this volume). How energetically the Commission pushed the internal market and how vigorously the European Roundtable of Industrialists demanded it is clearly revealed by the empirical evidence. Chapter 3 points not only to the mutually reinforcing constellation at this transnational and supranational level, but also to the linkages between national and supranational levels in explaining the decisive events of the mid-1980s. The evidence for the latter – which has already been suggested in the literature – thus slightly modifies our original hypothesis.

The European proposals for technology corporatism are researched in more detail in chapter 4 by Simon Parker. From this it becomes evident that these initiatives go back to the late 1970s and also that the resulting new procedures clearly pre-date the Single European Act, which, however, included the by then established new praxis into Community law. The finding of a certain post-SEA disintegration of the alliance between the Commission and the Information Technology Roundtable is worth mentioning. We will come back to this when we deal with developments in a later period (see Part III).

The internal market as well as European technology corporatism were obvious manifestations of elite bargains between the Commission and the various Roundtables.

The cohesion target – introductory remarks to chapters 5 and 6

Along with the internal market project and technology policy, regional and social policy elements are additional important political dimensions of the integration thrust of the 1980s. The consistency with which the cohesion target is reinforced in its various formulations in the conclusions of European summit meetings and annual Commission programmes is impressive. This no doubt reflects the societal consensus in all member states of the EC regarding the necessity and desirability, in accordance with Marshall's famous definition of social policy, ‘to use political power to supersede, supplement or modify operations of the economic system in order to achieve results which the economic system would not achieve on its own’ (Marshall 1975: 15). The principle of state-organized balancing between classes and regions was and is a central element of the Western postwar model (Bornschier 1996), even when there were and are different forms and levels of development among the member states (see Esping-Andersen 1990; Schmid 1995). This societal consensus continues to exist in Western Europe, as surveys show (Ferrera 1993), even during the present tumultuous times of fiscal crisis and system rebuilding.

In this context, the definition of the functions that the European Community, as one level of statehood in Europe, is supposed to take on remains controversial. In fact, in the 1980s the cohesion target was anchored in the treaties, which represented a marked expansion of the ‘welfare state mission’ of the Community. For the proponents of a European federal state, the existing EC functions in this domain are stages on the way to a supranational system of social policy regulation with financial equalization.

Introduction

The signing of the Single European Act did not make the internal market a fait accompli, a view shared by European Roundtable members, whose actions became more pronounced. A watchdog group, the Internal Market Support Committee, was formed in December 1986; its members met regularly with unions, heads of state and government, top government officials and key commissions of the European Community and emphasized the urgency of fulfilling the goals set by the Single European Act. Nowadays, the European Roundtable of Industrialists (ERT) is still considered one of the most influential interest organizations in Brussels. The evidence for this consists not only of the self-description by the president of the Nestlé administrative council and interviews with representatives of European umbrella organizations but also in the very origins of the Single European Act (see chapter 3).

In this chapter, we want to sketch the organization and development as well as the financial and management interconnections of the Round-table. First, the history and the activities of the Roundtable up to the passage of the Single European Act are outlined.

The signing of the Single European Act did not, however, make the internal market a fait accompli. Chapter 7 by Michael Nollert, in collaboration with Nicola Fielder, shows that this was also the view of the European Roundtable of Industrialists and that they continued to lobby for the goals set by the Act to be met. In studying the evolution of the Roundtable from the 1980s to the 1990s its extraordinary position becomes evident, especially when compared with the halfhearted EC policy of the main European umbrella business organizations. The Roundtables have been active ever since the early 1980s and even gained in membership as well as interlinked economic power. But, having successfully helped to push for the new European economic order, they had no comparable influence on other issues of the ongoing European integration.

Looking again beyond the Single Act, chapter 8 by Michael Nollert analyses the further development of European technology corporatism. He investigates in detail the European biotechnology policy – shaping an industrial branch predicted to be among the most dynamic of the twenty-first century. This chapter points to an enormous surge in funds provided by the Commission and to the established dialogue between the interest organizations and the Commission, which evidence the working of technology corporatism outside the information and communication sector where it was first established at the beginning of the 1980s. Yet, the limits of European technology corporatism already mentioned in chapter 4 by Simon Parker are also evident in Michael Nollert's chapter on biotechnology policy. The current challenges lie in transregional alliances of the leading enterprises and in the massive public reservations about EU biotechnology policy.

A considerable part of the debate on the reasons for the integration thrust in the 1980s is based on the not always precise differentiation between statements on the origins of political initiatives, the corresponding agenda setting, the mediation of interests and thus the transformation of the initiative and its adoption. This is shown with the often undifferentiated use of the terms ‘1992 Initiative’, ‘EC reform’, ‘Single European Act’ (SEA), etc. Furthermore, the origins of political initiatives and the prerequisites for their success (or failure) are often imprecisely distinguished from each other. This chapter chronologically and logically follows chapter 1 in that it reconstructs the process of the construction of a successful package deal, the Luxembourg package, by making reference to the analysis of the causal factors of the integration relaunch. The Luxembourg package is hereby defined as the entirety of the agreements on the insertion or amendment of articles in the EC treaties, as they were formulated during the intergovernmental conference in 1985, which together form the Single Act and which were adopted by the Council of Ministers in 1986.

The first section presents some theoretical considerations on the conditions for success of a package deal. The following section describes important integration projects and processes for forming alliances. The first six months in 1984 are seen as the ‘take-off’ phase for the SEA. The Commission's changing role, its actual ‘rebirth’ as a result of an altered situation and as a precondition for the creation of a negotiation package, is then discussed.

Introduction

The relatively low rank of the ‘social dimension’ in the renewed push for European integration in the 1980s provides the starting point for three competing theses on the integration process. First, the cornerstone thesis holds that, from the beginning, the Europeanization of social policy was a cornerstone of the integration project as conceived by the supra-national political entrepreneur, the EC Commission, and certain governments. The conception of the social policy domain in the Single Act (most importantly, Articles 21 and 22 of the Single European Act, i.e. Articles 118a and 118b in the EC treaties) remained narrow for purely tactical reasons so as not to endanger the strategic goal of relaunching European integration. Second, the supplement thesis states that the core of the project, which was legally established by the Single Act, was the internal market. When it became apparent that this effort might not be successful (particularly owing to the public debate about its social consequences in the years 1987–8), it became necessary to provide, albeit belatedly, a social policy cushion for the impact of the internal market. According to neo function a list reasoning, the politicization of social policy following the Single Act was an aftereffect of intensified economic integration. The packaging thesis argues that the weak social policy regulations together with the abundance of social rhetoric were merely an expression of the selling of an elite pact to the European public; it was simply a matter of ‘packaging the package’. According to this thesis, social policy regulations at the European level were not really sought after by the main actors.

The packaging thesis and the cornerstone thesis contradict each other.

Introduction

With and through the integration thrust of the 1980s, a qualitative change in the interaction between economic and political actors has developed in Western Europe. The Single European Act, now more than a dozen years in force, marks the beginning of this process. The massive underestimation of the meaning of the Single Act on the part of most observers as well as actors involved in the integration process remains nothing less than astounding. In retrospect, the assessment of the actors who understood the Single Act as the first result of a far reaching dynamic has been confirmed. This is true on the economic level, where a fundamental structural change was set in motion in anticipation of the internal market, as well as on the political level. First, elements of integration projects that had been set aside were put back on the agenda in the 1980s, in particular the project of a European monetary union, which became the core of the next policy package, the Maastricht Treaty. The political dynamic after 1986 can also be traced back to changes in the decision-making process at European level that were effected through the Single European Act, especially the further erosion of the ‘veto culture’. In addition, the Commission was able to develop and maintain a strong, proactive role in many areas. Along with this came successive expansions of the circle of involved political actors. The new transnational forms of cooperation, without which the new integration dynamic cannot be explained, developed further. This did not lead to an end of the central position of the individual roundtables of industrialists in Brussels, but they increasingly became one voice among others.

Framing the question

The Single European Act of 1986 incorporated a new Article enshrining the Commission's power to enact technology policy. This chapter examines the roots of this change in the European political economy. We have focused on the creation of the European Strategic Programme of Research and Development (Esprit) in the early 1980s because we believe that it was through the creation of this programme that the Commission won the right to be active in the field of technology policy. The later inclusion of a specific article in the revised treaties can be seen as a case of formalizing an existing practice.

Furthermore, we will analyse this policy initiative in order to determine whether or not, in both its design and execution, Esprit may be said to constitute an incidence of technology corporatism, a concept that has already been briefly introduced in chapter 1. The issue that concerns us here is from where or from whom the new initiative in the realm of technology policy came and which interests were behind it. In this way it addresses the notion that political entrepreneurs heard the call of European transnational firms to improve the offer ‘Europe’ as a condition for their remaining in Europe – which was phrased more along the lines of ‘this is what needs to happen in our economic, social and political system if we are to be able to succeed in the international economy’.