THE FEDERALIST, YEAR LXII, 2020 THE FEDERALIST, YEAR LXII, 2020 Editor: Giulia Rossolillo The Federalist is published under the auspices of the Luciano Bolis European Foundation and the Mario and Valeria Albertini Foundation by Edif, via Villa Glori 8, 27100 Pavia, Italy. Single annual issue. Subscription rates: Europe 35 euro; other countries (by air mail) 50 euro. All payments should be made by bank transfer to Edif: IBAN IT71W0306909606100000007243. www.thefederalist.eu YEAR LXII, 2020 2 CONTENTS Time to Switch to the Constituent Strategy p. 4 Europe: the Testing Ground for a New Model of Politi- cal Community » 8 GIULIA ROSSOLILLO, The Judgment of the German Con- stitutional Court: a Warning About the Future of the Process of European Integration » 15 MASSIMO MALCOVATI, Green Deal, Digital Future, New Industrial Strategy: What is Needed to Ensure the Rebirth of European Economy? » 24 GIOVANNI SALPIETRO, Political Power: From the Nation State to the Federal State » 35 UMBERTO MORELLI, Power Politics. The European Un- ion and the International System » 44 LUCA LIONELLO, The Concept of State and What It Means for the Process of European Integration » 61 GIULIA ROSSOLILLO, Sovereignty » 67 SERGIO PISTONE, Political Realism » 76 STEFANO CASTAGNOLI, Responsibility and Politics (and the Problem of Power) » 83 NOTES 9th May 1950. Jean Monnet: the Revolution of Europe- an Sovereignty (Anna Costa) » 89 Europe and the Language of Power (Paolo Milanesi) » 96 Anti-Europeanism in American Politics Is here to Stay. Euorope Must Acknowledge the Fact and React (Francesco Violi) » 103 Mercosur: a Future in Balance (Stefano Spoltore) » 107 Belarus, Russia and the European Union (Stefano Spol- tore) » 118 The Pandemic Crisis and Europe (Franco Spoltore) » 125 3 DOCUMENTS Applying the ESCS Model to Give the EU Fiscal Power (Giulia Rossolillo) » 131 The Financing of the European Union: a Proposal for Treaty Reform to Give the EU True Fiscal Capac- ity (Giulia Rossolillo) » 135 THIRTY YEARS AGO Federalism and Human Emancipation (Francesco Ros- solillo) » 144 The journal index can be consulted at the website: www.thefederalist.eu 4 Time to Switch to the Constituent Strategy Today, seventy years since the start of the process of European inte- gration, Europeans find themselves faced with a situation in some ways similar to the one created in the wake of the Second World War. In recent months, the Covid-19 pandemic has brought firmly to the fore, once again, the need to replace national sovereignties with a newly cre- ated European sovereignty. It is therefore very important, as we mark both the 70th anniversary of the Schuman Declaration and 40 years since the founding of the Crocodile Club, to recall the strategies es- poused by the protagonists of those two historic events, respectively Jean Monnet and Altiero Spinelli. Expressing two different visions of the process of the European integration — the gradualist as opposed to the constituent strategy —, their battles allow us to interpret the current stage in this process and understand the steps that need to be taken. Jean Monnet must be acknowledged for having grasped a fundamen- tal concept, namely that the only way to prevent Europe from returning to the conflicts of the past was to identify a common European interest that could be embodied by supranational institutions capable of taking autonomous decisions, independently of their member states. This was the thinking that led to the birth of an organisation that, in addition to pooling the management of France and Germany’s production of coal and steel (and thereby symbolising Franco-German reconciliation), by taxing this production, also found a way to partially self-fund its opera- tions. However, the European Coal and Steel Community (ECSC) was a body with limited scope, and this fact, together with the collapse of the European Defence Community (EDC) project, set the stage for the creation of another organisation, the European Economic Community (EEC), which, in line with Monnet’s idea that Europe could not be built overnight, had none of the independence of the ECSC. Indeed, follow- ing the collapse of the EDC and European Political Community (EPC) projects, which would have led to a true European political union, the 5 signatory states of the 1957 EEC Treaty decided that assigning self-fi- nancing powers to an organisation with aims as broad as those set out in this new Treaty would be both too dangerous and too restricting of their sovereignty. In short, the EEC was born of the idea that economic inte- gration was destined to evolve gradually and naturally, through small steps, into political integration. In Albertini’s words, “Monnet’s strategy has the advantage of being able to engage the active forces within nations without first requiring constitutional changes. Therefore, as long as the European objectives on the table do not require a transfer of sovereign powers, the member states can continue to apply, in full, their normal European policy.” On the other hand, Albertini explained, in situations where the pursuit of European objectives demands the transfer of sovereign powers, gradu- alism offers no solutions, and the only valid strategy is that of Spinelli. In short, while gradualism can create the conditions for the achieve- ment of an objective, the actual realisation of that objective demands a constituent decision, involving a transfer of sovereignty. As Albertini said, “Day by day, European integration, as it develops, creates a plural- istic European society, in other words, it destroys the exclusive national society which is the very basis of the nation-states. All this, however, rather than a gradual shift, must actually be understood as the prepa- ration for an acute moment of transition. First, because, by definition, there can be no gradual transition to federal sovereignty, and second, because European integration by generating a large economy, gives the national powers a semblance of vitality, but this is only a prelude to their demise. As long as the states are confronted with European-level problems that they can easily solve together through collaboration (...), then they retain some power. But when they are faced with bigger prob- lems whose joint solution demands a European government, then they suddenly find they are powerless”. The relationship between gradualism and the constituent strategy is the key issue facing the process of European integration today. On the one hand, the ongoing public health emergency and its economic consequences are making the member states, or some of them at least, aware of the absolute need to cooperate closely in order to contain the crisis and avoid the collapse of the Union; on the other, they are ex- posing the limits of gradualism, as they are showing the clear need to create — once the acute phase of the crisis is over — a Union that is no longer dependent on the member states, but self-determining and therefore sovereign. 6 The recent Franco-German proposal to create a 500-billion-euro re- covery fund financed by bonds issued by the European Commission, followed by the Commission’s own proposal to create a fund (Next Generation EU) whose financing would be linked to the next Multian- nual Financial Framework, thus mark the absolute limit beyond which gradualism can go no further. The current crisis has at last made it pos- sible (for Germany in particular) to overcome the taboo of joint debt creation, and allowed the question of increasing the EU budget and creating new own resources to be placed firmly on the agenda. How- ever, the need (imposed by the still prevailing gradualist approach) to proceed exclusively using the existing instruments means that this debt can, for the moment, be guaranteed only by a budget still financed largely by member states’ contributions, or using resources whose ceil- ing is still decided by the states unanimously. Clearly then, whereas the states, in the present emergency situation, are likely to agree to guaran- tee a debt issuance still based on confederal mechanisms and on coop- eration between sovereign nation states, once the emergency is over, the question of the need to endow the Union with the ability to finance itself independently of the states, and thus to guarantee the issuance of a true common debt, is bound to arise. This step must necessarily be based on a decision of a constituent nature, in other words a Treaty amendment that will alter the very nature of the Union, changing it from a con- federal organisation into one that is capable of exercising its functions independently of the member states, and is therefore sovereign in its sphere of jurisdiction. In Albertini’s terms, we can say that the present public health crisis has created the conditions for the acute moment of transition, when the various forms of voluntary cooperation between the states, based on the existing Treaties, will have to make way for European sovereignty. The need for this transition, and with it the end of gradualism, emerg- es clearly both from the Commission proposal and from the words of Angela Merkel in an interview she gave on June 26, 2020. While the Commission proposal envisages the creation of new own resources in the coming years, and therefore implies the need to equip the EU with instruments capable of ensuring that these resources come from real European taxes rather than, as is currently the case, harmonised na- tional taxes, Angela Merkel, went further, explicitly raising the issue of the Union’s need to levy taxes, and therefore of the need to amend the Treaties to this end. Clearly, creating a fully-fledged European federation will take time, 7 just as creating the US federation did, and it will be the final outcome of a process of which giving the EU powers of taxation, and thus fiscal independence, will be only the start.