Competing Models of European Environmental Governance
Abstract and Keywords
In the European Union, the system of environmental governance is the product of political action but not of political design. Instead of confronting the major questions of constitutional principle involved in the integration of European societies, the Monnet method involves policy-makers focusing on apparently technical matters of low politics in order to promote greater political cooperation among member states. Therefore, in some ways, environmental policy can be regarded as a textbook illustration of the Monnet method at work. With its background in the low politics of the harmonisation of technical standards within the single market, it spilled over into an institutionalised domain of policy in its own right. One important aspect of spillover is that it is no respecter of the distinction between primary and secondary rules.
The European system of environmental governance is, to paraphrase Hayek, the product of political action but not of political design.1 It borrows much from the Monnet method of European integration, as we saw in Chapter 13. This method is one of integration by stealth. Instead of confronting the major questions of constitutional principle involved in the integration of European societies, the Monnet method involves policy-makers focusing on apparently technical matters of low politics in order to promote greater political cooperation among member states. Indeed, in some ways environmental policy can be regarded as a textbook illustration of the Monnet method at work. With its background in the low politics of the harmonization of technical standards within the single market, it spilled over into an institutionalized domain of policy in its own right. Completely unanticipated in 1957, it moved from silence to salience within thirty years. This is not to say that conscious, intergovernmental choice was unimportant, but what governments negotiated in the treaty amendments were modifications of an existing status quo shaped by a functionalist logic.
One important aspect of spillover is that it is no respecter of the distinction between primary and secondary rules. In the Introduction we defined the distinction between these two sets of rules in terms of their scope. Primary rules concerned the regulation of a sphere of activity; secondary rules were rules for the making of rules. One feature of spillover, well illustrated in the case of environmental policy, is that it may easily take the form of a move from primary rules to secondary rules. This may happen either because there is dispute about whether the EU should be regulating in a particular area or regulating in a particular way, or because the practice of dealing with environmental problems creates a precedent in decision-making. It is not generally possible to say when an apparently routine matter of decision-making will turn into a constitutional issue.
The collapsing of this distinction between primary and secondary rules is one of the ways in which the member states are locked into the integration process. In the case of international environmental regimes outside the EU, for example the Convention on the Long Range Transport of Pollution, the institutional framework is one that a country can decide either to join or to leave alone. Within the EU, by contrast, countries are already locked into a shared system of authority, (p. 489 ) so that the emergence of unforeseen constitutional issues out of routine matters of decision-making is not one that is likely to have an easy answer. Moreover, this dynamism of rule development is part of the process. As the familiarly used bicycle metaphor is intended to underline, European integration depends upon a certain political momentum being maintained.
This form of political integration has left its mark on the decision-making style of the EU system of environmental governance. We saw in Chapter 13 that the Monnet method had led to one of a class of systems in which decision-making authority is not allocated in a zero-sum fashion between different levels of government but instead is shared.2 In such systems decision-making takes the form of requiring concurrent majorities of actors. Some implications of this decision-making structure were also spelt out in Chapter 13. National actors can block certain measures, and there is a constant tendency for member states to seek to displace their own agendas on to the European level. We also saw that horizontal complexity increases the number of ‘veto players’, that is actors whose agreement is required for a change in policy.3 The principle of concurrent majorities thus operates both vertically, in respect of the EU and the member states, and horizontally, in respect of policy actors at the European level itself.
The Monnet method has been highly successful. Perhaps no other way of securing European integration could have succeeded as well. This does not mean, however, that it marks out the path for the future. The Monnet method may have played an important part in the creation of the European system of environmental governance, but how far can it be expected to continue to play this role in the future? Certainly there are those who are sceptical of the view that the Monnet method is the most credible and plausible way to continue the general process of European integration. They argue that the revival of the impetus for European integration requires mass mobilization of a sort that Monnet himself shunned, along with a strong emphasis inside the EU on the need for greater economic security for Europe's citizens. Without this transformation in the logic of European integration, it is argued, it will be impossible to generate the political conditions that are necessary to sustain the European project.4
Can this line of reasoning be applied to EU environmental policy? Are we at a turning-point in the evolution of European environmental governance, and will the system need to be reshaped according to different principles from those on which it has been constructed so far? It is this question we seek to discuss in the final chapter.
To pose the question about the future of the Monnet method is not to ignore intergovernmental factors. The Monnet method is overlaid with an intergovernmental bargain—or rather, a series of intergovernmental bargains. Indeed, one of the reasons why the Monnet method has successfully shaped EU governance is that it did not confront the large constitutional questions that European integration could be said to raise. In that sense, it sought not to overcome the authority of the nation state, but to persuade national governments to share their authority (p. 490 ) in the common interest. There is a sense in which the functional approach presupposes the central position of the state that is such an important assumption of the realist tradition. Were state sovereignty not so important, the Monnet method would not have to take such an indirect route to integration. When we reflect upon the inadequacies of the Monnet method, therefore, we are implicitly acknowledging the continuing importance of the nation state.
Pathologies of the Status Quo
In a system like that of the European Union, where not only are the rules being made quickly but the rules for making rules are also changing rapidly, there are plenty of opportunities for policy and procedural wrangling, as we have already documented in a number of instances. Super-majoritarian systems are well known to have high transaction costs attached to them, most notably as the decision rule tends to unanimity.5 Procedural wrangling adds to such transaction costs by creating disputes not just about the substance of the measure, but also about the terms and conditions under which the measure is to be taken.
The theory of social choice suggests that, as actors with diverse policy positions obtain a share of decision-making power, so the chances of policy change go down.6 One typical example of such delay, in addition to the cases we have already discussed, is the development of a proposed landfill directive. In that case the crucial issue was a provision that would have enabled member states with a low density of inhabitants to exempt smaller landfills (favoured by Portugal and Ireland), an exemption to which the European Parliament was opposed. Thus, requiring simultaneous agreement between the Council and the Parliament resulted in a situation in which it is difficult to move from the status quo.
When we turn to the functional component of the concurrent majority, one feature in particular is evident: namely that environmental policy involves coordination with other policy sectors, most notably industry, transport, and agriculture. Thus, an environmental policy taken on its own may secure the reduction in harmful emissions from individual vehicles, but if transport policy is leading to more vehicles being put on the road, then the gain at the individual level is offset by the increase in total emissions arising from the volume increase, a phenomenon that has been observed in respect of nitrous oxide emissions from cars, for example. Since, at the European level, DGs are the guardians of their sectoral interests, it is hardly surprising that sectoral complexity makes for difficult decision-making in institutional terms.
By contrast, environmental policy-makers will also want to be seen to be supporting their own functional constituency, a trend reinforced in the case of (p. 491 ) DG XI by the fact that a number of the officials clearly have a commitment to environmental protection that is personal as well as professional. Similarly, there are officials in DG XI who will volunteer the thought that no one in agriculture is willing to talk to anyone about the environmental problems that the CAP causes.
Can we characterize the decision-making style that emerges from this institutional process? One important feature of it is that is it difficult for policy actors to adopt what Scharpf terms a ‘problem-solving’ mentality as distinct from a ‘bargaining’ mentality. In this sense, the attempt to create a discourse of ecological modernization around which policy could be organized and discussed has failed. There is simply too much heterogeneity of interest (especially arising from different stages of economic development) for there to be a consensus on the priority to be given to environmental measures. Moreover, even if it is true in the aggregate that environmental protection and economic development pull in the same direction, there is too much conflict in the particular case for the tension to be easily eliminated.
One consequence is that over time the development of environmental policy tends to follow the pattern of immobilisme punctuated by activism. Between 1982 and 1992 there was an upsurge of activism in which many environmental measures were passed, partly as a consequence of the need to harmonize environmental measures in the context of the internal market, and partly because of the high salience that the environment had as an issue among European publics and governments. Despite some consolidation and advance since 1992, the scale and pace of development has slowed down considerably, and some high-profile measures have been stalled.
Moreover, there are still strong formal constraints at the European level limiting the range of measures that can be adopted. The EU is limited in the amount of taxation that it can collect, and its principal source of revenue is from VAT proceeds. This means that it cannot impose pollution taxes as an instrument of policy, and under the Treaty on European Union any environmental measures that involve fiscal considerations have to be agreed by all member states before they can be passed. If we contrast this restriction of powers with those that obtain in federal political systems like Germany or the USA, it is clear that there is a significant limitation built into the development of environmental policy at the European level. Hence, although we can properly talk of an increase in the size, scope, and stringency of European environmental legislation, there are still important issues that remain outside the sphere of European control.
Suppose that this characterization of the decision-making pattern as it has historically developed is accepted. Are there any other principles on which we could imagine the European system of environmental governance being constructed? One possible way of identifying such principles is to hypothesize what would happen to environmental policy in a European constitutional convention. It is to this hypothesis that we now turn.
(p. 492 ) A Constitutional Convention on Environmental Governance
Suppose that the process of European integration has reached the point at which the Monnet method is exhausted. Integration by stealth is no longer a possibility, and any further integration depends upon agreement among political representatives of the peoples of Europe who are to decide in a constitutional convention among themselves the principles and rules that will govern the basic terms of their association.7 What agreement might we expect to emerge from such a process?
In coming to any such agreement, let us suppose that the delegates are free from the constraints of history. That is to say, they need not assume that a rule or practice should be respected simply because it exists. In other words, the whole purpose of a constitutional convention would be to sift arguments and establish the principled basis for European environmental governance in terms that all could accept as impartial and in the general interest. Burkean appeals to inherited prescriptive rights or integrationist appeals to the acquis would not of themselves count as an argument in such an assembly.8
In this sort of situation, what principles of environmental governance would be acceptable? The first point at issue would concern the legitimacy of intervention in the single market for the purposes of environmental protection. As we have seen, there are not only complementarities but also conflicts between the rules needed for a single market. From one point of view, it is not surprising that there is a potential conflict between a liberalizing economic policy that lays stress upon the deregulation of markets on the one hand and the requirement of environmental policy on the other. One standard justification for having a public policy on the environment is that regulatory measures are needed in order to cope with market failures. From this point of view, environmental pollution is an economic externality in which the costs of production or consumption are not fully internalized to the transactions of vountarily contracting parties.
In these circumstances, a case for public intervention exists on grounds of economic efficiency alone. Correcting for externalities by forcing producers to internalize the costs will lead to a better use of resources. On such liberal grounds, the case is especially strong for the regulation of international environmental pollution by the EU, since its boundaries are extensive enough to ensure that externalities are internalized across the full extent of its authority, whatever national boundaries are involved.
In principle, there are a number of ways in which the internalization of externalities might take place: through a clearer specification of property rights enforceable at law, through voluntary agreements among affected parties, or through public intervention in the form of administrative regulation or economic instruments. Cutting a very long story very short, a constitutional convention is likely to arrive at a justification for public intervention by noting that the property rights solution (p. 493 ) is either incomplete (relevant property rights cannot be fully specified) or infeasible (no one can plausibly own the European air shed or the Mediterranean sea), whereas the use of voluntary measures is subject to the problem of free-riders and the danger that scrupulous firms will be exploited by the unscrupulous. In practice, then, environmental protection legitimates some form of public intervention to close the gap between internal and external costs.
What form would the intervention take? It is common, though by no means universal, in neo-classical treatments of the externality problem to underline the extent to which regulation by means of economic instruments is superior, by the test of economic efficiency, to regulation by means of administrative rules. Such economic instruments include: taxes on emissions, usually by volume emitted; refund schemes for returnable items, ranging from cars to bottles; taxes on polluting substances, for example fuel oil or pesticides; and so on. The arguments favouring such measures are many and varied, depending on the case at hand. Such measures allow greater freedom to producers to find least-cost solutions to their pollution problems than do uniform emission limits. Economic instruments such as taxes on pesticides are likely to be more effective at dealing with dispersed, non-point sources of pollution. And where pollution arises from consumption rather than production externalities, economic instruments are often the only effective instrument. In this context, the important point is not that one would accept in every case the arguments for the superiority of economic instruments over direct regulation: rather, it is that there would be no reason of principle to rule out the admissibility of such instruments at the European level. The suitablility of economic instruments compared with direct regulation is something that should be decided on the technical merits of the argument when applied to a particular problem.
Moreover, if international conflict is to be constrained by the liberal policy of free trade within the boundaries defined by the treaty parties, as was the idea of the original Monnet method, then it would seem that a liberal approach to pollution control would be a natural corollary, and perhaps a way in which a constitutional convention would want to develop the argument. At present the restriction on the use of tax instruments by the EU is one that can only be explained by the history of European integration rather than justified by appeal to principles that could gain consent in a European constitutional convention.
However, if this is the way that members of a constitutional convention would think about environmental policy, we need to note that a number of conditions must be met if public intervention is to be successful. In outline, these conditions are that public intervention needs to be at the right level (i.e. that the standard-setting or regulatory authority needs to operate on a scale such that major externalities can be internalized), and to the right degree (levels of regulation need to be adjusted with respect to competing values).
One principle of task allocation within a multi-level system of governance is that of subsidiarity. This principle already finds a place within existing EU legislation within the Treaty on European Union:
As stated in the Treaty, this principle involves at least two separate elements: the notion that member states cannot sufficiently achieve the objectives of a given environmental policy on their own, and the notion that the objectives can be better achieved by action at the European level. The first element gives the principle a bias to the local, for if the objectives can be achieved ‘sufficiently’ then there is no case for European action, even if European action would achieve the objectives more completely or satisfactorily.
(p. 494 ) In areas which do not fall within its exclusive competence, the Community shall take action, in accordance with the principle of subsidiarity, only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community.9
It is not clear that a constitutional convention would accept this bias to the local. To be sure, within an ongoing process of integration of the sort implied by the Monnet method, there is no point in disturbing the activities of the nation state provided that goals are being adequately achieved by action at the national level. However, if the provision of environmental benefits can be better achieved by assigning standard-setting responsibility to a higher level, then there would appear to be an argument for doing that. In other words, the constitutional convention might accept not the principle of subsidiarity, but rather what we might term a principle of functional effectiveness, namely that the appropriate level at which to set standards is one at which the externalities are internalized to the boundaries of the administering authority.
Set against the principle of subsidiarity in this way, the principle of functional effectiveness would seem to be a centralizing principle. It removes the bias to the local implied by the sufficiency clause of the principle of subsidiarity. However, set against the principle of the acquis communautaire, it might seem to be a decentralizing principle, since it would not license European levels of standard-setting in cases where only local public goods were at issue.
In concrete terms, then, application of the principle of functional effectiveness would imply much stronger competence in those fields of policy (acidification, global climate change, and ozone depletion) in which there are problems of collective action at a European level combined with less authority in relation to those issues that are essentially concerned with local public goods, including bathing water and drinking water quality. Moreover, to say that policy competence should be lodged more firmly at the European level for certain matters would not of itself imply a distinction among instruments. So the principle of functional effectiveness would reinforce our conclusion when discussing the basic logic of public intervention.
Setting regulation appropriately relative to other values raises more problems. The principal question here is whether the stringency of an environmental standard is justified in terms of its cost, particularly in the light of scientific and other evidence about effectiveness. Given the diversity of economic circumstance and the stage of development of member states, the most probable principle (p. 495 ) at a constitutional convention would be a prohibition (a) against poorer states simply displacing some of their development costs on to richer states in the form of cross-boundary pollution, and (b) against richer states imposing higher standards in local public goods than poorer states would choose for themselves. For those matters in which European collective action was required, most importantly issues of global climate change, it is difficult not to imagine that the price for agreeing to European powers would be more equitable cost-sharing arrangements.
So far we have considered the hypothetical deliberations of our constitutional convention on environmental governance purely in terms of a theory of the efficient functioning of markets. However, in the course of its development, EU environmental policy has gone way beyond what would be strictly necessary in order to ensure that markets function efficiently. It has developed regulations to conserve natural environments for aesthetic reasons (for example, the protection of countryside from large project developments through environmental impact assessments) as well as to protect some species from human predation (for example, the birds directive). These developments reflect the important political functions that environmental policy performs, in particular the legitimation of EU institutions vis à vis the citizens of Europe by providing some protection for values that are not purely economic.
In this context, some of the simpler prescriptions that emerge from the economic analysis of environmental policy functions may need revision. Although it is possible to argue within the economic framework that bathing waters or drinking waters are essentially local public goods, there will be some who maintain at a constitutional convention that the ability of children to swim in clean seas or drink wholesome water should be regarded as a right of European citizenship, and not an accidental by-product of the country in which one lives. This is in effect a political argument about the constitutional status of principles for the assignment of functions, and in particular about whether considerations deriving from a wider European conception of citizenship should be a reason for requiring at least some sharing of authority within a system of multi-level governance between member states and the EU.
It is impossible to say how such a dispute might be resolved at a constitutional convention. The opportunistic policy-making of the Commission in the 1970s which led to the directives on water quality might be regarded as a breach of justifiable constitutional principle, in line with the economic conception; or they might be regarded as a happy accident for European citizenship. Just as importantly, it may be that pragmatic considerations enter the picture, not least the thought that it is stretching the attention span of the European authorities too much to give them powers over local public goods when important issues of global and continental concern need addressing.
The issue does, however, highlight one question that would be bound to emerge at a constitutional convention, namely that of how political disputes would be solved within the system of shared authority. Here there are the well known problems of (p. 496 ) the democratic deficit. As we saw in Chapter 13, one of the differences between the Europeanization of policy and the earlier nationalization was that environmental policy was not located within conventional systems of democratic competition. The EU lacks the apparatus of party competition, a European-wide party system, and an encompassing political culture that are some of the preconditions of democratic decision-making within the nation state.
However, this does not mean that democratic accountability has been entirely absent from EU environmental policy. Indeed, there is a good argument for saying that the European Parliament has played a more interventionist role in the setting of environmental standards than the majority of national parliaments. Within national systems the setting of standards is essentially a bureaucratic matter, and where it involves parliaments is normally within the system of party discipline under which national parliaments operate. Because there is a separation of powers horizontally within the EU, a separation that the Treaty of Amsterdam has strengthened by making the co-decision procedure the norm for European legislation, the European Parliament has played an active role, as the examples of car emissions and the difficulties of securing a landfill directive go to show.
The problem to which this gives rise, as we have seen, is that it is just this separation of powers that creates the conditions for policy stagnation, with there being no alternative that is mutually acceptable to all the decision-making bodies. However, it is difficult to see a solution to this problem even if we look at it in the context of reasoning at a constitutional convention. It is difficult to conceive of any European-level policy process that did not institutionalize the member states' interests as well as give a role to directly elected members and maintain the separation of powers between the democratically chosen politicians and the appointed commissioners. In so far as the separation of powers is part of the problem rather than part of the solution, the convention would have to face the implications of this built-in conflict.
One way of approaching the issue is to stress the need to strengthen the conditions under which policies can be debated and criticized. Thus, in the setting of standards, a constitutional convention would be likely to wish to uphold and improve transparency and accountability in the process. At a minimum, this would mean that the grounds on which the position is being taken by each body should be made clear, and that there should be adequate opportunities for critical discussion and debate. It would also almost certainly mean ensuring that the the European Environment Agency had sufficient resources to gather information and evidence relating to the environmental policy performance of member states. The European public interest can be served only by having reliable sources of information by reference to which policies and proposals can be tested.
Putting these points together, we might expect a European constitutional convention on the environment to agree on a number of principles that had not emerged through the Monnet method, including the strengthening of the regulatory powers of the EU to protect the environment, a shift of some powers from the national (p. 497 ) level to the European level, and greater transparency and accountability in the making of decisions. It is also possible that there would be a quid pro quo for the nation states in the form of a constitutional guarantee that the regulation of certain local public goods would not be subject to European authority.
We have said that the deliberations of our hypothetical constitutional convention would be independent of the constraints of history. But how free are we to assume this? The Monnet method, for all its faults, did solve a problem that other constitutional designs could not tackle. Europe could not live with its sovereign nation states, and it could not live without them: bypass the problem by stealth, and it may eventually go away. The legacy of history, including its pathological effects on the making of environmental rules, is the price we may have to pay for the success of the European Union in bringing integration to previously war-torn societies.
In any case, the question of the relationship between history and principle may not matter. In a way, the most striking thing about the arguments of principle is that they issue in conclusions many of which are already implicit in the evolution of European environmental governance under the Monnet method. To be sure, there are some significant divergences. The Monnet method has almost certainly given more power to the nation states, particularly in the field of environmental taxation, than a constitutional convention would have allowed, and the progress towards greater transparency and accountability has been more hesitant than democratic principle would suggest. However, the thought-experiment suggests not a radical break with the past, but a summons to the European system of environmental governance to achieve ideals that are implicit in its current practices, so that it can become an open and transparent system of decision-making, performing the task of protecting a priceless environmental heritage for all of Europe's citizens.
Notes to Chapter 15
(1.) Cf. F. A. Hayek, Law, Legislation and Liberty (London: Routledge, 1982), ch. 2.
(2.) F. W. Scharpf, ‘The Joint-Decision Trap: Lessons from German Federalism and European Institutions’, Public Administration, 66:3 (1988), pp. 239–78, at 242.
(3.) G. Tsebelis, ‘Decision Making in Political Systems: Veto Players in Presidentialism, Parliamentarianism, Multicameralism and Multipartyism’, British Journal of Political Science, 25:3 (1995), pp. 289–325, at 301
(4.) J. Hayward, ‘Has European Unification by Stealth a Future?’ in J. Hayward (ed.), Élitism, Populism, and European Politics (Oxford: Clarendon Press, 1996), pp. 252–7.
(5.) B. Barry, Political Argument (London: Routledge and Kegan Paul, 1965), chs. 14 and 15.
(6.) Tsebelis, ‘Decision Making in Political Systems’, pp. 308–13.
(7.) For contrasting uses of this general contractarian approach to the EU, see A. Follesdal, ‘Democracy, Legitimacy and Majority Rule in the European Union’, in A. Weale and (p. 498 ) M. Nentwich (eds.), Political Theory and the European Union (London and New York: Routledge, 1998), pp. 34–48; and H. Abromeit, ‘How to Democratise a Multi-Level, Multi-Dimensional Polity’, in A. Weale and M. Nentwich (eds.), Political Theory and the European Union (London and New York: Routledge, 1998), pp. 112–24.
(8.) Compare B. Barry, Justice as Impartiality (Oxford: Clarendon Press, 1995), p. 6.
(9.) Treaty on European Union, Article 3b.