The
Dilemma
of
Being
a
Free
Market
Classical
Liberal
in
the
European
Parliament


The
European
Journal,
February
2007



In
 May
 2005,
 I
 became
 a
 Member
 of
 the
 European
 Parliament.
 As
 someone
 who
 believes

that
 competition
 and
 open
 markets
 are
 the
 best
 way
 to
 generate
 wealth
 and
 economic

growth,
 I
 was
 quite
 sure
 that
 my
 free
 market,
 classical
 liberal
 instincts
 would
 guide
 my

actions
when
making
European
legislation.
Alas,
it
is
never
so
simple
in
practice.



I
entered
the
European
Parliament
just
as
the
French
and
the
Dutch
were
rejecting
the

proposed
 European
 Constitution.
 While
 the
 French
 and
 Dutch
 ‘No’
 votes
 came
 about
 for

different
reasons,
they
had
two
constitutional
objections
in
common.
First,
the
electorates

were
 concerned
 about
 further
 enlargement
 and
 the
 possibility
 of
 Turkey
 becoming
 an
 EU

member.
Second
and
more
importantly,
they
voted
against
the
‘one
size
fits
all’
mentality
of

those
who
want
further
European
integration.



With
high
unemployment
and
slow
growth,
the
French
were
attracted
to
the
arguments
of
a

‘No’
 campaign
 which
 worried
 that
 things
 would
 get
 worse
 economically
 if
 Europe
 adopted

more
liberalisation
and
accepted
a
further
influx
of
‘Anglo‐Saxon’
ideas.
Many
Dutch
voted

‘No’
 to
 the
 Constitution
 for
 the
 opposite
 reason:
 the
 fear
 that
 Europe
 was
 losing
 its

competitiveness,
 and
 that
 there
 would
 be
 more
 job
 losses
 if
 the
 Union
 were
 to
 uniformly

adopt
the
social
model
that
had
led
to
such
high
unemployment
in
France
and
Germany.
In

addition,
 many
 Dutch
 felt
 that
 they
 saw
 little
 benefit
 in
 the
 Netherlands
 being
 a
 net

contributor
to
an
EU
that
was
looking
to
expand
further.




For
 a
 fleeting
 moment,
 the
 rejection
 of
 the
 Constitution
 by
 two
 of
 the
 Union’s
 founding

members
 gave
 us
 hope
 that
 Europe
 could
 finally
 emerge
 from
 ever
 closer
 convergence

towards
a
cross‐continental
socialist
model
and
that
we
could
start
rebuilding
the
Union
as
a

looser
 confederation
 of
 sovereign,
 free
 trading
 nations.
 We
 allowed
 ourselves
 to
 glimpse

again
a
positive
vision
for
Europe
akin
to
the
vision
first
articulated
by
Margaret
Thatcher
in

Bruges.



We
imagined
that
a
new
European
framework
could
be
constructed,
free
of
the
‘one
size
fits

all’
approach,
enabling
the
French
to
adopt
the
social
model
they
chose,
while
allowing
more

classically
liberal
nations
like
the
Netherlands
and
the
UK
to
run
lighter,
deregulated
social

and
economic
models.
Sovereign
nations
would
be
allowed
to
give
consumers
more
choice

by
opening
their
markets
to
goods
and
services
from
other
countries,
to
maintain
their
own

defence
and
criminal
justice
policies,
but
there
would
be
no
need
to
force
others
to
follow

their
lead.
Under
this
approach,
Europe
would
liberalise
gradually,
as
governments
woke
up

to
the
benefits
gained
by
citizens
of
neighbouring
countries
from
the
pursuit
of
enlightened

free
market
policies
by
other
national
governments.



To
those
who
believe
in
national
sovereignty,
it
is
a
deeply
attractive
approach.
The
French

would
 be
 able
 to
 protect
 their
 vineyards
 and
 film
 industry;
 the
 Germans
 their
 restrictive

practices;
the
British
their
trading
links
with
the
Commonwealth;
the
Estonians
their
flat
tax,

etc.
 The
 best
 policies
 would
 be
 copied,
 and
 since
 classically
 liberal
 policies
 are
 the
 best,

Europe
 would
 enter
 a
 new
 age
 of
 individual
 liberty
 coupled
 with
 national
 sovereignty.
 So

much
for
the
vision.



Back
 in
 the
 real
 world,
 this
 laissez‐faire
 approach
 is
 of
 course
 at
 odds
 with
 the
 way
 the

European
Single
Market
has
been
implemented
over
the
past
decade.
The
rejection
of
the

Constitution
 does
 not
 fatally
 undermine
 any
 of
 the
 Treaties
 which
 imposed
 the
 Single

Market
 and
 subsequent
 layers
 of
 bureaucracy,
 legislation
 and
 law
 in
 the
 form
 of
 a
 central

legal
jurisdiction
across
the
European
Union.
As
an
MEP,
I
still
vote
each
month
on
a
list
of

measures
 which
 weigh
 down
 the
 continent
 in
 red
 tape
 in
 the
 service
 of
 a
 centralised

European
political
ideal
dreamed
up
in
the
aftermath
of
the
Second
World
War.



This
situation
presents
me
with
a
dilemma:
do
I
try
to
keep
faith
with
a
vision
of
a
Europe

based
on
a
loose
confederation
of
sovereign
states,
or
do
I
work
within
the
framework
of
the

institutions
as
they
are
today?
Given
that
foreign
socialists
already
use
European
powers
to

coerce
 my
 countrymen,
 am
 I
 entitled
 to
 use
 European
 powers
 to
 do
 the
 opposite?
 Is

‘coercive
 liberalisation’
 legitimate,
 even
 if
 I
 would
 ideally
 like
 national
 governments
 to
 be

able
to
liberate
their
own
peoples?
This,
then,
is
the
dilemma
of
the
classical
liberal
who
sits

in
the
European
Parliament.



I
 have
 discussed
 the
 dilemma
 with
 some
 notable
 present‐day
 libertarian
 thinkers.
 Some

believe
that
it
is
wrong
to
try
to
use
government
as
a
tool
to
foist
freedom
upon
a
society.

Llewellyn
 H.
 Rockwell
 Jr.
 of
 the
 US‐based
 think
 tank
 the
 Ludwig
 Von
 Mises
 Institute
 has

argued
that
politicians
“are
widely
under
the
impression
that
the
liberty
they
seek
for
their

societies
can
be
imposed
in
much
the
way
that
socialist
systems
of
old
were
imposed
...
[but

this]
...
will
replace
one
bad
form
of
central
planning
with
another.
Genuine
liberty
is
not
just

another
 form
 of
 government
 management.
 It
 means
 the
 absence
 of
 government

management.”
 The
 late
 Chris
 Tame
 of
 the
 UK‐based
 think
 tank
 the
 Libertarian
 Alliance

likewise
 advised
 me
 that
 any
 imposed
 liberalisation,
 if
 public
 sentiment
 is
 against
 the

politicians,
 would
 never
 stick.
 He
 held
 the
 view
 that
 we
 should
 spread
 the
 idea
 of

competition
and
of
free
markets
generally,
and
then
let
people
demand
it
through
the
ballot

box
from
their
own
national
governments.
His
view
was
rooted
in
the
faith
that
over
time,

free
market
ideas
will
win
out
and
that
democracy
will
deliver
the
reforms
needed
to
deliver

a
free
society.



If
you
are
an
intellectual
concerned
with
the
propagation
of
ideas,
this
approach
is
certainly

easier
to
adopt
than
if
you
are
politician
with
shorter
horizons
and
vested
with
the
power
to

vote
 on
 new
 laws
 today.
 While
 in
 theory
 I
 can
 justify
 the
 idea
 of
 the
 French
 and
 German

governments
wasting
their
taxpayers’
money
on
subsidising
state
owned
companies
so
they

can
compete
in
he
British
market,
I
would
find
it
hard
to
explain
this
position
to
constituents

of
mine
put
out
of
work
by
such
‘unfair’
competition.
When
I
see
the
French
company
EDF

allowed
 to
 own
 significant
 assets
 in
 the
 UK
 while
 British
 companies
 are
 prevented
 from

penetrating
 the
 French
 energy
 market,
 I
 find
 myself
 forced
 back
 to
 15
 In
 Depth
 February

2007
a
position
of
arguing
for
a
‘level
playing
field’
and
a
harmonised
European
market.



My
 British
 MEP
 colleague
 Chris
 Heaton‐
 Harris,
 who
 sits
 on
 the
 European
 Parliament’s

Internal
Market
and
Consumer
Affairs
committee,
takes
a
similar
view.
He
says,
“Since
we
do

not
have
perfect
liberalisation
we
should
take
what
liberalisation
we
can
get.
We
have
to
be

practical
and
separate
theory
from
practice.”
After
all,
the
EU
has
delivered
liberalisation
in

telecoms
services
and
is
attempting
to
open
up
the
postal
and
energy
markets.



While
 it
 may
 well
 be
 that
 we
 will
 never
 be
 able
 to
 produce
 a
 perfectly
 free
 marketplace

across
Europe,
does
that
still
mean
that
we
should
not
use
our
powers
to
try
to
get
one?
If

we
want
to
see
liberty
extended
as
far
and
wide
as
possible,
why
not
use
the
EU
as
a
tool
for

extending
 liberty,
 especially
 since
 economic
 freedom
 is
 then
 codified
 into
 law?
 And
 just

because
the
French
and
German
governments
try
to
deny
their
consumers
the
same
choice

and
economic
freedom
that
I
enjoy
in
the
UK,
is
it
not
my
duty
as
an
MEP
to
stand
up
for

what
I
see
as
the
best
interests
of
French
and
German
citizens?
If
I
am
asked
to
vote
on
a

directive
 that
 extends
 economic
 freedom
 and
 consumer
 choice,
 am
 I
 really
 going
 to
 vote

against
it
in
the
hope
that
the
citizens
of
that
country
will
eventually
elect
a
government
that

introduces
economic
freedom
of
its
own
volition?



One
subscriber
to
the
view
that
you
use
all
the
power
at
your
disposal
to
spread
freedom,

even
if
the
institutions
of
government
are
not
ideal,
is
Professor
Philip
Booth
of
the
Institute

of
Economic
Affairs.
He
states
that,
“most
classical
liberals
are
happy
to
have
constraints
on

the
activities
of
sovereign
governments
(whether
they
are
constitutional
or
external).”
Since

there
is
no
perfect
set
of
institutions
for
promoting
liberalism,
he
believes
this
leaves
us
with

two
pragmatic
positions:
“(a)
We
try
to
create
institutions
that
will
help
us
spread
liberty
and

destroy
those
that
are
a
restraint
on
that
process
‐
and,
no,
it
does
not
matter
that
the
ones

that
you
create
over‐rule
illiberal
sovereign
government;
(b)
Where
we
have
institutions
that

we
might
be
better
without
(such
as
the
EU)
it
is
still
very
helpful
if
some
politicians
at
least

try
to
do
their
best
with
those
institutions
(otherwise
somebody
else
will
use
them
for
malign

purposes).”



Professor
 Booth
 feels
 that
 classical
 liberals
 “should
 not
 worry
 about
 the
 EU
 marauding

around
 imposing
 liberalism
 in
 the
 very
 few
 areas
 it
 does
 [since]
 if
 it
 is
 overruling
 sovereign

governments,
it
is
liberalising
the
people
that
those
governments
are
oppressing.”
While
he

agrees
 that
 it
 is
 very
 difficult
 to
 impose
 liberalism
 in
 practice,
 particularly
 on
 reluctant

governments
and
populations,
he
sees
nothing
wrong
in
trying.
Writer
Rachel
Tingle
points

out
 that
 separate
 national
 governments
 often
 coercively
 impose
 liberalisation,
 and
 that
 it

often
works.
Like
every
privatisation
that
ever
happened,
initially,
people
oppose
it,
but
then

after
it
starts
to
work,
they
are
glad
that
it
was
imposed.
If
you
wait
for
public
sentiment
to

change
 before
 you
 actually
 change
 anything,
 you
 are
 liable
 to
 wait
 forever.
 People
 are

ultimately
grateful
to
bold
leaders
who
understand
but
are
prepared
to
override
the
fears
of

people
who
cling
to
the
status
quo.



Libertarian
activist
Paul
Coulam
has
pointed
out
that
this
debate
is
not
confined
to
Europe.

In
the
USA,
economic
liberalisers
face
the
exact
same
dilemma.
If
the
federal
government
is

feeling
liberal,
should
liberals
support
its
 imposed
liberalisations?
Or
should
liberals
favour

states’
rights,
even
when
states
are
inclined
against
liberalisation.
He
suggests
that
despite

much
arguing
in
the
US,
no
definite
answer
had
emerged,
and
it
didn’t
look
as
if
it
was
ever

going
 to.
 Which
 side
 of
 the
 argument
 you
 fall
 on
 probably
 depends
 on
 your
 view
 of

sovereignty
 and
 its
 importance
 at
 national
 level.
 Does
 national
 sovereignty
 matter
 more

than
 economic
 liberalisation?
 Dr
 Nigel
 Ashford
 of
 the
 Institute
 for
 Humane
 Studies
 firmly

believes
 that
 national
 sovereignty
 has
 been
 frequently
 used
 as
 a
 weapon
 to
 suppress
 free

markets.
Classical
liberals
should
prefer
a
free
market
European
Community
to
a
sovereign

socialist
government.
The
issue
is
not
one
of
defending
sovereignty
and,
if
it
is
presented
as

such,
 liberty
 will
 lose.
 The
 issue
 is
 whether
 we
 want
 a
 free
 or
 socialist
 Europe.
 When
 the

debate
is
expressed
in
those
terms,
liberty
shall
win.
Ashford
believes
that
liberalisation
via

the
Single
European
Market
can
be
successfully
enforced
by
a
federal
European
government

as
 long
 as
 it
 adopts
 the
 principle
 of
 ‘mutual
 recognition’,
 the
 principle
 which
 states
 that

goods
lawfully
produced
in
one
country
must
be
accepted
to
be
sold
in
any
other
EU
country

unless
 a
 specific
 exemption
 is
 obtained
 from
 the
 Commission.
 This
 principle
 promotes
 a

market‐led
 integration
 based
 on
 spontaneous
 order
 to
 replace
 bureaucratic,
 government‐
led
harmonisation.
It
should
also
create
competition
between
governmental
policies.
Those

countries
which
pursue
high
tax,
high
regulation,
anti‐market
policies
will
lose
out
to
low
tax,

low
 regulation
 and
 market
 friendly
 countries.
 The
 creation
 of
 the
 Single
 Market
 should

represent
 a
 major
 attack
 on
 “the
 discretionary
 powers
 of
 government
 and
 the
 monopoly

power
of
labour”.
It
is
because
socialists
have
realised
this
and
have
tried
to
counter‐attack

by
trying
to
capture
the
EU
for
their
own
purposes
(e.g.
trying
to
create
a
‘fortress
Europe’,
a

‘European
 Social
 Charter
 of
 Workers
 Rights’
 and
 harmonising
 VAT)
 that
 many
 free

marketeers
 have
 ended
 up
 in
 the
 position
 of
 defending
 national
 and
 parliamentary

sovereignty.
 This
 is
 an
 unnatural
 position
 for
 classical
 liberals
 to
 be
 in,
 when
 the
 EU
 is

supposed
to
promote
the
free
movement
of
goods,
services,
people
and
capital.



As
I
listen
to
these
arguments,
I
am
gradually
coming
to
a
view
of
my
own.
The
EU
should
be

there
 to
 provide
 a
 marketplace
 and
 set
 a
 framework
 of
 very
 basic
 rules
 and
 minimum

standards.
 I
 have
 no
 objection
 to
 a
 Services
 Directive
 which
 opens
 up
 markets
 in
 EU

Members
States
even
if
the
Directive
does
not
liberalise
as
many
sectors
as
I
would
like
to

see.
 Far
 better
 to
 under‐regulate
 for
 the
 Single
 Market
 than
 to
 impose
 an
 overbearing

directive
such
as
that
which
forces
a
nation
to
outlaw,
for
example,
its
system
of
weights
and

measurements
 against
 its
 will.
 I
 do
 prefer
 the
 democratic
 institutions
 of
 Westminster
 to

make
laws
for
the
British
people
than
those
of
the
European
Union.
But
I
also
have
to
see

politics
 in
 terms
 of
 what
 Rab
 Butler
 called
“the
 art
 of
 the
 possible”.
If
 it
 is
 only
 possible
 to

achieve
meaningful
deregulation
by
exercising
power
at
a
European
level,
I
am
prepared
to

use
 any
 power
 that
 I
 can
 exercise.
 Politicians
 have
 to
 do
 the
 best
 with
 the
 tools
 at
 their

disposal;
 and
 while
 there
 should
 be
 no
 letup
 in
 the
 Conservative
 campaign
 for
 European

institutional
 reform,
 I
 will
 be
 working
 within
 the
 institutions
 which
 exist
 to
 fight
 for
 a
 free

market,
liberal,
outward
looking
and
socially
tolerant
Europe.