In the European Community agreement on
common goals has frequently been reached only
after long-drawn-out negotiations and carefully
cobbled-together compromises. But the original
aim of the 1957 Treaty of Rome – that all obstacles
which impeded the free movement of goods,
capital and services, such as insurance and
banking, within the Community of 360 million
people should be lifted – had still not been entirely
met in the early 1990s. The Europe of the twelve
members of the Community was still fissured by
customs frontiers and blocked by mountains of
paper forms as well as hidden obstructions.
Nevertheless, the three major continental West
European nations – Germany, France and Italy –
backed the drive for closer union. Britain was
more reluctant to hand over control to the
Commission in Brussels, whose president from
1985 was the former French minister of finance,
Jacques Delors. Margaret Thatcher stood at the
forefront of those who believed that to elevate
the Commission as the ultimate source of power
would be profoundly undemocratic and that the
European Parliament was too weak to play the
role of existing national parliaments.
Which direction the European Community took
depended on the decisions reached by the heads of
government of its member states. It had always
been so and essentially it remained so in the early
1990s. This was not the intention of the founding
fathers, who wanted to move towards the closer
integration of Western Europe. They laid down
that, after an early stage during which unanimity
would be required in the Council of Ministers, the
‘qualified majority’ voting formula would come
into play. This meant that if France, Germany and
Italy were agreed, the other three original members
– Netherlands, Belgium and Luxembourg –
would be outvoted. Moreover, the three smaller
powers acting together would not achieve enough
votes to get a measure passed unless they could
gain the agreement of at least two of the other
three. In other words, neither Germany, France
nor Italy had enough voting power on its own to
veto a decision all the others were agreed upon. De
Gaulle scuppered any such notion of diminished
sovereignty in 1965: he boycotted the Community
for seven months and returned only when the socalled
Luxembourg Compromise was agreed on in
January 1966. This gave each member the right to
veto any decision affecting its vital national interests
– and the interpretation of ‘vital national
interests’ was left to the member state and could
include such matters as the price of barley.
The successive enlargements of the European
Community have altered the mechanics of ‘qualified
majority’ voting, but the national veto was
still in place in the early 1990s. The periodic
summit meetings of the heads of government –
accompanied, since 1974, by their foreign ministers
– were given the formal name of European
Council. They convene three times a year, and
their decisions set the guidelines. At the Council
of Ministers, more detailed agreements are
reached. The European Commission of civil servants
under the president and his ‘Cabinet’ of
sixteen nationally appointed commissioners also
has a powerful influence. It can initiate proposals
and then draw up amendments, but these require
the consent of the Council of Ministers who, in
turn, take their instructions from their national
governments. The European Parliament, directly
elected for the first time in 1979, has the power
to dismiss the Commission but not to appoint
one. Its day-to-day powers are limited; it is a consultative
rather than a legislative parliament.
There is also a court of justice.
The Single European Act of 1987 limited the
use of the national veto by requiring that qualified
majority voting should be substituted for unanimity
in a number of important areas concerned with
the creation of a common market. But the
national veto was still applicable in other areas.
A chronic Community problem centres around
the budget, which is contributed by member
nations. The main difficulty was the costly Common
Agricultural Policy (CAP), which absorbed
two-thirds of total expenditure; a temporary difficulty
was the implementation of a 1980 undertaking
to reduce Britain’s excessive net contribution,
which arose because with its small farming sector it
received relatively little in the form of CAP subsidies.
Since it was one of the poorer countries in the
EC, this was patently unfair. Margaret Thatcher
insisted in 1983 that the British government would
not sanction any increase in the Community’s
financial resources unless a long-term solution was
reached to replace the annual haggling.
In many ways Margaret Thatcher was out of
tune with the ‘continental’ style of the Community,
which Britain had entered too late. She
abhorred the Brussels bureaucracy and its pettifogging
regulations; she opposed the protectionist
stance that the EC adopted towards world trade;
above all she attacked the absurdities of the CAP
which, on the one hand, created huge and expensive
butter mountains and wine lakes to subsidise
the farmers out of taxation raised in member states,
and, on the other, increased EC food prices above
world prices generally. A free-trader by conviction,
what she did support was the removal of trade barriers
between member states. But she remained
profoundly suspicious of closer political union.
The European Community institutions are undemocratic,
and the one democratically elected
body, the European Parliament, lacks real power.
In any case, Thatcher was not ready to allow
European institutions to override the 700-year-old
Parliament at Westminster. She regarded democracy
and parliamentary institutions on the continent
as too recently established and not rooted in
tradition, as they were in Britain. What is more she
feared the overwhelming influence Germany
would be able to exert in a politically and economically
unified Community. All these views she
expressed with a passion and directness that made
her seem the outsider, even when others might
secretly agree with her.
Despite much acrimony and despite often giving
an impression of immobility the Community
tends to acquire sudden forward movement when
continuing crisis threatens its credibility. At the
Fontainbleau summit in June 1984, agreement on
the principal bones of contention was reached:
the British obtained the long-term settlement of
their budget contribution and the Community’s
resources were increased by undertakings to
raise the level of VAT. In a move that was to
prove of great significance in the 1990s, the
European Parliament in 1984 adopted a report
calling for a new treaty to create a European political
union.
Much wrangling in 1985 was settled in
December at the Luxembourg summit when it
was agreed in principle to adopt a Single European
Act. This comprised two separate parts, one establishing
a treaty for political cooperation, and the
other amending the Treaty of Rome to remove all
existing obstacles to a free internal market by the
end of 1992, thus making the original vision of a
common market a reality. Clearly the two parts,
‘politics’ and ‘trade’, could move forward at
entirely different speeds. It was a far cry from the
European union which a majority in the European
Parliament wanted – though, as we have seen, the
Act also provided for an extension of qualified
majority voting.
The dynamic but frequently tactless Jacques
Delors, Commission president, had little success
in persuading Margaret Thatcher to agree to an
increase in the powers of the Commission or to
support the closer political integration of the EC
members. For her part, Thatcher took the lead in
demanding reform of the CAP, though this made
slow progress. But in 1987 the Single European
Act was ratified by national governments and
finally adopted. The Community also accepted
compromises on the budget on the basis of proposals
put forward by Delors, which involved
gradual reductions in the proportion spent on
agriculture. Further cuts were in prospect if production
of specified agricultural produce exceeded
set ceilings.
As the decade drew to a close, the differences
between Britain and the rest of the Community
once more became accentuated. Britain favoured
the dismantling of barriers to trade and the creation
of a free market, but declined to join the
European Monetary System (EMS), which had
come into force in 1979, and therefore did not
participate in the Exchange Rate Mechanism
(ERM), which was designed to create currency
stability. In September 1988 Delors chaired a
committee of experts to discuss European monetary
union. The outcome became known as the
Delors Plan, which the Commission president
submitted to member heads of government in
June 1989. It envisaged the creation of monetary
union with a single currency. This was to be
achieved in three stages. All member states agreed
in June 1989 to participate in stage one, the
drafting of a treaty on monetary union. But
Britain refused to begin the second stage, which
– following signature of the treaty – would lay
down the conditions to be met by member states
that would make possible the attainment of stage
three: monetary union with a single currency in
use throughout the Community.
In opposing the moves towards monetary
union, Margaret Thatcher found herself increasingly
isolated not only in Europe but within
her own Cabinet. It was her chancellor of the
exchequer and her foreign secretary who insisted
at the Madrid summit in July 1989 that Britain
should formally accept the whole of the first stage
in principle. Margaret Thatcher continued to
oppose the goal of monetary union as it would
undermine national sovereignty, but in October
1990 she was reluctantly driven to agree to
Britain joining the system of fixed exchange rates
(the ERM). It transpired that John Major, then
chancellor of the exchequer, joined at too high
a mark exchange rate. As Mrs Thatcher’s adviser
Sir Alan Walters had warned, the resultant high
interest rates in Britain deepened the recession
and increased unemployment.
European political and economic union remained
a goal for the 1990s, though it seemed
hardly realisable with the members’ economies still
so widely divergent. This became painfully clear
when in September 1992 the Italian lira and the
British pound came to be regarded by the currency
exchanges as overvalued. Speculation against the
two currencies overwhelmed the defences mounted
within the ERM and both currencies had to
accept the market’s judgement and leave the ERM.
This meant that in effect they devalued against
the previously fixed rate. It was a healthy reminder
to politicians that in a free financial world their
powers are limited. Nor did the Community
nations manage to speak with a common voice on
all vital issues of foreign and internal affairs. The
realisation that such union might not be attainable
within the agreed timetable was resisted by the
political leaders who favoured it.
Seven smaller but nonetheless prosperous
Western European countries which had not joined
the European Community – Sweden, Norway,
Finland, Iceland, Austria, Switzerland and
Liechtenstein, members of the European Free
Trade Association (EFTA) – negotiated a treaty
with the Community in 1991 to create in 1993 an
enlarged European Economic Area of 380 million
people. In addition, Austria, Sweden, Norway and
Finland hoped to join the Community in January
1995. Switzerland too was expected to join those
in the antechamber until in a referendum in
December 1992 the populace decided by a narrow
majority not to join. Swiss neutrality had triumphed.
Negotiations were likely to be completed
before the mid-1990s, each country’s
special problems having been taken into account.
Sweden and Switzerland were reluctant to abandon
their traditional neutrality. Sweden, after
shedding its socialist policies and government in
1991, embarked on the formation of a market
economy to lift the country out of a deep recession.
Finland, also in recession in the early 1990s,
found itself freed from its dependence on the
Soviet Union, whose collapse also meant that it
lost its best trade partner. Austria in 1992 replaced
a president, Kurt Waldheim, who had become an
international embarrassment, and in the same year
its international reputation was greatly enhanced
by the generous way the small country opened its
doors to refugees from the former Yugoslavia. The
Community welcomed the possible accession of
the wealthier countries, which would help to provide
funds for the poorer Mediterranean members
and for Portugal.
Fundamental problems remained to be solved.
These included the reform of the Community
budget, and more particularly the need to curb
farm spending; the relationship to be developed
with the newly liberated nations of Eastern and
central Europe; and trade relations with the rest
of the world, especially the US, which demanded
a reduction of the Community’s protective barriers.
It held up the ‘Uruguay’ round of negotiations
to liberalise world trade through the
General Agreement on Tariffs and Trade begun
in 1986 and concluded in December 1993. The
main remaining obstacle was US congressional
approval before the agreement could come into
force in 1995. Agreement also had to be reached
on the respective roles of the Community institutions,
the relationship between the European
Parliament, the Commissioners and national governments.
There was a readiness among national
governments to relinquish sovereignty to a
limited degree.
It appeared that a high point of cooperation
had been reached when in December 1991 the
leaders of the Community as part of the Delors
Plan concluded a new treaty at Maastricht to
create an ‘ever closer union among the peoples of
Europe’. Britain led the opposition to the ideals
of a ‘federal Europe’ and a single common currency.
Britain also opted out of the ‘Social
Chapter’, which sought to provide minimum
conditions and standards in the workplace for
employees. French, Dutch and Belgian support
for Maastricht was based to a large extent on a
desire to ensure that the power of the recently
unified Germany should remain firmly anchored
in European institutions. This view had the
enthusiastic support of Germany’s Chancellor
Kohl. John Major agreed, albeit with important
reservations, because he wished to keep Britain’s
place of influence at the ‘heart of Europe’.
Within a few months it turned out that the
Community’s leaders were far ahead of their electorates
and had concluded a treaty difficult to ratify
and short of obvious popular appeal. The
threatened loss of national identity and objections
to giving Brussels more central control underlay
misgivings. Ratification was finally achieved in
November 1993, when the European Community
became the European Union. The margins for ratification
were slender in France and required two
referenda in Denmark. In Britain it caused a serious
rift in the Conservative Party. Britain opposed
moves to ‘closer union’, but had to give way when
in March 1994 the European Union offered to
admit Sweden, Norway, Austria and Finland while
restricting the rights of members to block decisions.
Sweden, Austria and Finland joined on 1
January 1995 after holding national referenda.
The Norwegian people rejected the advice of their
government and voted against joining the Union.
Three countries – Greece, Spain and Portugal
– were for many years barred from applying to join
the European Community, not principally on
account of the economic difficulties which their
membership would arouse but because of their
political systems. A fourth country, Turkey, an
‘associate’ since the 1960s, still awaited a
favourable verdict in the early 1990s. Greece’s
treaty of accession was concluded in 1979 and it
became a full member in 1981. It had only
recently returned to democracy after the collapse
of the military junta in 1974. Although democratic
government had a difficult passage after
1974, membership of the European Community
was a strong support.
The Greeks suffered more than any nation in the
post-war free world, the civil war from 1946 to
1949 causing widespread devastation. But that
conflict was followed by a period of conservative
parliamentary government under Field Marshal
Papagos and the most durable politician of postwar
Greece, Constantine Karamanlis. In 1963,
George Papandreou was able to form a liberal
reforming coalition until he was dismissed by
King Constantine after a dispute over who should
control the army. A group of extremist army officers
accused Papandreou’s Centre Union Party of
preparing the way for a communist takeover and
organised a coup in April 1967 ahead of the
planned general election. The dictatorial rule of
the Greek colonels from 1967 to 1974 was a disastrous
period for Greece. Abuses of human
rights, including torture, were rampant, and so
was corruption. The economy, which had been
doing well in the 1960s, deteriorated sharply. In
1974, beset by vociferous public demonstrations
and resistance following the fiasco of their Cyprus
policy and the shambles of army mobilisation, the
colonels’ junta collapsed.
Cyprus, after a long struggle, had been granted
independence in August 1960 and placed under
the guarantee of Greece, Turkey and Britain. But
the power-sharing constitution never worked
in the face of Turkish Cypriot and Greek Cypriot
animosities. Conflict on the island led to the
despatch of a United Nations peacekeeping force
in 1964, and Turkey and Greece themselves came
close to war. Ten years later, in July 1974, the
Greek colonels organised a coup and forced the
president of Cyprus, Archbishop Makarios, to flee,
preparatory to bringing Cyprus under Greek control;
the Turks reacted by invading and occupying
the northern portion of the island, defeating the
Greek Cypriots. An exchange of populations, with
200,000 Greek Cypriots leaving their homes in
the north, and Turkish Cypriots resettling there,
effectively partitioned Cyprus. All efforts to unite
the two halves and reach a workable compromise
between the two communities had failed by the
early 1990s, but the partition, with a UN force
patrolling the line between the two sides, had
ended the bloodshed.
The Cyprus dispute led to strained relations
between two NATO allies Turkey and Greece.
But Greece’s attachment to NATO after 1974
was ambivalent, partly because it was widely
believed in Greece that the US had supported the
hated colonels. US bases and the US naval presence
in Greece were consequently very unpopular,
both with the conservative governments
headed by Karamanlis, who had opposed the
colonels from exile in Paris, and with the liberal
centre governments of Andreas Papandreou (son
of George Papandreou) in the 1980s.
On his return from exile in 1974, Karamanlis,
with true statesmanship, guided Greece back to
democracy, only for Andreas Papandreou’s
Panhellenic Socialist Party to win the election in
1981, though his administration evinced little
socialism. Papandreou had gained a reputation
as an American-trained economist, but, as elsewhere
in the world, the shock of the oil-price rise
compounded Greece’s economic difficulties in
the mid-1980s. In opposition, Papandreou had
been stridently anti-Common Market and anti-
American; in government he acted with a greater
sense of responsibility. But by the end of the
1980s he and his ministers became implicated in
financial scandals; his electoral support nevertheless
remained solid. Greek politics were also
enlivened by his love affair with a former airline
stewardess thirty-five years his junior, photographed
with a telephoto lens bare-bosomed on
the beach. Papandreou was seriously ill with heart
trouble at the same time. He subsequently
divorced his wife, married his mistress and was
narrowly defeated in the general election of 1989.
No party emerged as outright winner, and coalition
governments were succeeded in 1990 by a
conservative administration with a tiny majority
led by Prime Minister Konstantinos Mitsotakis.
Reforms strengthened the economy after years of
socialist profligacy but also caused hardship. The
elections in October 1993 returned Papandreou
to power. The Cyprus question continued to
disrupt its relations with Turkey. But as a member
of the Community it had received aid and gained
substantial advantages.
On Papandreou’s death in 1996, Costas
Simitis, a younger founder of the socialist Pasok
Party became prime minister and took the party
into the elections of that year. The country had
become increasingly polarised with the revival of
the conservative New Democracy Party but Pasok
won a working majority of seats – 158 against
New Democracy’s 125. Greek politics, still linked
to the dynasties of a few families, however, came
to be dominated less by ideology and more by the
requirements of its membership of the European
Union. By taking Greece into the Monetary
Union, Greece had been forced to adopt prudent
budget policies. Austerity measures inevitably
proved unpopular. Simitis steered the politics of
his party to the centre, reforms to modernise and
make the economy more competitive were pragmatic
rather than ‘socialist’. He stated a modest
aim of cutting unemployment down to 7.3 per
cent. Unemployment at over 9 per cent remained
the blackspot. But with the help of European
Union funds, fiscal discipline and liberalisation,
Greece’s economic growth rate became one of
the best in Europe between 3 per cent and 4 per
cent annually from 1997 to 2003 while the high
inflation rate fell from 16 per cent to under 7 per
cent. With the stabilisation of the Balkans after
the Yugoslav wars, Greece, the most advanced
economy in the region, will benefit further. A new
feature in Greece has been large-scale immigration
from its neighbours, happy to do more
medical work and proving a benefit to the
economy and less of an issue of public disquiet
than might have been supposed. Simitis abandoned
Papandreou’s populist, nationalist anti-
American tone; the policy toward Turkey is more
pacific with Simitis and George Papandreou, the
highly regarded foreign minister supporting the
principle of Turkey’s admission to the European
Union. Greece was governed for nineteen out of
the last twenty-two years by Pasok and partners
on the left. It required a small shift of voters discontented
by austerity and high unemployment
to bring New Democracy back into power in
2004 as the eyes of the world were on Greece
hosting the Olympic Games. In March 2004 the
centre-right New Democracy party broke Pasok’s
hold on power, won the elections and Costas
Karamanlis became prime minister.
Spain joined the Community in 1986, a move
made possible by an astonishing decade of
change. In November 1975, the old dictator
Franco had finally died, wired up to many
machines in a vain attempt to prolong his life by
a few days. He had given Spain stability and,
shrewdly, had not thrown in his lot with his fascist
helper Mussolini or with Hitler during the
Second World War. It was to his credit too that
he had not marched into Gibraltar during
Britain’s great crisis in 1940. That Spanish volunteers
had fought on the Russian front with
Hitler was not held against him in the 1950s. He
survived the early years of international ostracism
and, with the onset of the Cold War, he began
to be rehabilitated by the US in 1950. Three
years later in September 1953 the US gave aid in
return for three bases and a mutual defence pact;
international forgiveness was extended when
Spain in December 1955 became a full member
of the United Nations. (Spain was not admitted
into NATO until 1982.)
Franco’s Spain remained a repressive regime in
the 1950s, but during the 1960s reforms were
gradually introduced, military courts were abolished
and workers were granted a carefully limited
right to strike. Constitutional changes effected in
1966 provided for the election of a minority of
members of parliament, though political parties
were banned. Franco enjoyed widespread popular
support and was seen as standing above the
Falange, the Church and the army, which were
locked in bitter conflict. The most serious threat
to his rule came from ETA, the independence
movement of Basque nationalism. As his successor,
Franco had groomed Prince Juan Carlos,
grandson of Alfonso XIII; Franco judged that a
return to a ruling monarch would be the best
guarantee for preserving conservative peace in
Spain. Juan Carlos gave no sign during Franco’s
lifetime of the liberal and democratic role he
would crucially play after the caudillo’s death.
During the three decades since the Second
World War, Spain had begun to modernise both
its agriculture and its industry. The progress made
since the 1960s had been considerable, aided by
the West European discovery of Spain as a holiday
playground. But democratic advance was by
no means assured in 1975. King Juan Carlos
appointed a moderate socialist, Adolfo Suárez, as
prime minister. Suárez restored parliamentary
democracy and permitted all parties, including the
communists, to compete in the general election of
1977. King Juan Carlos gave his firm backing to
democracy, and neither he nor the people would
tolerate an army coup, such as was attempted in
1981. A further coup was threatened ahead of the
general election in 1982, which the Socialist Party
won, Felipe González becoming prime minister.
González’s biggest success was the signature in
June 1985 of the treaty of accession to the
European Economic Community, which Spain
joined in January 1986. The second half of the
1980s was a period of sustained economic growth,
as González followed orthodox economic policies
– to the chagrin of his more socialist followers. In
1989 he won the general election for a third time
by a narrow margin. The economy has continued
to grow. One black spot in Spain’s astonishing
progress was the continuation into the 1990s of
sporadic terrorist attacks by the Basque extremists.
But Spain was not alone in the Community in this
respect. In the early 1990s it shared the problems
of recession with the other members of the
Community, including high unemployment, and
González’s popularity fell.
‘No gain without pain’ can be applied with a
vengeance to Spain, whose government, like
Italy’s, was determined to be accepted into the
Monetary Union. Bringing the public sector
deficit down to 3 per cent required under the
Maastricht Treaty led to high unemployment at
well over 20 per cent which could not be lowered
by more spending. With the defeat of González
and the Socialist Party in the general election of
March 1996 a new chapter opened in Spain’s
politics. José Maria Aznar led the Conservative
People’s Party and formed a minority government.
By granting greater autonomy to the seventeen
regions he gained the support of the more
moderate Basque National Party and the mainstream
Catalan Nationalist Party. He set out to
improve the economy, to tackle the deep-seated
economic and regional problems – endemic corruption
and favouritism to special-interest groups.
Aznar was a former tax inspector, a small neat
figure, lacking the glamour of González. His first
term in office was extraordinarily successful in
changing Spain’s sluggish progress, privatising
state industries, reducing unemployment from
close to one in five to a still high one in seven,
reforming labour laws and ensuring that prudent
balance of state expenditures and income met the
limits set by a member of the Monetary Union in
1999. Spain took advantage of benign world economic
conditions to achieve a high growth rate
and shook off completely the shadow of the
repressive Franco dictatorship. With Catalonia
and its vibrant city of Barcelona a workable
accommodation was reached. In the Basque
region while the Basque regional government of
moderates did not seek independence, the terrorist
ETA did not abandon bombings. Tensions
remained high. In foreign relations Aznar
defended national interests in the European
Union protecting the regional aid Spain enjoyed.
Despite long negotiations no settlement was
reached on the future of Gibraltar, whose population
would have no truck with any kind of joint
sovereignty deal. Along with the rest of continental
Europe, the Spanish people were opposed
to war with Iraq in 2003, but Aznar ignored
public feeling and was notable as the only
Western European leader to stand firmly backing
Blair and Bush. Aznar can look back on a successful
tenure of government even though unemployment
still remained too high and regional
problems unresolved. Aznar was expected to win
the elections of March 2004 before handing over
to his successor. The Madrid train bombings on
11 March killing 191 people and injuring more
than 1,000 changed all that. Aznar was too quick
to try and lay the blame on ETA. The Socialists
(PSOE) won and José Luis Rodriguez Zapatero
became prime minister. He reversed Aznar’s Iraq
policy and brought Spain’s troops home. Socially
more liberal, for example recognising gay marriage,
less tolerant of the privileges of the Church,
he is not a radical who will rock the economic
boat which has given Spain sound growth (3.2
per cent annually) and halved unemployment to
a still high 11 per cent. He has also realigned
Spain more closely again with France and
Germany in the European Union. Spain in the
new millennium is a vibrant free democracy
attracting to its sunshine coasts millions of
tourists and much investment. The Franco years
are slipping into history.
Portugal joined the European Community at the
same time as Spain. But its transition to democracy
was far more traumatic. Antonio Salazar was
Europe’s most enduring dictator, ruling from
1932 to 1968, when a stroke incapacitated him
and the right-wing regime of Marcello Caetano
took control for six years. As dictators go, he was
relatively mild, imprisoning rather than executing
his opponents, and during the Second World War
he had actively assisted the Allied cause. After
1945, therefore, he remained in relatively good
standing, even though he had a secret police and a
card-index system concerning his opponents which
was borrowed from the Gestapo. In 1970 Salazar
died. The revolution that broke out in April 1974
was not democratic in intent but was organised
by army officers disillusioned with the wars in
Portugal’s African colonies of Mozambique and
Angola. It took a curious turn when radical army
groups entered an alliance with the communists.
A general election was held in April 1975 and the
Socialist Party gained most support; the communists
lost out. Mario Soares became prime minister
until his replacement in 1979 by a centre–right
coalition. By then, democratic parliamentary rule
was firmly established – despite their great poverty,
the Portuguese people had not turned to the communists.
After the election of 1983, Soares again
headed a government coalition of Socialists and
the centre, which successfully implemented economic
reforms, making state enterprises more
efficient and encouraging the private sector; of traditional
socialism there was little.
From having no elections, Portugal now had
too many. Party manoeuvres led to the fall of
Soares in 1985 and another general election. In
the following year, the country’s kaleidoscopic
politics required the election of a new president
and, after more party manoeuvrings, the office
was won by Soares, who thereupon resigned from
the leadership of the Socialist Party. The government
of Portugal after 1985 rested on the support
of the Social Democratic Party which, once it had
gained an overall majority in the election of 1987,
set itself the task of reversing socialist state control
of industry. Prime Minister Cavaço Silva ‘cohabited’
amicably with the Socialist President Soares,
who was re-elected with an overwhelming majority
in January 1991. The following October
Cavaço Silva’s Social Democratic Party scored a
second electoral victory with an impressive overall
majority endorsing ‘cohabitation’.
During the 1980s Portugal made considerable
economic progress, as governments turned from
socialism to a market-oriented economy. All pretence
that Portugal was in a ‘transition to socialism’
and was committed to becoming ‘classless’
was dropped from the new constitution of 1989.
Its gross national product per head of $2,020 in
1978 had tripled by the early 1990s. Since the
mid-1980s Portugal had achieved a remarkable
degree of political stability and economic progress,
and was an enthusiastic member of the European
Community. Portugal suffered along with other
members of the EU from sluggish growth in its
closing years of the 1990s, inflation increased well
beyond the Monetary Union’s target and corruption
scandals weakened Silva’s position. Intended
reforms of the over-large, protected and padded
administration remained to be undertaken.
After a decade in power the electorate was
looking for a change. Silva’s centre-right Social
Democratic Party was convincingly defeated in
1995 by the Socialist Party and Antonio Guterres
gained the premiership. His first four years in
office saw his popularity rise. Portugal was benefiting
from good economic growth and low
unemployment. Membership of the European
Union was proving of great benefit. In 1999,
despite fears that Portugal would not be able to
meet the conditions of the common currency,
Guterres was able to take Portugal in. This
marked the height of his popularity and in the
elections of 1999 the Socialist Party increased its
majority. In March 2002, elections held prematurely,
gave the Social Democratic Party a narrow
victory and to the leader of the opposition, José
Manuel Durâo Barroso, as prime minister, now
fell the difficult legacy of reform, until 2004 when
he was chosen to succeed Romano Prodi as president
of the European Commission.
Turkey applied for full membership of the Community
in 1987. Two years later, the Community
replied that it was deferring consideration of
further applications until after 1993, though it
offered the sop that Turkey was eligible. Greece, as
a member of the Community, remained deeply
suspicious of Turkey, though their relations
improved after a low point in 1987. Nevertheless,
the Cyprus question continued to stand in the way
of a normal cordial relationship. Turkey’s humanrights
record was also suspect and its economy
tended to fluctuate wildly between growth and
stagnation. The Kurds represent a serious minority
problem and the Asia Minor region of the country
is not only poverty-stricken but practically under
military rule. The economy, too, is backward.
Kemal Ataturk had set up State Economic Enterprises
in the 1920s and 1930s to modernise
Turkish industry, but by the early 1990s they had
become outdated and unproductive. With its
rapidly increasing population of 57 million in
1990, Turkey’s gross national product per head,
estimated at $1,870, was that of a Third World
country, far less than Greece’s and even that of
Portugal, the poorest country in the Community.
Nor was parliamentary democracy absolutely
secure. The army was faithful to the Ataturk tradition
and kept a watchful eye on the civilian politicians,
periodically making itself responsible for
holding the country together.
In May 1960 the army seized power and the
former prime minister Adnan Menderes was executed
a year later. When a resumption of civilian
politics in the 1960s and 1970s was again accompanied
by growing disorder and economic
hardship, another army takeover followed in
September 1980. In November 1983 there was
then a return to semi-civilian parliamentary government,
accompanied by much political repression
of liberals and socialists; martial law remained
in force under the conservative prime minister
Turgut Özal. He instituted some vigorous economic
reforms and privatisations, and gradually
returned Turkey to a more normal political state,
but the parties contesting for power remained
unstable.
Özal sought to lessen tension with Turkey’s
neighbours, especially Greece. His main aim was
to gain full membership of the European Community,
to continue the military and economic
aid that the US had steadily sent to a valuable ally
during the Cold War. Turkey was also an important
player in the Middle East. In November
1989, Özal enhanced his stature by becoming
president, but the economy rapidly deteriorated
again. Turks fled from Bulgaria in 1989. In April
1993 Özal died. The biggest internal problem
that faced his successors was the armed struggle
of revolutionary Kurds.
The elections of 1995 and 1999 did not cure
the roundabout of ineffectual coalition governments
of old-guard politicians. The most notable
event of 1999 was the capture of Abdullah
Ocalan, leader of the guerrilla Kurdistan Workers
Party (PKK) which had waged a ruthless struggle
for independence resulting in at least 30,000
deaths. His fight was nourished by the suppression
of Kurdish rights to their own language and
education and the brutality of the army. The
human-rights abuses inflicted on even the moderate
12 million Kurds remained one of the bars
to Turkey’s wish to join the European Union.
The generals in the National Security Council
guard the secular state and have required politicians
to follow their guidance. Democratic development
is opposed by a coalition of interests –
army, police, security services and bureaucracy
blocking reform. The economy suffered from
high unemployment and the precipitous loss of
the value of the currency with inflation annually
of over 50 per cent. Corruption and mismanagement
were endemic. But Turkey has been a
staunch NATO ally in the Cold War and after and
was assisted with loans from the US. Relations
with Greece remained tense, the Turkish occupation
of northern Cyprus since 1974, a major
obstacle. Turkey’s 67 million people seemed to
be caught in a political and social pattern resisting
fundamental change. The door of the
European Union remained frustratingly closed.
Would progress at home continue to be stymied?
In Turkey there was suddenly fresh hope of
human-rights reforms during the early years of the
new millennium. The elections held in November
2002 resulted in a political earthquake. The old
parties and their leaders did not gain enough votes
to hold a single seat in the parliament. The voters
had turned to a new party founded in 1997, the
conservative Justice and Development Party, ak
for short meaning white or clean, which gained a
large overall majority and so could govern without
having to rely on coalition partners. It was led by
Recep Tayyip Erdogan, a former mayor of
Istanbul. He had earned the suspicion of the generals
for his earlier Islamist Party association.
Imprisoned for four months on a pretext, he was
at first barred from politics and the premiership, so
his nominee for the first few weeks held the post
for him. Erdogan promised reform and to follow
a pro-Western secular policy that would make it
possible for Turkey to join the European Union.
Early on, reforms were passed by parliament, the
Kurds were granted rights to language and education,
there had already been increasing economic
investment in Asia Minor to win over Kurdish
moderates, and the generals in 2003 promised to
respect the wishes of the Turkish electorate. The
dire state of the economy was the most serious
problem facing Erdogan’s administration in 2003.
The situation was not helped when, despite
Erdogan’s urgings, parliament narrowly refused to
grant a right of passage to US troops wanting to
open a northern front in the Iraq war; the US
retaliated by withholding loans. After the war,
relations mended and an IMF loan linked to a
reform programme came to the rescue. The failure
of the long-drawn-out UN-sponsored mediation
efforts in the spring of 2003 to reunite Cyprus was
disappointing. The generals remained opposed.
Forty thousand Turkish troops are on the island,
but even on the divided island the situation eased
when the ‘green line’ was opened in April 2003 by
Rauf Denktasch the Turkish Cypriot leader permitting
Greek Cypriots to visit their former
homes. Greek Cyprus joined the European Union
in May 2004; the island remained divided; the
Turkish Cypriots’ northern population were left
outside although they had voted for the union
plan. With the new government in Ankara relations
with Greece improved, but Cyprus remained
an obstacle. Unless the Turks recognise Cyprus,
the Greek-Cyprus government threatened to
block accession talks. Erdogan’s reforms and
promises of further reforms took Turkey one step
nearer in 2004 to join the European Union when
agreement was reached to open accession negotiations.
There was still a long way to go. It will take
at least ten years before Turkey will be judged to
have been able to meet all the political, economic
and human-rights criteria and much can happen
in that time. Some members, especially France,
harboured strong misgivings over admitting
another poor nation of over 70 million mainly
Muslim people and extending the EU’s frontiers
into the volatile Middle East. But neglecting
Turkey’s claims would undermine its reforms.
The Democratic German Republic, of course, was
barred from the European Community, but West
Germany was allowed to extend trading benefits
to it. With the death of the DDR and its incorporation
into a united Germany in 1990, the territory
became a part of the EC without, of course,
adding to the number of members.
One of the major achievements of the European
Community was the strengthening of democracy
in the poorer nations of the West – Spain, Portugal
and Greece. Membership of the club is open only
to countries that respect civil rights and abjure
totalitarian forms of government. Once brought
in, no country has suffered a relapse, and such an
eventuality is difficult to imagine. Thus, not only
has the European Community become an association
promising greater prosperity to the poorer
West European nations, but it is also a powerful
bastion of freedom in the world.
The habit of close cooperation and negotiated
settlement of differences has become the norm of
national relations within the Community. With
the removal of trade barriers, 1 January 1993
marked the beginning of a new phase of increasingly
close Community cooperation in the sphere
of trade to the benefit of the 340 million people
whose countries are its members.
France and Germany, leading an inner group,
were urging closer cooperation to be spearheaded
by supplementing the Common Market with a
common currency. The Delors Plan of how to
achieve a monetary union, endorsed by the leaders
of the Community in 1989, gestated for a decade
before becoming a reality on 1 January 1999. The
barriers set up to prevent any member that did not
meet certain criteria from being eligible to join
were an essential aspect. Of especial importance
was the Stability and Growth Pact (1997) which
threatened penalties if any member exceeded a
deficit limit of 3 per cent on its annual budget.
The Germans especially did not want to exchange
their stable mark for a euro that could be devalued
by the reckless state expenditure of one country.
A European Central Bank has administered and
decides on the interest rate common to all its
members. With the turbulence of the world economy
and the slow growth rates it did not look as
if the necessary convergence would be achieved to
allow monetary union to go ahead on time. Was
the hurdle set too high? It was typical of the history
of the European Community which, since
1992, had become the European Union, that difficult
goals were achieved often as time threatened
to run out. On 1 January 1999 the Monetary
Union became a reality. Greece was not considered
to have met the criteria; Britain, Denmark
and Sweden decided not to join; the other eleven
members, Austria, Belgium, France, Finland,
Germany, Ireland, Italy, Luxembourg, the
Netherlands, Portugal and Spain became the
founding members; and in 2000 Greece was
admitted. The early years in the new century
revealed difficulties. The same interest rate proved
too high for some and too low for others. The
euro lost value on the international exchange, but
the devaluation was beneficial at a time of sluggish
economic growth. The Stability and Growth Pact
insisted on by the Germans proved a handicap in
managing economies in difficult periods and is too
crude in its operation. Consequently, observance
of it has been fudged especially by the two largest
economies of Germany and France who breached
the 3 per cent budget deficit. But judged overall,
the euro has been a success, binding the European
Union more closely together though Britain,
Sweden and Denmark in 2004 still remained outside
the Monetary Union.
The second most important development in the
later 1990s and the early twenty-first century has
been the enlargement, to expand the European
Union by admitting in May 2004 ten new members:
Poland, Czech Republic, Slovakia, Hungary,
Slovenia, Malta, Cyprus, Estonia, Lithuania and
Latvia. The negotiations have been long and
tough. The new members will not secure equal
benefits of membership before 2006. In particular,
they will receive only a quarter of the farm subsidies
paid to the older fifteen. Their markets after
transitional agreements run out will be thrown
open to competition which will benefit the more
efficient and bankrupt the less competitive.
Farmers are most likely to suffer. In the long term,
however, to be an integral part of the European
Union is likely to prove as beneficial as it did for
the once less developed members, Spain, Portugal
and Ireland. Bulgaria and Romania are not in the
party but have crossed the first threshold and
Turkey, the biggest problem, is knocking on the
portals.
Ever closer union has proved a difficult path to
pursue. The institutions of the European Union
are still developing. The Commission in Brussels
has come under particular criticism for its ineffectual
control of funds handed out to member
states. Fraud was endemic and annually criticised
by the auditors. A crisis point was reached in 1999
when the European Parliament flexed its muscles
and the whole Commission resigned. Promises of
effective reform under its new president Romano
Prodi still remain to be fulfilled in 2004. Another
problem is to achieve more democratic control
over decision-making.
The European Parliament has gained more
influence under the treaties of Amsterdam (1997)
and Nice (2000), but this clashes with the determination
of the leaders of the member states to
retain ultimate control of crucial decisions in the
Council of Ministers.
World History
