Shallow self-interest shapes the EU rule of law showdown

It is tempting to see the stand-off over the EU’s €1tn-plus budget and €750bn pandemic recovery plan as a deep crisis dividing Europe: between east and west, old and new members, conservatives and liberals, national sovereignty and federalism. It is tempting, but wrong — and worse than wrong, it is harmful.

Hungary and Poland are vetoing the next budget and recovery fund in protest at a new rule that ties EU funding to rule of law safeguards over how money is used. They decry the mechanism — though they agreed to rule of law “conditionality” in July — as an underhanded ideological attack by western liberals on their socially conservative and anti-immigration values.

But this is not an east-west schism. Among the countries that joined the EU from 2004 onwards, Hungary and Poland are far from alone in having Trumpian politicians or corruption problems. Yet only they have vetoed the budget. Nor is it a civilisational crusade against the rest of Europe. The Polish and Hungarian governments’ stance offends a majority of their own citizens. Moreover, it is tightly linked to the narrow interests of the ruling parties and their politicians.

Poland’s budget veto has become a weapon in a power struggle between Prime Minister Mateusz Morawiecki and the justice minister Zbigniew Ziobro for influence in the coalition controlled by the country’s de facto leader, Jaroslaw Kaczynski. In Hungary, EU-funded contracts have enriched Prime Minister Viktor Orban’s family and close associates. Potentially, they could be blocked under the new mechanism if found in breach of the rule of law.

The lashing out from Budapest and Warsaw should be seen for what it is: the ructions of dysfunctional political systems reduced to serving as megaphones for the personal demons and obsessions of two overpowerful individuals.

It is a dysfunction the leaders do not even bother to hide. Last Wednesday Mr Kaczynski railed in parliament that the opposition “have blood on their hands” and exchanged calls of “you’ll be locked up”. Mr Orban redeployed his anti-Semitic conspiracy theory that the EU is running the errands of George Soros — Mr Orban’s erstwhile benefactor — to “operationalise” the “blackmailing” of Hungary into accepting high levels of immigration. These are not the words of leaders protesting in good faith.

We should not downplay the gravity of their obstructionism, which ultimately flows from attempts to capture the state. But it suits Messrs Orban and Kaczynski at home and abroad to dress this up as a defence of sovereignty, Christianity and their nations’ identity. It is vital for everybody else to call out what a self-interested fight it really is. Elevating it to a civilisational conflict over European values gives autocracy a grandeur it craves but does not deserve. It wrongly increases the allure of compromise and risks unnerving those who defend impartial and transparent institutions in Europe.

They should hold their nerve. For there is no good endgame Budapest and Warsaw can extract from this stand-off unless it is given to them. Seeing them for what they are exposes that they are also weaker than they seem.

The rule of law mechanism does not need unanimity. It will become law unless the rest of the EU gives in to the Orban-Kaczynski hold-up. They can block the new budget as long as they like, but some money will continue to flow in limited monthly rollovers of the old budget — subject to the new rule of law conditions they so oppose.

As for the recovery fund, the EU should pursue liberal MEP Guy Verhofstadt’s proposal to set it up for the other 25 countries under “enhanced co-operation”. This permits the use of EU structures for projects only some members want to take part in. It would even make the recovery fund’s borrowing somewhat more creditworthy, because Hungary and Poland, if included in the fund, would be large net beneficiaries.

Some recall former UK prime minister David Cameron’s veto of an EU fiscal treaty in December 2011, when other leaders went ahead without him. Since that road led to Brexit, so this argument goes, beware of doing the same with Hungary and Poland.

The analogy is false. The British veto reflected real problems of national interest related to a big financial centre’s non-membership of the eurozone, tensions even the most EU-sympathetic of UK policymakers acknowledge. In time the EU accommodated these legitimate interests. The Hungarian-Polish veto reflects no national interests or political projects, only personal ones. Yet both depend more on Europe economically.

The right lesson for the EU to learn from the UK’s history with Europe is an older one: keep calm and carry on.

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