Address by Minister Donohoe to the IIEADFAT - 31/10/13
Text of the address delivered by Minister Donohoe at the Institute for International and European Affairs, Dublin, entitled 'Reflections on the Horizon Ahead'
‘Reflections on the Horizon Ahead’
Few speeches to the Irish Institute for International and European Affairs have begun with the extraordinary story of the pop single 'Gangnam Style' and the South Korean music star, Psy.
This is where I am beginning to demonstrate, by way of story:
First - the economic and social environment within which Ireland exists;
Second - my views on the guiding principles of Irish policy towards the EU;
Third - how both have determined my priorities as Minister for European Affairs.
I intend to conclude with some comments on current EU affairs and Irish policy priorities.
The Story of Psy
Prior to July 2012, Psy was well known within South Korea but was not an international pop figure like Lady Gaga or Madonna. He did not feature on the playlists and dance floors of Ireland or Europe.
All of this changed with the launch of his sixth album,'Psy 6, Part 1'.
Within one year of the release of this album, and its single, 'Gangnam Style', Psy had transformed from a domestic figure of some fame to a global star.
The Secretary General of United Nations, Ban-Ki Moon, met with him to discuss how his music, "could be a force for improved global cooperation".
Psy received an audience with the Dalai Lama and was praised by President Obama.
His dance routines were imitated by hundreds of millions of people, all over the world.
How did this happen? How did he move from local to global fame?
Through YouTube and the social media revolution.
The video for ‘Gangnam Style’ has now been viewed 1,773 billion times on YouTube, becoming the first video to exceed the billion hit mark.
Let those figures sink in, one thousand, seven hundred and seventy three million views. With most of this achieved within one year.
This story demonstrates the amazing power of the communications' revolution. Deep and profound interconnection is now such a daily part of our existence that we take extraordinary feats of communication for granted.
Interconnection. Integration. Interdependence. Of the deepest kind.
These concepts are essential if we are to understand modern economies. Whether they be national, European or global.
Demonstrations of this point abound throughout the economic crisis:
Of how a bubble in lending to American low-incomes families triggered a crisis that impacted families everywhere.
Of how the Greek financial crisis carried not only harsh consequences for Greek citizens, but had a massively significant impact beyond its borders.
Cause and effect do not recognise national boundaries.
Globalisation: Benefits and Difficulties
This phenomenon is summed up under the phrase 'globalisation' - a technical phrase that belies a profound transformation - from local and isolated, to the integration of local and national cultures, economies and societies into a globalised whole.
So what has all of this meant?
Let me pick examples of the benefits and difficulties of this transformation:
Since 1950, global exports have grown at a rate of 6% - an extraordinary rate of increase.
The United Nations calculates that since 1980, average incomes per head have increased by 70%. Within Europe, across the same period, per-head incomes have surged by 49%.
And the difficulties:
Widespread absolute poverty, particularly for children. The World Bank has recently estimated that 400 million children live in extreme poverty.
The development of financial instruments whose complexity and difficulty to regulate nearly wrecked the real economy.
Globalisation is the defining political, economic and social characteristic of our era. It uniquely offers the opportunity for countries to prosper:
By allowing access to wider markets. By allowing national citizens to understand and learn from other cultures and proudly share in a world where physical distance is made irrelevant by the power of digital communication.
I do not believe that globalisation is something done to us, inflicted on societies by an all powerful 'other'. It is a direct consequence of our human desire to communicate, to share and to exchange.
And as I believe these are traits that form an essential part of our national identity it is an environment within which Ireland can and does do well in. Our size, our location and our history has endowed us with an appreciation of how large forces can help us surf towards better prospects or can capsize our efforts to protect and develop our State.
But the other 'side of the coin' - the risks of financial deregulation, the threat of alienation, the damage to our environment, the possibility of the erosion of national traits are real, significant and present.
The State vs Globalisation
I therefore believe that the defining challenge that any State faces is how we respond to the transformative effect of globalisation. This is the policy stream from which many of our political challenges flow.
I can see this very clearly in my engagements since becoming a Minister. While still early in my tenure, I have now attended two General Affairs Councils, one Eurogroup meeting, one Ecofin Council, one Informal meeting of Ministers for European Affairs; I have addressed the Northern Ireland Assembly Committee for the Office of the First Minister and Deputy First Minister as well as addressing the British Irish Parliamentary Assembly on the EU.
I also attended the European Council with the Taoiseach and participated in many bilateral meetings with Ministers from other Member States. All in all, between August and Christmas I will have performed twenty engagements with European Institutions or in Member States.
And I can tell you, all the key policy discussions emanate from the same source: from efforts to positively mediate the consequences of globalisation.
This can be seen in discussions surrounding Banking Union, as a response to global capital flows and of the regulation of banks rooted in the global economy.
It is also evident in discussions in relation to protecting the environment, where the most effective responses are shared across national boundaries.
Our New National Question
How we respond to the challenge of globalisation is our new National Question. At different times in our history this Question has meant different things to our people.
At one point it was about independence, at a different point about the location of our borders and our relationship with Northern Ireland. At each stage this Question was nearly exclusively physical.
We now face a National Question of a very different kind - of how a small island off the coast of Europe can prosper within, and respond to, a globalised world?
This is well expressed by Dani Rodrik, a Harvard-based economist, who describes the, 'political trilemma' - whereby countries cannot simultaneously achieve democracy, participate in economic globalisation and pursue national self determination. At best, he believes, they can achieve two of these three priorities.
Paradoxes of Sovereignty
So, all of this poses an essential challenge to sovereignty. Philip Stephens of the Financial Times summed up this challenge, when in an address to this Institute earlier this year, he observed that, "sovereignty is increasingly prized but even as it is prized this sovereignty is increasingly ineffective".
Ireland has responded to this paradox strategically by embracing membership of the European Union. Three core insights have motivated this choice:
First, shared sovereignty should be strengthened sovereignty. To state it differently, there are some issues which are beyond the grasp of any State, small or big, to deal with effectively on its own. The better States work together, the stronger their response to global challenges and opportunities.
Second, this leads directly to our second principle. That the Institutions of the European Union offer the best way for this shared response to be developed. This is through the Community Method.
It offers a guarantee of fairness by ensuring that the vital national interest of each country is recognised, while enabling strong collaboration between each Member State.
And this leads directly to the final principle, that a European framework is the best platform for the advancement of the Irish national interest. This framework does not subsume or replace a national interest - rather it offers a vehicle within which it can be expressed.
To summarise, in the space between nominal sovereignty and effective sovereignty resides our membership of the European Union. And this is an active space - where Ireland collectively makes decisions on issues that impact on us and the people of Europe.
Different Kinds of Unions
Amidst this talk of sovereignties, methods and frameworks let us not lose sight of the key point. Simply:
That we're more effective together. And the 'we' here refers to the countries of Europe. On our own we're less effective in responding to the things our people care about.
So when we talk of banking unions, fiscal unions, transfer unions and political unions let us first remember the essential union on which all these other unions rest. A union of values and a continent that recognises the value of union.
Providing a Framework
This thread, the link between sharing sovereignty, to the Community Method, to advancing national interests inside the framework of the Union has under-pinned the policy of our State towards the EU.
So, after framing what I believe to be the decisive challenge that our State continually faces, I now want to link this clearly to my own priorities as a Minister and make some comments on our current situation.
After the Taoiseach appointed me, I determined four priority themes for my term in office: Engaging with Europe, Accountable Europe, an Open Europe and Effective in Europe.
I will address each in turn:
Engaging with Europe
An evident but, none the less vital, place to start. It is my commitment to maintain a high level of engagement with our friends in the EU, and we have 27 of them, following our successful Presidency of the Council of Ministers.
As I mentioned earlier, between the end of August and Christmas I will have completed twenty visits to Member States, Ministerial or European Council meetings and European Institutions. Many of these engagements have included meetings with local media, officials and business communities, including our Diaspora, to reinforce the message that Ireland is regaining its strength and will emerge, as the first, from bailout in December.
Included within these engagement priorities is the European Parliament. The Lisbon Treaty, as you all know, developed the powers of the Parliament through increased co-decision making.
This was very evident throughout our Presidency; co-chairing 374 triologue meetings alone in just six months.
The partnership with the Parliament led to important decisions on Banking Union, the Multi-annual Financial Framework and the finalisation of major policy programmes such as CAP and Horizon 2020.
This brings me to the concept of 'an accountable Europe', which refers to engagement between the Oireachtas and Europe. Prior to my appointment as Minister, I spent six years as a member of the Joint Committee on European Affairs. As a Senator I chaired the Oireachtas Sub-Committee on Ireland's Future in Europe. I have form in this area!
It is important to acknowledge the progress that has been made. This Government has ensured that relevant policy committees are charged with engaging in their relevant area of European policy and debate.
This is a substantial change and a welcome development from asking the previous Joint Oireachtas Committee on European Scrutiny to review everything from eel fishing to financial regulation. Similarly, the pre and post European Council debates with the Taoiseach, Tanaiste and I, and the annual Europe Week in the Oireachtas are good reforms.
That said, we must do more. I am therefore working with my Department to put in place a review of all or our practises. I will write to each Oireachtas Committee requesting their input into this process. Based on this, I intend to suggest improvements to the current process.
Based on my very extensive experience in this area I am clear on two points:
First, progress to date has been achieved on the basis of mainstreaming European debate into policy discussions.
The European dimension is too vital to set aside in parliamentary deliberation. For that reason I believe that European scrutiny must continue to be a prerogative of both Houses. Anything else would be a regressive step.
Second, that timing of when engagement occurs is vital. There is little point in any T.D or Senator engaging in a policy discussion when, for example, a Statutory Instrument is due to be transposed. It is too late. We must therefore enable Oireachtas engagement at the most effective time.
An Open Europe
While improving the role of the Oireachtas within European scrutiny is part of this agenda, it is not the entirety. I am prioritising progress in three other specific areas:
First - supporting the development of the Blue Star Primary School Programme. I have already seen first hand the impact of this programme in helping our young kids gain an appreciation of the diverse cultures of Europe and the value of the EU to Ireland. Under the stewardship of EMI, the Programme has performed well.
Second - developing an equivalent plan for such a scheme at Secondary level. Transition Year offers a great opportunity to offer young minds the chance to build on their learning of the workings of the EU and an understanding of the cultures, languages and history of Europe, which underpins it all. I aim to have a recommendation for such a plan ready by March 2014.
Third - consideration of how we discuss Europe with the age group between 18 and 24. Initiatives like Digital Europe and the Youth Guarantee offer not only a great opportunity to play a meaningful role in the lives of young people but also offer a platform for us to make a bigger effort to engage with this group. It is on their shoulders that the future rests and their voices need to be heard.
Effective in Europe
This refers to how Ireland structures engagement with Europe. Two events have defined our recent relationship with the EU and, indeed, the broader world: our recent Presidency and our participation in the Troika-led Programme of Official Aid.
In July, we wrapped up the Presidency, our seventh in forty years - yes, this is the fortieth anniversary of our EU membership! We will also exit the bailout programme by Christmas becoming the first Eurozone country to successfully do so.
We therefore have an ideal opportunity to refresh our relationship with the EU and its Institutions, to identify our priorities for the coming years and review how we are going to achieve them.
In supporting the Taoiseach and Tanaiste, one way I am playing a role in this is through the chairing of an Inter-Departmental Committee of senior officials set up to intensify engagement on EU affairs across Government. The work of this group will inform and complement the activities of all Departments in ensuring that we are always optimally engaged with the EU on our national priorities.
This brings be on to conclude with comments on the some of these priorities facing Ireland and Europe, particularly the strengthening of European Monetary Union, the nature of the relationship between Ireland, the EU and the UK and the consequences of the economic crisis on European and Irish politics.
The UK and the EU
Let me begin with a reference to the current British debate. As I have said to my UK counterpart, David Lidington, in our very constructive exchanges, the European Union is stronger with the UK in it, as a positive and committed member.
Not just because of the strength and importance of the relationship between our two countries but because of what the UK brings to debates and decisions within the EU.
As a country which frequently votes on the nature of our relationship with the EU we respect the debate underway there.
But it is vital to recognise that certain possible outcomes to this debate could have profound consequences for Ireland and for our relationship with the UK. So I want to emphasise two crucial points:
First – while our membership of the Union, like every other EU country’s membership, brings its own particular challenges, the underpinning rationale remains compelling: participation in collective decision-making enhances our sovereignty, it does not erode it.
Ireland is an integrated and committed member of the EU community. And will remain so.
On such a vital topic of national interest we will not be caught in the slipstream of decisions that others make.
Second - we welcome the discussion on the role of member states within the EU.
But I am worried about the consequences of a discussion on the role of the UK outside of the EU. Suggestions that not much would change in practice are wide of the mark.
Both of our countries work together as equal members of the Union. We are inside the tent, together. If we have to meet at the door of the tent to do business then this relationship will change. This should be avoided.
Forty years ago, Ireland and the UK took a step together which had the most profound effect on both our countries. I would defy anyone to say that this has not been for the better.
In 1973, Ireland and the UK took that step because we believed that our people would be best served through the realisation of that natural tendency I referred to earlier - to share, communicate and exchange within a community of equals.
That has not changed in those forty years.
Strengthening Economic and Monetary Union
The economic crisis has raged across national borders. Contagion, never a nice concept, has now acquired a powerful economic resonance. Much of the response to this crisis resides within national borders. Ireland has shown an unrelenting determination to fix all we can fix through tackling our national finances, regaining our competitiveness and prioritising job creation.
However this effort will work best when supported by a stronger economic union. It is now apparent that we created a currency union, but not an economic union. The European Semester process and the Fiscal Governance Treaty are all crucial elements that have filled this gap. But the missing foundation stone is the building of a robust and credible banking union.
This is vital - not only for Ireland but for Europe. We have learnt through bitter experience that when an individual country is unable to answer questions about how they regulate banks or deal with the costs of their failure the difficulties for society are immense.
Specifically we must ensure the appropriate use of European financial back stops supported by a strong and independent regulatory regime. For regulation to be European wide but the costs to be national is not a sustainable equilibrium.
And I want to conclude on that concept of a sustainable equilibrium. Perhaps better expressed by paraphrasing W.B Yeats by asking whether the centre can hold?
Children starting in our primary schools this year were born at the start of this crisis. While they are not aware of this crisis their parents certainly are. It has been a long and extraordinarily difficult 5 years.
The challenge that we face is that many now doubt the success of current levels of economic and political integration. Indeed, some believe that these levels of integration are the cause of the crisis. At the same time we ask for their support for more integration.
We must be aware of this tension. A similar tension exists in relation to bail out programmes. No country wants to be in a programme. At the same time other countries are understandably reluctant to fund them.
These undercurrents must be recognised and we must respond to them.
First, by how we talk about this crisis and second, by demonstrating the clear rationale and benefit of any future changes. The rationale for integration can no longer just be its own logic.
More broadly, we must make the case for Europe while acknowledging its difficulties and fixing these flaws. I spent the first portion of my speech making the case for Europe - to an audience probably already convinced.
Our natural instinct is to co-operate and the European Union represents the best way of doing this in the face of challenges and opportunities too big for any country to deal with on their own.
Luuk Van Middelaar, the Dutch political philosopher recently wrote of the European project that, “no one ever sails on an ocean of certainty” and argued that, “when a storm becomes too fierce and the wind blows your boat towards an open sea, it is better to have a good compass than an anchor”.
This compass is our membership of a Union which we voluntarily joined, which allows us participate in choices that impact our people. If we were not at the table the choices would be made anyway and our people would still feel their impact. So, far better to be present.
But, to be present is not enough. We participate. We engage. We influence. This is what is needed to make a difference to our people and those of Europe. Our recent Presidency of the Council of the European Union was, we believe, an example of this.
If I began with 'Gangnam Style' it feels only appropriate that I should end with Lou Reed - though God knows what he would think of inclusion in this sentence let alone this speech.
He sang 'You're going to reap just what you sow'. Despite our current difficulties we have benefited, we have contributed and Europe will play a crucial role in our recovery.
But, this political structure, unlike a physical one, required that foundations be always relaid, always replenished through the continued consent of our people.
In my time in this role, and in the commitment of our Government, I am determined to play my necessary part in this work.