Illustration by Peter Schrank (economist.com)
From The Economist print edition
It is easier to influence a country before than after it joins the club.
GROUCHO MARX once said that he did not care to belong to a club that accepted people like him as members. The European Union has a slightly different problem. Lots of countries want to get in, even though many of them, and indeed some that have already made it, are not fit to join. They seem to hope that EU membership will work miracles of its own, curing such ills as entrenched corruption, organised crime, judicial ineffectiveness and economic backwardness - all without their having to make painful reforms at home.
Consider Bulgaria, which joined the EU (with Romania) on January 1st 2007. The interior minister, Rumen Petkov, has just been forced to resign, after the 120th in a string of unsolved contract killings; he has admitted being in contact with suspected crime bosses. Last year the Romanian government dumped its bravely reforming justice minister, Monica Macovei, on the dubious argument that she was not a team player. Both countries do badly in the annual corruption rankings put out by Transparency International, a Berlin-based lobby group.
And they are by no means alone. In every one of the eight central and east European countries that joined the EU on May 1st 2004, reforms have since stuttered or halted. Anti-corruption drives in the Baltic countries have stalled. Slovakia, once the star among the region's economic reformers, has fallen to earth with a vengeance. Poland, the Czech Republic and Hungary have all been criticised for their slow pace of reform.
A common feature in all these tales is the limited leverage of Brussels. It is often said that the EU's enlargement policy has been the most potent tool yet devised to entice its neighbours along the road to free-market democracy - far more effective than anything the United States has found to wield over its southern neighbours. But the corollary is a loss of influence after a country actually joins. The pattern of intensive reform to qualify, followed by a let-up in the process once membership is achieved, is too common to be mere happenstance.
Olli Rehn, the enlargement commissioner, concedes sadly that "after a country has a seat round the table, it is much harder to apply pressure to it." This, he adds, is why the European Commission has introduced benchmarks and closer scrutiny into the pre-accession phase. Even after accession, the commission can withhold farm subsidies and regional aid, as it is threatening to do for both Bulgaria and Romania. Another sanction in their accession treaties is that other EU members may refuse to recognise court judgments. Yet most post-accession sanctions are like nuclear weapons: threats that may be counter-productive actually to use. They have none of the power of pre-accession talks, when a single mis-step can easily mean another year of delay.
Politics always intervenes, in any case. In 1981 few countries considered Greece to be suitable for membership of the club, but none dared to incur the ignominy of vetoing it. In the run-up to 2004, some tried to differentiate among the east Europeans, giving membership only to leading reformers. But politics tipped the balance in favour of a "regatta", under which all but the Balkan pair came in at once. Bulgaria and Romania were then guaranteed membership in 2007 or 2008, which instantly eased the pressure to keep reforming. A similar story played out with Cyprus in 2004: the moment its EU membership was secured, the urge to reach a settlement with the Turkish-Cypriot-controlled north of the island ebbed away.
Is there a better way to keep up pressure? Mr Rehn's benchmarks and monitoring may help; so might offering or withholding cash. Yet the only sure method is to keep membership tantalisingly near, but not actually to offer it. Croatia, Turkey and Macedonia all now have a big incentive to change, because they want to join. And Turkey shows the limits of this approach: since many Turks believe they will never get in, no matter what they do, they wonder why they should bother with more reforms.
Good and bad members
There is another big problem with this game: the behaviour of old EU members. Mr Rehn notes that, if one took the worst features of every old EU country, one could easily come up with an amalgam that would barely meet any of the criteria for EU membership. To take just one example often cited by new members, Italy can hardly claim to be free of organised crime.
Perhaps the most telling case of one rule for new members and another for old ones has come with the single currency, the euro. The commission and the European Central Bank insist that they must be rigid in applying to new EU members the "Maastricht criteria" before they can join the euro. Lithuania was rejected in 2006 because its inflation rate was just 0.1% over the prescribed minimum. Slovakia, which hopes to get into the euro next January, is being subjected to similarly fierce checks.
Yet the rules were openly bent to admit Belgium and Italy in 1999. Greece, which adopted the euro in 2001, subsequently admitted that it had done so with made-up budgetary figures. Several countries that had struggled to cut public borrowing to qualify for the euro stopped their fiscal reforms the moment they were let in. And when the two biggest, France and Germany, fell foul of the stability-pact ceilings on budget deficits in 2003 and 2004, they responded not by doing their utmost to get back in line but by tearing up the pact itself. Nobody dared to suggest that they should be subjected to the enormous fines specified in the pact for persistent offenders.
The Lisbon treaty offers a few other sanctions, notably the suspension of a country's membership rights by a majority vote of other members. It also contains the novelty of an exit clause, letting a country leave (though not yet giving the EU the power to throw a recalcitrant out). But you can bet your bottom euro that neither of these will be used to raise the club's standards. Groucho Marx would not have approved.
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