Neo-Functionalism and European Integration
Neo-Functionalism
Haas:
Shift of loyalties, expectations, and political activities towards a new center that demands jurisdiction. End result: a new political community, meaning that decisions are legally binding and loyalties have been transferred to the “supranational” level of government.
Lindberg:
Nations seek to make joint decisions or to delegate the decision-making process to new central organs. Political actors are persuaded to shift their expectations and political activities to a new center.
Shared Traits of Both Definitions:
- Integration as a process, not a condition
- Involves some degree of institution-building in the new center
- Changes in expectations and activities on the part of political actors
Dependent Variable: “New Political Community” (Haas)
Political integration results in building a political community with political units as its contents. This is achieved by establishing the same frame of rules, creating common institutions with decision-making power, and projecting an identity of the integrated community (instead of previous identities of the political units). The main point is delegating the autonomy of political units to the newly formed political community.
Variables in the Process of Political Integration
- Independent Variable 1: Period
- Independent Variable 2: Delegation of sovereignty
- Dependent Variable: Process of political integration
Functional Spill-over
Some sectors within industrial economies are so interdependent that they cannot be treated in isolation. Attempts to integrate certain functional tasks will lead to problems. Jean Monnet believed that integrating basic industries (coal, steel, travel) must lead to a need for integration, first of other energy sectors and later of the whole economy. He proposed integrating just number 1, anticipating problems would arise, and waiting until the state figures out it needs to integrate 2 and 3 to solve the problem.
Political Spill-over
Groups (Elites/bureaucrats, e.g., representatives in Brussels): The minds of these representatives change, seeking solutions on a supranational level and refocusing loyalties and expectations to a new center. This reorientation leads to calls for further integration, providing the process with political impetus.
Lindberg stressed the importance of governmental elites, noting that the EEC led to a vast bureaucratic system involving thousands of officials in continuous decision-making. Haas focused on non-governmental elites, examining the behavior and perceptions of leaders of political parties, trade associations, and trade unions. Such groups generate pressures that spill over into the federal sphere, adding to the integrative impulse.
Cultivated Spill-over
Haas + Lindberg emphasized the role of central institutions, specifically the Commission’s need for an active leadership role.
Spillback
Neo-functionalism before De Gaulle was perhaps too optimistic about cooperation, excluding the potential for conflict and disintegration. Neo-functionalists later introduced the concept of spill-back, referring to withdrawing from specific obligations. Rules are no longer enforced or obeyed, and the scope of Community action and institutional capacities decrease.
Spill-back occurs when member states no longer want to deal with a certain policy issue at the European level. Due to changed or diminished interest, previous coalitions shift, undermining deals and commitments. The relevance for member states to demand solutions from the European political system is crucial for the sustainability of European integration. If the “demand flow” dries up, European integration shrinks.
Low vs. High Politics
Intergovernmentalists believe that neo-functionalism is flawed because it assumes that integration in low politics (e.g., economics) will lead to integration in high politics (e.g., sovereignty). They argue this is impossible since high politics issues are integral to national interest, and integration would only be possible when national interests coincide, which is unlikely.
Empirical Developments that Challenged Neo-functionalism
The theory lost favor after failing to address criticisms from intergovernmentalists or explain contradictory empirical evidence from the 1960s. By the early 1980s, intergovernmental elements had been strengthened at the expense of the supranational, the Community seemed increasingly paralyzed, and the prospects of major spill-overs appeared to have waned.
Criticisms
1) Empirical:
The EC didn’t progress as expected; integration stopped, rendering the theory invalid.
2) Theoretical:
Stanley Hoffmann, a prominent intergovernmentalist critic, posited the “logic of diversity” as a countervailing force to the “logic of integration.” This force, he argued, is based on differences in “domestic determinants, geohistorical situations, and outside aims.” Because of the logic of diversity, Hoffmann considered it a major flaw that neo-functionalists neglected the EC’s external environment. He saw the logic of diversity as the fundamental dynamic principle of the global international system and ruled out that it would be possible to insulate a particular region from its effects. Hence, the external environment would tend to provoke diverse responses from the member states, which in turn would create divisions and prove disintegrative.
Moreover, neo-functionalists failed to understand the difference between low and high politics. The former concerns relatively uncontroversial welfare issues, while the latter deals with issues such as defense and foreign policy. Hoffmann argued that the logic of integration might be stronger in low politics, but in high politics, the logic of diversity would prevail. Hence, there would be no spill-over from economic to political integration – the hard core of sovereignty would remain intact.
The Interdependence Critique
Interdependence theorists and neo-functionalists share assumptions and concerns associated with the “pluralist” or “cobweb” image of international relations. Interdependence theorists criticized the teleological and regional orientation of neo-functionalism. They considered the assumption that the EC would eventually develop into a new political unit centered around the Commission as teleological. Interdependence theory, on the contrary, does not necessarily imply integration, and where it occurs, theorists do not favor any particular institutional outcome. Interdependence is a condition, not a process, and its possible integrative consequences are based on political acts not predicted by the theory.
The Response of the Neo-Functionalists
Responding to De Gaulle and Hoffmann’s objections, neo-functionalists first abandoned the “automaticity” of spill-over. Haas argued that De Gaulle’s resistance did not disprove the theory but made it necessary to specify the conditions under which it applied. He contended that the logic of integration depended on the goals of statesmen and non-governmental elites. Lindberg developed a more comprehensive analytical framework based on David Easton’s systems model of domestic politics. Spill-over continued to play a role but was reduced to one mechanism among others.
Years later, Haas grew disenchanted with neo-functionalism, downgrading it to one “pretheory” among others. He later concluded that “the familiar regional integration theories are obsolete in Western Europe and obsolescent – though still useful – in the rest of the world.”
Neo-functionalist Mechanisms in the Late 1980s
Despite its failings, neo-functionalism experienced a revival in the late 1980s as European integration gained momentum with the Single European Act, a clear step toward further integration. “Functional spill-over” was suggested as the cause; the removal of tariff barriers generated a demand for “harmonization of product standards” within the EC. Revival theorists argued that supranational institutions played a pivotal role in the EC and that the European Court of Justice and the Commission both pursued deeper European integration through their powers. Many revival theorists failed to address major criticisms, but some salvaged aspects of the theory.
The new theories of neo-functionalism differentiate themselves from the old by distancing themselves from “grand theories” of European integration. Alec Stone Sweet and Wayne Sandholtz devised a theory that borrows from neo-functionalism but only looks at how supranational governance evolves, rather than theorizing the whole integration process. At the center of their hypothesis is the rate of transnational exchange, which they argue has been the “catalyst of European integration.” Supranational authorities serve the interests of those who operate across borders by producing rules relevant to their needs. Consequently, when the rate of transnational exchange increases, there will be more interest in the supranational authority. However, Stone Sweet and Sandholtz include a caveat: their thesis does not mean that specific details or timings of rule-making within the EC can be predicted. Their conclusions borrow from neo-functionalism. They see the integration process as driven by the interests of political actors (governmental or not) and argue that EC supranational institutions push for further integration for instrumental reasons similar to those identified by classical neo-functionalists. Yet, they do not make the bold claims of the classical neo-functionalists. They argue that self-interested actors pressure supranational institutions, which will grow at the expense of national sovereignty, but they do not believe this will be the only mechanism determining European integration’s fate.
Logic of Diversity
Intergovernmentalism emphasizes the logic of diversity. Hoffmann argued that in areas of key importance to the national interest, nations prefer the certainty, or the self-controlled uncertainty, of national self-reliance. In short, where an issue was considered important enough, national governments would be effective gate-keepers, protecting and promoting their policy preferences. This can be best demonstrated by the difficulties of implementing the Economic and Monetary Union (EMU) in the 1990s. This collective action was once hindered by the member states because of the problem of diverse national interests. For instance, the United Kingdom has stayed out of the Euro, concerned with its domestic interests. Along with further integration of the EU, intergovernmentalism needs to be improved to explain systematically this process from the liberal perspective. Thus, intergovernmentalism was revised and presented in the form of liberal intergovernmentalism by Andrew Moravcsik.
Assessment of Neo-functionalism’s Virtues and Limitations
Limitations:
The most obvious limitation is that the logic of spill-over has been more evident in some periods than in others.
Countervailing Forces
Neo-functionalism is mainly a theory about the dynamics of integration. Countervailing forces, which constitute the other side of the equation, were always implicit in neo-functionalist writings but were never subjected to the same degree of scrutiny, and their importance was underemphasized.
One countervailing force is the continued adherence to the symbols of sovereignty by “dramatic political” actors. Between 1958 and 1969, it was De Gaulle who epitomized this force, while between 1979 and 1990, it was Thatcher. Both had a constituency for nationalist ideas among the public. Their success reveals the weakness of a framework confined to the perceptions and activities of elites. Although integration may be propelled by the pragmatic pursuit of group interests represented by a small layer of people, it cannot continue indefinitely without some degree of European community feeling among the wider public. At least, there must be what Lindberg and Scheingold have called a “permissive consensus.”
Another countervailing force arises from the sheer diversity of the member states. Especially after the latest enlargements, the member states display considerable social, economic, political, and administrative differences. This may make it difficult to move from negative to positive integration because such moves involve agreement on common substantive policies.
These two forces, nationalism and diversity, limit the effects of the logic of spill-over. In the decision-making process, they are represented by the governments and are channeled through the Council, the COREPER, and the vast system of sub-committees.
Forces that Promote or Impede Integration
In addition to the logic of spill-over and the countervailing forces, other factors have sometimes proved integrative and sometimes disintegrative.
The factor most emphasized by Hoffmann is the external security environment. However, the first dynamic phase of the EC took place during the First Cold War, while “the new dynamism” coincides with a climate of détente and cooperation. Hence, there is no simple relationship between an external threat and integration, as contended by some intergovernmentalists. Nevertheless, the breakdown of bipolarity and the reforms in Central and Eastern Europe constitute such a dramatic change in the Community’s external environment that it is bound to have an impact. Contrary to Hoffmann’s original expectation, foreign policy and even aspects of security have not remained a complete “no-go area” for the EC. One consequence of the change is to provide new opportunities for political cooperation. This is already the case with regard to economic assistance to Eastern Europe, where the Commission has been invested with a mandate to coordinate the efforts of the OECD countries. As of now, however, it still remains to be seen whether the overall impact of these developments will be to further enhance or impede integration.
A closely related “high politics” consideration is security within the Community, especially in light of German unification. It does not seem certain that German unification will prove disintegrative. On the contrary, it appears to have strengthened the Franco-German resolve to speed up the integration process, as illustrated by the moves towards Political Union and setting a date for the transition to stage two of the Delors Plan.
Finally, the Community is part of a world characterized by global interdependence. The existence of areas where interdependence is stronger among the members than between the Community and the surrounding world serves as a rationale for common policies. On the other hand, the truly global character of interdependence makes it necessary to cooperate with non-member states. In some cases, member governments respond to this need by creating new international fora or utilizing existing ones outside the EC framework. In other cases, cooperation with the surrounding world is carried out collectively through the EC machinery. An interesting development in this respect is the tendency to “open” Community policies to outside countries, as is the case with some research programs and with the European Environment Agency.
Conclusion on the State of Neo-functionalism
The integration process encompasses factors that can be more adequately handled with the tools of intergovernmentalism and interdependence theory. At the same time, the important role played by the mechanisms of functional, political, and cultivated spill-over since 1985 makes neo-functionalism indispensable to understanding European integration.
The obstinacy of the logic of spill-over implies that neo-functionalism is by no means obsolete. In terms of Puchala’s analogy, neo-functionalism may still only be dealing with some parts of the elephant, but it appears that those parts are among the ones that make the animal move.