Another credibility problem for Europe?

The Slovak parliament has voted against ratifying the Eurozone’s bail-out mechanism.

The Slovak vote, and what it represents, is very important. What a small country thinks about Europe is just as important as any the views of any big country. That’s the essence of democracy in practice.

There are of course echoes of the deeply uncomfortable second Irish vote for the Lisbon Treaty in the recent Slovakian parliament vote to reject a key part of the bail out for the Eurozone. This is because Slovakia’s parliament will vote again soon. For the cynics, this will be in order to get the right result.

The fact is that Slovakia, one of the EU’s poorest countries, is a country which has become more prosperous and confident within both the EU and the Eurozone. It’s also the final country to vote on the EFSF – the European Financial Stability Fund – and they are considering the issue seriously. The Slovakian vote, regardless of outcome, is therefore symbolic of how Europe works, the difficulties in the Eurozone and of democracy itself in Europe.

It’s absolutely worth analysing these three issues, in turn and seriously, and I believe firmly coming to a non-Eurosceptic conclusion.

Let us address the first point, that of how Europe works. A key criticism of Europe has always been the “vote until you get the answer you want” critique. We saw this with the double Irish vote on Lisbon, returning first a slim “no” and then a slim “yes”. Whatever else that represented, it was certainly a major credibility problem for Europe.

Slovakia’s “no” vote on the EFSF represents something very different.

Domestic politics – a crucial confidence vote – played a large role in the “no” vote. As did the fact that our sister socialist party in the Slovak Parliament abstained, but is expected to tip the balance and vote “yes” next week. So while Slovakians may be voting twice on the same issue, it’s purely down to Slovakians as to how many times they’ll vote.

All fine, but what of the underlying anger behind the “no” vote in Slovakia – that second issue of difficulties in the Eurozone? This anger is very real, and very understandable. As far as the Slovakians are concerned, their fiscal discipline – their taxes – should not go towards helping the Greeks.  In December 2009 Greece admitted it had debts of 300 Billion Euros – 113% of GDP. Slovakia is a poorer country than Greece, and doesn’t want to see its government’s revenue go to helping out a spendthrift nation – however proportional Slovakia’s contribution will be.

Here, however, we can come to the key political issue of the Eurozone crisis. Those Eurozone members who have done well out of their Eurozone membership in part did so because the currency is a shared project. Take Germany. The engine of Europe’s economic growth has been export-led, aided by a Euro depressed in value against where the old Deutschmark would be in part due to the presence of countries like Greece in the currency. What we’re talking about is a Greek share in German success, and likewise in Slovakian. Anyone who has been a member of the Euro has contributed to the Euro’s success stories too.

Slovakians know this, and understand their interests like with a secure Euro.

Here we come to the third point – democratic governance in Europe. The Eurozone is the issue that has exposed the Eurosceptic argument on this score. One the one hand, Eurosceptics have spent years hammering the EU for a “democratic deficit”, over-large government, and excess of powers. Now, when whole economies are at risk, the same voices have joined in calling for more action and a centralized response.

But Slovakia voting on that response, and Slovakia choosing its own timing, is the best possible answer to those Eurosceptics first wishing for, than sneering at, Europe’s lack of centralised authority. Slovakia is showing how Europe can function – even under extreme pressure – with the sovereignty and due diligence of its national parliaments at its heart.

Slovakia will make a decision on the EFSF – but before we start listening too closely to those who say this “no” vote is a sham or failure, we should remember that more democracy, not less, is always a good thing.