XX Century CAPITALISM

 

Jean Monnet :

 Theories on European Integration


By  Jessica Becker

“The nations of Europe … will need larger markets … Prosperity and vital social progress will remain elusive until the nations of Europe form a federation or a ‘European entity’ which will force them into a single economic unit.”
            ~Jean Monnet, 1943
[1]

 

I.  Introduction

 

Jean Monnet was not a diplomat, a politician, nor a scholar.  He has been called a “non-specialist in any field”[2].  Not even officially an economist, as he received no higher-level education after the age of 18, his entire life was nevertheless inextricably intertwined with endeavors to implement his economic theories on economic integration of Europe as a means to facilitate political integration.  It was Monnet who was responsible for the planting of the seeds of economic integration that has grown into today’s European Union.

 

II. A Life Intertwined with economics

 

  a.  Independent Endeavors

Jean Monnet was born in Cognac in 1888 to a family of winegrowers.  At 18, he decided to travel to Canada with samples of his father’s wine instead of continuing with his education in France.  Monnet’s business savvy and appealing personage led to the selling of all of the samples and then some.  As he traveled from Canada to America to Egypt and Europe, he befriended influential wine aficionados and businessmen around the world, and his father’s wine company became an immensely successful and lucrative business.

 

b.  World War I

By age 26, Monnet ventured back to Europe when rumors of war developed in 1914.  After learning that the British and French were to ally, and witnessing the chaos of competition between British, French, and companies of other countries to supply commodities for the fight, Monnet believed that economic coordination was essential to efficiently gather the necessary supplies. 

Thus, he launched his first high-level attempt at seeing to the implementation of economic integration as a means of facilitating political cooperation and empowerment.  He convinced high-level French and British government officials to create purchasing agencies to coordinate the government’s purchase of supplies.  Monnet’s talent for resource allocation became indispensable to the governments of Britain and France, and he quietly gleaned a highly respected reputation by influential politicians for his endeavor.  When the League of Nations was established in 1919, Monnet was appointed Deputy Secretary-General, where he worked greatly on economic programs in post-war Europe*.

In 1923, he returned to France to save the family wine business from financial trouble, and within two years it was operating strongly again.  Through the 1920s and 1930s he traveled and offered ideas to alleviate economic distresses for the governments of the United States during the stock market crash of 1929 and the following Great Depression, Sweden, and China.

 

c.   World War II

By the late 1930s it was evident that a second world war was imminent.  Thus, Monnet answered the call of duty by assuming a role similar to that of his role in World War I, again asserting the necessity of Allied union in the purchasing of supplies.  His efforts led to his appointment to head the Anglo-French Coordinating Committee once war was declared.  When it became clear that France was about to be completely overwhelmed by Nazi forces in 1940[3], it was Monnet who proposed a plan of English and French union, in which citizenship, currency, resources, and more would be shared and France would be saved.  Before this idea was approved, France was forced to surrender to the Nazis.

Monnet then traveled to London from France to work with the British government as an intermediary to America.  He believed strongly in the importance of American participation to the Allied war effort, and had close interaction and counsel with President Roosevelt.

 

 d.  Post-World War II

In post-war France Monnet was appointed French High Commissioner of the modernization plan for France, his Schumann Plan, which led to the formation of the Economic Coal and Steel Community.  His position allowed him to directly influence provisions in the Atlantic Pact and the Brussels Pact (the precursor to the American-included North Atlantic Treaty Organization, NATO).  He also managed to get some funds from America’s European Recovery Plan, the Marshall Plan, allocated to western Europe and especially France, which had been devastated by the destruction of the war.  These funds were helpful for his plan for France’s modernization**.  In the economic aspect of this recovery he attempted to create an organization for European economic cooperation (OEEC).  While a failure because it couldn’t survive when the British withdrew support, it paved the way for the decrease in protectionism in Europe, especially in France.[5]  His theories on integration were also applied to the Pleven Plan, or the European Defense Community, and the 1957 Treaty of Rome, which established the Common Market.

 

 e. Disillusionment

The European Defense Community (EDC) was one of the establishments Monnet rested great hope on as an institution that would lead to greater European integration.  When the EDC was thwarted in French Parliament in 1954[6], Monnet was disappointed, especially because it was defeated in his own country of France.  His frustration was exacerbated by the lack of progress in the ECSC, and he turned in his resignation as President of the High Authority in 1954.  Later, he attempted to withdraw his resignation, when person re-evaluations led him to the conclusion that he could do more to convince people of the benefits of integration from inside rather than out.  However, he was unable to do this[7].  Therefore he was resolved “to continue the struggle for political and economic integration outside the formal institutional structures – becoming, in a sense, Europe’s first lobbyist.[8]

He wrote his memoirs, which were first published in the United States in 1978.  He dedicated his life to his idea of a united Europe, sometimes even against French politicians determined to safeguard sovereignty[9].  He died in 1979, largely unknown to the masses but admired and essential to many government officials and policy-makers across Europe and the rest of the world[10].  

 

III.   Economic and Political Theories

 

a. The First Monnet Plan (The Schumann Plan ŕ ECSC)

After Allied victory, it was Monnet who negotiated a $650,000,000.00 loan from the United States to rebuild France.  In order to attain these American funds, he recognized that French protectionism must be halted, so that Americans could more easily export goods produced in its post-war economy.  He insisted on modernization, the importance of free trade, and stopping inflation.  To do this, he proposed a cutback in military spending to Minister of Finance Pleven (later Prime Minister of France).  His seven-page plan was accepted and led to his appointment as High Commissioner[11].  The young post-war government acquiesced to Monnet’s expertise because of his “authoritative, simple ideas and concrete solutions.[12]

Then he focused on rebuilding and strengthening Europe.  Like many French politicians and the general population, Monnet at first worried about including Germany in economic rebuilding plans.  However, he realized that in order to solve the German problem, it would be best to re-integrate Germany into the rest of Europe.  He believed that a strong German economy could be exploited to benefit the rest of Europe, and an impoverished Germany would be bad for Europe as a whole.  Economic integration, then, would lead to political integration, as countries dependent on each other for financial stability would be averse to aggression.

 

Germany had large amounts of coal and France had large amounts of iron ore.   What Monnet envisioned was a centralized internationalization of the Rhineland and Lorraine.  While the concept of centralization suggests socialism, Monnet considered it to be capitalist in that it was a common market (followed principles of a free market economy).  More specifically, he saw that the economic agreement would have political repercussions, as “this plan for a single coal and steel market … could eradicate war, reconcile France and Germany, and enable the Germans to be treated as equals.”[13]  After Monnet shared his idea with French Prime Minister Schumann, the plan became known as the Schumann Plan[14].  It was proposed to the new German Chancellor Konrad Adenauer, who very eagerly agreed to the pooling of the coal and steel resources.***

In April of 1951, the coal and steel pool was officially integrated as the European Coal and Steel Community (ECSC).  The six countries of France, Germany, Italy, and Benelux (Belgium, the Netherlands, and Luxembourg) comprised the ECSC[15].  However, while it included those six countries, it was primarily seen as a union between France and Germany to deal with political worries remaining from the memories of the aggression of the two world wars.[16]  Nevertheless, Jean Monnet became the first President of the ECSC, and had first-hand opportunity to see his theories be put into practice and, hopefully, gain momentum to strengthen and grow into greater integration.

 

b.  The Second Monnet Plan (The Pleven Plan ŕ EDC)

A joint army for the six countries that joined ECSC, with Monnet able to acquire support for the plan from General Eisenhower in America, was enacted in the early 1950s.  This single military organization would, according to Monnet, cut down on the bureaucracy of negotiating with six separate armies and their bureaucracy with the recent war in Korea that had begun in 1950.  Also, the issue of the fear of German aggression was raised again, as western Europe feared German rearmament, but Monnet recognized the necessity of integrating them into the group, thereby creating a stake for Germany to cooperate with the group.  The army was called the European Defense Community (EDC), and it was to be joined by the six members of the ECSC.[17]

 Monnet developed this concept of a common army.  It is considered the Second Monnet Plan, with the ECSC known as the original Monnet Plan, and was eventually known as the Pleven Plan.

The ECSC and EDC were inter-related, although the ECSC was primarily economic and the EDC political.  Monnet had high hopes for the EDC, but it was doomed to fail.  “The High Authority of the Steel and Coal community was organized within a highly structured, supranational framework, independent of the states.  The EDC was being set up in the same way, but it compounded the weaknesses of the other organization.  At the very moment that the European army was declared to be a supranational institution, the various governments were demanding that they be allowed to retain control over their own army units and that decisions be made on the basis of majority rule.  They claimed the right of veto.[18]”  Ironically, the EDC was thwarted in French Parliament, Monnet’s home country, in 1954.  The French were too preoccupied with worry over the concept of German rearmament, and were not ready to devote to a European army.  Memories of World Wars I and II were too strong for complete political dependence.[19]  The Second Monnet Plan was a failure.

 

c. The Treaty of Rome  EEC {European Economic Community} &

EURATOM {European Atomic Energy Community})

 

 Jean Monnet believed the states of Europe should give up national self-determination, which had caused countless wars on the continent of Europe for centuries, unify, and integrate so together grandeur can be re-captured and Europe would not recede into insignificance in the face of the cold war[20].  His concept is reminiscent of the economic principle of economies of scale, which states that efficient production of goods can be maximized and costs can be minimized with increased size.  Integration of Europe is thereby similar to corporate mergers, with individual countries uniting to exploit economies of scale.  Jean Monnet felt that such economic integration and expansion would lead to political cooperation, and to European eminence.

The previous endeavors and ideas of Monnet, such as the ECSC and EDC were incorporated into the formation of the European Economic Community (EEC), also known as the Common Market, and EURATOM (European Atomic Energy Community).  They were established by the signing of the Treat of Rome in March of 1957, signed by the original six countries that joined the ECSC, France, Germany, Italy, and Benelux.  The Common Market was the basis of today’s European Union.  Its primary goals included the western free market economic and democratic political concepts of:

1.  Free flow of production factors (capital and labor);
2.  A common external tariff;
3.  A common agricultural policy;
4.  A European Parliament.
[21]

Monnet’s plan of European integration via small steps, such as the establishment of first the ECSC, followed by the attempted EDC, for example, bore fruit with the Treaty of Rome[22].

 

IV Political Beliefs in the Cold War World

 

“In a capitalist country, the first experience with economic planning should not be the task of an administration,” Monnet said, “but the result of concerted action.[23]”  After World War II, France became a prime example of a mixed economy, with government planning of economic endeavors[24].  The French government pursued indicative planning, in which “the market serves as the principal instrument for resource allocation, but a plan is prepared to guide decision making.[25]”  Monnet was an influential member of planning committees in post-war France, as five-year plans were introduced with various capitalist themes such as development of specific sectors (like coal, steel, agriculture, etc.), productivity, and “economic growth and the foreign sector.[26]

Monnet himself never denied his own political support of Socialists in French elections, with one exception when he voted for a non-socialist candidate who backed European integration.  “Socialism to me means nationalization of the public services and the major means of production, but not the nationalization of enterprises in which private initiative has a daily role to play.[27]

 

V.  The Legacy of Jean Monnet: 

The European Union’s Jean Monnet Project

 

He believed economic integration would lead to political integration, a United States of Europe, which would benefit Europe as a whole.  More of a representative for the world rather than a representative of France, he had close relations with America and the British.  When French politicians and businessmen were intent on seeing Germany kept powerless after the Second World War, Monnet urged for union.  His life was devoted to supporting the implementation of supranational European coordination.

Jean Monnet’s legacy as one of the earliest and greatest supporters of European cooperation is remembered today by the European Union.  The EU created the Jean Monnet Project in 1990, which aims to encourage the introduction of European integration courses at universities throughout Europe.  According to europa.eu, the European Union online, “the term European integration studies is taken to mean the construction of the European Community and its related institutional, legal, political, economic and social developments.[28]” 

Thus, Jean Monnet’s devotion to European integration is remembered through the EU’s Jean Monnet Project.  Through the institution he believed so passionately in, the project is a dedication to his legacy and continues to build the foundation for education on European integration.

 

Bibliography

Bromberger, Merry and Serge, Jean Monnet and the United States of Europe. New York: Coward-McCann, Inc., 1969.

Dublin European Institute, The Jean Monnet Project at University College Dublin (Online), May 23, 2002.  <http://www.ucd.ie/~dei/jmonnet.htm#The%20Jean%20Monnet%20Project>.

Duchene, Francois, Jean Monnet, The First Statesman of Interdependence, First Edition.  New York: W. W. Norton & Company, 1994.

Dyker, David, The European Economy, First Edition. New York: Longman Publishing, 1992.European Communities (The European Union Online), 1995 – 2002.  <http://europa.eu.int/comm/education/ajm/ajm/index_en.html>.

 

Gregory, Paul R. & Stuart, Robert C, Comparative Economic Systems, Sixth Edition. 

Boston: Houghton Mifflin Company, 1999.

Keylor, William R., The Twentieth Century World, an International History, Fourth

Edition. New York: Oxford University Press, 2001.

Keylor, William R., Boston University, HI 350 Lectures, Spring 2002.

Kyn, Oldrich, Boston University, EC 395 Lecture, January 16, 2002.

Monnet, Jean, Memoirs, First Edition. Garden City, New York: Doubleday & Company,

Inc., 1978.

Williams, Allan M., The European Community – The Contradictions of Integration, First

Edition. Cambridge, MA, Basil Blackwell, Inc., 1991.

 

FOOTNOTES

[1] Williams, Allan M., The European Community – The Contradictions of Integration , page 20.

[2] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe , page 20.

* Note:  The success Monnet brought to his father’s business established him as a very wealthy man, allowing him to campaign for his European integration theory with no financial or political concerns or agendas to detract from his devotion to his ideas and vision for Europe.

[3] Keylor, William R., The Twentieth Century World, an International History , page 179.

** Note:  The United States had its own motives for distributing funds to western Europe; the continent was being divided by the iron curtain of Communism, and U.S. policy-makers held the opinion that extreme poverty in democratic countries led to disillusionment with western doctrines and these populations would hence turn to communism.  Communism boasts equality for all; all would be guaranteed work and food.  People would turn to communism where they felt capitalism failed.  Therefore, the United States felt that aid to these countries would decrease the likelihood of these countries resorting to Communism, and distributed large aid packages in the form of, for one, the Marshall Plan.  (William R. Keylor, Boston University, HI 350 Lecture, “The Political Partition of Europe (1945-1949)”, January 17, 2002).

[5] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, pages 9-70.

[6] Keylor, William R., The Twentieth Century World, an International History , page 286.

[7] Monnet, Jean, Memoirs, pages 399-402.

[8] Dublin European Institute, The Jean Monnet Project at University College Dublin (Online).

[9] Keylor, William R., The Twentieth Century World, an International History , page 289.

[10] Duchene, Francois, Jean Monnet, The First Statesman of Interdependence , pages 9-13.

[11] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, pages 44-46.

[12] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, page 46.

[13] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe , pages 97-100.

[14] Keylor, William R., Boston University, HI 350 Lectures, January 24, 2002.

*** Note:  The original idea was to discourage German belligerence, however, with the start of the Cold War, the ECSC was another institution that countered communism. (the European economy dyker 73)

[15] Keylor, William R., The Twentieth Century World, an International History , page 288.

[16] Dyker, David, The European Economy , page 52.

[17] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, pages 111-112.

[18] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, page 113.

[19] Keylor, William R., Boston University, HI 350 Lectures, January 29, 2002.

[20] Keylor, William R., Boston University, HI 350 Lectures, January 24, 2002.

[21] Keylor, William R., The Twentieth Century World, an International History, page 288.

[22] Williams, Allan M., The European Community – The Contradictions of Integration , page 23.

[23] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, page 52.

[24] Kyn, Oldrich, Boston University, EC 395 Lecture, January 16, 2002.

[25] Gregory, Paul R. & Stuart, Robert C, Comparative Economic Systems, page 21.

[26] Gregory, Paul R. & Stuart, Robert C, Comparative Economic Systems, pages 280-282.

[27] Bromberger, Merry and Serge, Jean Monnet and the United States of Europe, page 19.

[28] European Communities (The European Union Online).

              

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