Juncker Comes to Praise Not Bury Britain’s EU Membership

Jean-Claude Juncker wants to dismantle barriers to business in the European Union market, is a longstanding fan of the bloc’s expansion to the east, and opposes a centralized European superstate.

All are classic British positions, and Juncker, a former prime minister of Luxembourg who faces a confirmation vote tomorrow as the next European Commission president, also favors making concessions to Britain to keep it in the EU. That didn’t stop U.K. Prime Minister David Cameron from trying to derail his appointment to the top EU post and Britain’s tabloid Sun newspaper branding him “the most dangerous man in Europe.”

A look at 59-year-old Juncker’s record suggests otherwise. Through more than 30 years in government, almost 19 of them as prime minister, punching above tiny Luxembourg’s weight with his role in creating the euro in the 1990s and defending it in the debt crisis, a picture emerges of the consummate political fixer, not the euro-dreamer he is made out to be.

“Juncker is not the type of federalist that was pictured in some media,” said Adelina Marini, founder of www.euinside.eu, a EU analysis website based in Zagreb, Croatia. “His experience in dealing with the euro-zone crisis also suggests he is a realist, he’s going to take into account the various interests.”

With 550,000 inhabitants squeezed between Germany and France, Luxembourg occupies a hinge position. As one of the EU’s six original states in the 1950s, it has been a player in shaping today’s Europe, including a starring role for Pierre Werner, one of Juncker’s predecessors, in the first abortive project for a common currency in the 1970s.

Steelworker’s Son

Always keen to emphasize his working-class street cred as the son of a steelworker, Juncker inherited the national trait for accommodation, the three languages that go with it -- French, German and Luxembourgish, later adding English -- plus a politician’s instinct for shifting with the prevailing winds, especially if they blow from Berlin or Paris.

Juncker was the go-between in 1996, when Germany demanded automatic sanctions on euro budget-deficit violators and France resisted; in 2004 and 2005, when a more spendthrift German government slinked out of the rules; and during the debt crisis starting in 2010, when another German government, headed by Angela Merkel, had them retightened.

Each time, Juncker sold the outcome as a victory for common sense. The softening of the anti-deficit pact in 2005? The point was to impart “an economic logic that it simply lacked in its original form,” he said at the time. Once the crisis struck, the logic changed: suddenly the rules needed more “teeth,” he said.

Past Gaffes

To be sure, Juncker isn’t the first politician to change his mind, or to commit a gaffe or two. As head of the committee of euro finance ministers, he issued a non-denial denial of a crisis conclave at a secluded Luxembourg chateau and blurted out the possibility of debt relief for Greece before it became acceptable to the Germans.

As commission president, Juncker’s room for maneuver will be limited. The ultimate power rests with the 28 national governments, now airing conflicting calls for “reform” as the economy lumbers out of the financial crisis and the rise of anti-establishment parties stymies Europe-wide initiatives.

Ana Palacio, a former Spanish foreign minister, doubts that Juncker will preside over an activist era. “Europe doesn’t have a real narrative,” she said. “To reform what, how? The moment you clean in one corner, someone will tell you to clean in a different corner.”

Accommodating Britain

Britain’s corner already looks like it will be among the messiest during Juncker’s five-year term. Cameron has pledged that if re-elected in 2015, he will give U.K. voters the option of quitting the EU in a referendum by 2017. Cameron declared Juncker the “wrong person” and battled in vain to block his appointment, even though Juncker was the only candidate who offered to rework Britain’s EU membership terms.

Juncker needs “to accommodate Britain to stay in the EU, while at the same time preparing the ground for a push ahead for the euro zone,” said Roberto Castaldi, co-founder of the International Centre for European and Global Governance in Pisa, Italy.

Juncker’s emotional connection to Europe is rare among modern politicians. Although born almost a decade after World War II, he sees the EU primarily as a peace-insurance policy, echoing the wartime generation and his political godfather, Helmut Kohl, who embedded the united Germany in an enlarged EU.

“He is a pupil of Helmut Kohl: he lives Europe with his heart,” said Claude Turmes, who represents Luxembourg in the European Parliament.

EU Expansion

Like Kohl, Juncker regarded the EU’s expansion in 2004 to eastern countries once trapped behind the Iron Curtain as a moral imperative. He was in tune with the British government of the day, even if the U.K. was more motivated by the economic advantages and the prospects that a larger bloc would defy central management from Brussels.

In EU constitutional negotiations starting with the Maastricht treaty summit in 1991, Juncker was never a centralizer. While former Belgian Prime Minister Guy Verhofstadt, one of the defeated candidates for commission president, wrote books extolling a “United States of Europe” with powers flowing to Brussels, Juncker’s prism is a national one.

“The European nation doesn’t exist,” he told an audience of Luxembourgers and Belgians who were inclined to think otherwise in 2001. Nations are not “provisional inventions of history.” And to a German audience in 2006: “I have no desire whatsoever to be a citizen of the United States of Europe.”

Federalist Thinking

Views like that don’t sit well with the European Parliament, a traditional hotbed of federalist thinking. Juncker never embraced the notion of European parliamentary supremacy, instead preaching a stronger role for national parliaments in EU decision-making, as happened during the debt crisis.

In what looks like heresy today, Juncker in 2000 said EU leaders collectively should have the power to dissolve the European Parliament, as is the case in some national systems. That idea never went anywhere.

Juncker now confronts a parliament that is less EU-friendly than before, after protest parties upped their representation to about 30 percent in May elections from 20 percent. He sparred and schmoozed his way through confirmation hearings last week, emphasizing pro-growth policies to the socialists and sound budgets to the conservatives.

Asked by a Swedish anti-EU deputy what he will do to placate euroskeptics, Juncker said: “I’ll do my best to see to it that there are fewer of you next time around.”

Before it's here, it's on the Bloomberg Terminal.