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«EUI Working Papers RSCAS 2012/23 ROBERT SCHUMAN CENTRE FOR ADVANCED STUDIES Global Governance Programme-18 MULTILEVEL GOVERNANCE OF INTERDEPENDENT ...»

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This Introduction summarizes the main conclusions of the conference papers and discussions following the four sections of the conference report. Section I explores Multilevel Governance of Interdependent Public Goods from the perspective of policy-approaches by governments and leading practitioners. Section II analyses Collective Action Problems Impeding Collective Supply of Interdependent Public Goods from the perspective of economic, political and legal theories and analyses. Section III includes Case Studies on Multilevel Governance of ‘Interface Problems’ of the International Trading, Environmental and Development Systems. Section IV concludes with analysing the Constitutional and Legal Problems of Multilevel Governance of Citizen-driven International Public Goods. In order to coordinate the papers and focus the discussions on policy issues, participants had been invited to respond to a number of policy questions. In welcoming and thanking the key-note speaker – WTO Director-General Pascal Lamy –, Prof. Petersmann recalled the genius loci of

Florence:

Since the Middle Ages, the three Florentine ‘city republics’ and their ‘Platonic Academy’ – and also today’s European University Institute established as an international organization at Florence – offer innovative examples for multilevel governance of public goods challenging power politics.

The intellectual revolution of the ‘Florentine Renaissance’ was based not only on a return to Platonism and Aristotelianism but also to humanism (as illustrated by Pico della Mirandola’s Oration on the Dignity of Man founded on individual freedom) and to republicanism. The political history of Florence offers many examples for the dangers of struggles for governance reforms, as illustrated by the torture of Machiavelli following the overthrow of the second republic of Florence The two leading research publications on global public goods published by the UN Development Program - i.e. Kaul et al. (1999, 2003) - did not include legal studies. The book edited by Maskus and Reichman (2005) focussed on knowledge as ‘perhaps the quintessential public good’ (p.47) and on its decentralized supply by means of intellectual property rights excluding ‘free-riders’ and setting incentives for innovation.

Introduction and Overview

(1494-1512) or by the murder of Pico della Mirandola following his controversial proposals possibly in the same Badia monastery hosting the EUI today - on reforming the multilevel governance of the Roman church. The EUI’s Global Governance Program - as one of Europe’s research centres on reforms of multilevel governance – is a unique conference venue for exploring governance of public goods and the related need for a new ‘public reason’. Petersmann thanked Pascal Lamy for having finally accepted the repeated invitations to deliver a lecture in the Badia monastery of the EUI and concluded by mentioning a recent joke among diplomats at Geneva, which explained why discussing the divine challenges of multilevel governance in the splendid

Renaissance refectorium of the Badia monastery was an appropriate venue:

US President Obama has an appointment with God and asks him: When will the US deficit be reduced? Not in your lifetime, answers God. And Obama begins crying. German Chancellor Merkel meets God and asks him: When will the Eurozone be out of trouble? Not in your lifetime, replies God. And Merkel begins to cry. China’s President Hu Jintao sees God and asks: When will the province of Taiwan be reunited with the communist fatherland? Not in your lifetime, God answers again. And Hu begins to weep. Finally, Pascal Lamy meets God and asks: When will the Doha Round of trade negotiations be concluded? This time, God begins to cry.

I. Multilevel Governance of Interdependent Public Goods: Policy Approaches SECTION I begins with a presentation by WTO Director-General, and former EU Commissioner for Trade Policy, Pascal Lamy on Global Governance, from Theory to Practice. Lamy emphasizes ‘the gap between theory and practice’ in analysing global governance: The prevailing ‘Westphalian conception’ of international governance postulates that ‘as States are coherent and legitimate, global governance is necessarily coherent and legitimate as well’. In international practice, however, ‘States are often incoherent’; also ‘member-driven international organizations’ may lack legitimacy in the eyes of citizens. The ‘legal bridges’ built between international organizations in order to remedy the ‘coherence gap’ are often weak. As ‘theory and practice do not match’, Lamy calls for ‘pragmatic solutions … to be found now to enhance global governance and better address the problems that our world is facing’, notably by providing better leadership, more legitimacy, efficient results for the benefit of people at a reasonable cost, and more policy coherence. At the national level, leadership, legitimacy and efficiency are within the same hands of one ‘government’; at the international level, however, the three elements are much more complex. European integration has evolved into a unique multilevel governance model based on leadership by the independent European Commission and legitimacy promoted by democratic and judicial EU institutions protecting efficient European achievements like the common market. But the declining participation in elections to the European Parliament and the rising euroscepticism in public opinion reveal the limits of legitimacy even of the EU and the need for pragmatic governance reforms. Lamy supports the emerging ‘triangle of coherence’ based on (1) the G20 providing political leadership and policy direction; (2) the UN providing a framework for global legitimacy through accountability; and (3) member-driven international organizations providing expertise and specialized regulation, whose mutual coherence is being promoted by the increasing ‘bridges’ linking the G20 to the UN and to specialized organizations like the WTO as well as through the annual meetings of the ‘Chief Executive Board’ of the UN. Lamy endorses the attempts at revitalizing the ECOSOC in order to enhance UN system-wide coherence, the increasing number of joint initiatives by the WTO and UN agencies, as well as the readjustment of voting rights in the Bretton Woods institutions. In order to reinforce the ‘secondary legitimacy’ of Westphalian organizations deriving from state democracy by ‘primary legitimacy’ deriving from direct participation of citizens, global governance must respond to the democratic criticism of ‘toodistant, non-accountable and non-directly challengeable decision-making at the international level’.





Another lesson from European experience is the need for basing successful integration on common objectives, shared values and an adequate institutional machinery. According to Lamy, the UN human rights values and regional integration as ‘the essential intermediate step between the national and the global governance level’ need to be strengthened before stronger local and ‘community support’ for Ernst-Ulrich Petersmann multilevel governance institutions may emerge. More ‘primary legitimacy’ of global governance based on support from civil society and ‘global citizens’ - identifying with a ‘global community’ and the necessary building of a new ‘polity’ - requires ‘localizing global problems’ and remains ‘the main political challenge we are facing’.

Differences between global and regional governance of public goods In the second contribution to Section I, Josep Borrell – President of the European University Institute and former member and President of the European Parliament – analyses The EU and the European Parliament in International Trade and Climate Change Negotiations. Borrell agrees with the premise that the transformation of ever more national public goods (like common markets, protection of the environment) into international public goods makes multilevel governance of interdependent public goods the central policy challenge in the 21st century, necessitating multidisciplinary analyses and reform proposals. He analyzes the roles of the EU and of its European Parliament in international trade and climate change negotiations in the light of the Lisbon Treaty’s enlargement of the EU competences for common commercial, investment and environmental policies and the co-decision powers of the European Parliament. The more local, national and regional supply of public goods becomes dependent on supplementary worldwide cooperation (e.g. for prevention of climate change), the more complex become governance decisions on which goods should be supplied privately or publicly, and how local, national, regional and global governance institutions can be coordinated so that all citizens benefit. As the Lisbon Treaty commits the EU to ‘promote an international system based on stronger multilateral cooperation and good global governance’ (TEU, 2009, Article 21), the EU often portrays itself as ‘the multilateral player par excellence’ for global governance. Yet, as ‘national self-interest and a lack of political will often prevail’, the EU’s record on these ambitions remains ambiguous. According to Borrell, the EU’s experiences with overcoming such ‘hurdles in the cooperation between sovereign states on shared challenges’ offer also lessons for overcoming collective action problems in global governance, for instance by designing incentives for collective cooperation. Thus, the EU membership in the WTO offers an example for other regional economic organizations of how national, regional and worldwide governance of interdependent public goods (e.g. national, regional and global common markets) can be legally and institutionally coordinated.

The European Parliament’s co-decision power to approve or reject all international trade and investment agreements of the EU entails additional levels of ‘politicization’ of decision-making and incentives for rent-seeking that may render protection of international public goods more difficult;

hence, ‘Parliament has to prove that its empowerment and enhanced democratic legitimacy do not lead to a deterioration in policy outcomes’. The leading role of the EU in adopting/ratifying the 1997/2005 Kyoto Protocol and enabling the 2011 ‘Durban agreement’ on a new climate prevention convention offers another example of EU leadership in providing global public goods and setting decentralized incentives (e.g. through the European carbon emission trading systems and its inclusion of foreign airlines flying to and from the EU) for collective supply of international public goods. The EU’s leadership role in the WTO as well as in climate change prevention negotiations illustrates the potential contribution of regional organizations to reducing the ‘capabilities-expectation gap’ characterizing global governance; yet, even though the EU model may be used for looking for necessary elements of effective global governance, the EU’s common trade and environmental policies also illustrate the manifold ‘collective action problems’ impeding ‘leading by example’ for multilevel governance of interdependent, international public goods.

The conference discussions focused on the diverse national, regional and worldwide governance responses to the transformation of ever more national public goods (like open markets, protection of the environment, human rights) into international public goods. In addition to the ‘coherence gap’ and ‘legitimacy gap’ discussed by Lamy, the 'sovereign equality of states’ also entailed ‘jurisdiction gaps’, ‘governance gaps’, ‘incentive gaps’, ‘participation gaps’ and transnational ‘rule of law gaps’ impeding

Introduction and Overview

collective supply of global public goods (for a discussion of these ‘gaps’, see Kaul et al., 1999, 450 ff;

Petersmann, 2011, 23, 33 ff). The EU model of reducing such 'gaps' by regional 'communitarization' and 'constitutionalization' of economic and environmental policy powers and governance institutions had so far not been followed by other regional economic groupings outside Europe. Also the example of EU membership in the WTO - facilitating transformation of national and regional into global public goods, as illustrated by the EU’s leadership role in the Doha Round negotiations - had so far not been followed by other regional trade organizations. The co-decision powers of the directly elected European Parliament went far beyond the more limited powers of parliamentary bodies in other multilateral treaties. But this additional layer of parliamentary 'input legitimacy' in multilevel European governance has also entailed an increase in 'politicization' of decision-making, which risks undermining the 'output legitimacy' of the EU's co-decision-making by non-transparent interest group politics. The leading role of the EU in adopting/ratifying the 1997/2005 Kyoto Protocol and enabling the 2011 ‘Durban agreement’ on a new climate prevention convention were widely seen as successful examples of EU leadership in promoting global public goods and setting decentralized incentives (e.g.

through the European carbon emission trading system and its inclusion of foreign airlines flying to and from the EU) for their collective supply.



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