Wednesday, February 16, 2011

Realism or Institutionalism? Wrong Question

. Wednesday, February 16, 2011

So Henry Farrell got to this Stephen Walt piece before I could, and I agree with everything Farrell says. Especially this:

If (as Walt seems sometimes to be suggesting in this post), realism is nothing more than the claim that national interests predominate in explaining international outcomes, then realism is theoretically very nearly vacuous. Moreover, the candidate ‘rival paradigm’ explanations are, under this broad definition, actually realist too. They have quite as much to say about state interests, and perhaps more to say about power relations than Walt does. If Walt has an actual realist explanation of what is driving European states apart – one that would presumably be rooted in the security dilemma or some other systemic phenomenon – it would be very nice to know what it is. He certainly doesn’t tell us about it in the post as it stands.

Indeed, an institutionalism without interests makes no sense. Why else create institutions?

But Farrell missed one strand I'd like to emphasize. If Walt really wants to use the EU as a test of rival paradigms, he's going to lose. In fact, he's already lost. Realists (generally) claim that institutions are merely extensions of state power, and thus do not constrain the behavior of (powerful) states in any significant way.* And yet it's clear that membership in the EU has caused states to behave differently than they otherwise would. Rather than devalue and/or default, Greece and Ireland are engaged in austerity. Rather than let them devalue and/or default, Germany and France are bailing them out in the short-run, and are considering a range of Euro-wide fiscal policies that would bring policy convergence on a number of issues. None of these actions would be taken if the EU didn't exist. So the institution is something more than an extension of Franco-German power, even if Franco-German power is reflected in the institution. Saying that the EU will not do anything that France and Germany don't want it to do is not the same as saying that France and Germany would behave the same way if the EU did not exist.

Note that at least some of the old-school institutionalists that Walt seems to be referring to wouldn't like an argument like the previous sentence. But I don't know of anybody who still hews to a that functionalist of a line. Certainly not Keohane. So I'm not sure who Walt sees as his foil. As Farrell notes, he references Andrew Moravcsik and Barry Eichengreen but neither is really an institutionalist the way Walt seems to be describing.

(Moravcsik's book on the EU has "State Power" in the title, and in this paper and this paper Moravcsik attacks neofunctionalist approaches to the EU. Moravcsik is definitely a liberal, but not the sort Walt seems to be referring to.)

But all of this ignores the real problem, which is that neither dogmatic realism nor dogmatic institutionalism helps us understand what's going on. Of course power and national interests are important, and of course the institution is important too. The maintenance of the institution itself is of national interest to member states. Neither is it a question of whether deeper integration will occur; it already has occurred. Never before had anything like the EFSF -- fiscal transfers from some EU states to others -- existed. Never before had the ECB intervened in bond auctions. The question now is whether this new integration becomes legally codified, or whether the cost of it becomes unbearable, and it is abandoned. Neither realism nor institutionalism helps us understand which is more likely.

So it's not just that Walt has the wrong answer, although he does, it's also that he's asking the wrong question.

*It's probably better to say that realists generally think of institutions as intervening variables, but not important independent variables. Like much else in realism this begs a question -- why would rational states waste time creating institutions if that's all the were -- but there it is.


Morgenthau said...

Walt's post deserves to be taken apart. But it doesn't mean that realism's explanatory power deserves the same treatment.

I would like to make three points.

First, a good realist would first look at the security situation in Europe. It can safely be argued that never before has Europe been safer from external and internal threats. Indeed, European countries devote much of their attention and energy to bring forward the European project, because they don't have worry about serious security issues. Security in Europe is provided by a non-European country, and that is the United States. This fundamental pillar of the post-war era wasn't affected by the end of the Cold War. Just look at what happened in the Balkans in the 1990s, as the European countries couldn't get their house in order and Washington had to intervene and clean up the mess.

So long as the United States remains the globally pre-eminent power, no serious security issue will arise on the European continent. US military supremacy and NATO will continue to keep the Americans in, the Russians out, and the Germans down. Also, the job of dealing with the growing Chinese power falls mainly on Washington. Because there is no serious security threat for and within Europe, the issue of "relative gains" is largely irrelevant here. No European country has to worry about Germany attempting to translate its growing economic clout into military strength.

Any serious discussion about the EU should start by pointing out this crucial yet largely underrated fact about security. If Europeans can afford to worry about economics, it's because they don't have to worry about security.

Morgenthau said...

Second, the realist school says what states should do if they want to guarantee their survival. Since there is no central ruling body above them, states have to rely on their own resources to achieve security. The concept of "national interest" is here used by realists in terms of a "reference point", from which states shouldn't deviate too far if they don't want to get hurt. That's the core realist insight. States are well-advised to keep a healthy balance between means and ends.

You argue that "it's clear that membership in the EU has caused states to behave differently than they otherwise would." Realism suggests how states SHOULD behave, not how they actually behave. If states don't engage in reckless behavior, they won't squander precious resources and will be able to gain security and survival. States ignore their national interests at their own peril.

With regard to the current behavior of EU countries, the key element will be the outcome. Only time will tell whether the EU countries are pursuing their national interests according to realist tenets or engaging in reckless and costly behavior. Now it's too early to evaluate the costs and benefits of recent actions of EU countries.

Third, the realist school likes most EU institutions, for they confirm one of realism's core assumption. International institutions are created and maintained by the powerful members. EU institutions are no exception. Indeed, the most influential EU institutions largely reflect the interests of one country, and that is Germany, the most powerful country in Europe.

It's pretty obvious that most EU institutions were and are set up in accordance with German interests. If someone has a doubt about this crucial fact, please take a look at the ECB, the Maastricht Treaty, the Stability Pact, or even the mooted "Competitiveness Pact". If the Germans waste time creating these institutions, it's because they think these institutions will help pursue German interests.
Realists would only warn about the potential costs. But they would agree with German actions if "with institutions" is more safe and cost-effective" than "without institutions." Once again, it's too early to have a serious discussion about the costs of the recent policy initiatives in Europe. But my general impression is that the Europeans, despite some colossal blunders, are not engaging in reckless behavior.

In sum, even though realism doesn't account for everything that is happening in Europe today, its explanatory power remains impressive.

Kindred Winecoff said...

Morgenthau -

Thanks for commenting. I have no disagreement at all with your first comment.

Regarding your second, realism is more (or used to be more) than a manual for state survival. Realists do claim that this is how states actually behave, not just how they should behave. They have to in order for the playbook to work. Realism only makes sense if it accurately describes the world. If it doesn't, then perhaps it's advice for how to survive is wrong. (This is why you sometimes hear realists defend their views with something like "This is the world we live in, not the world we wished we lived in".)

"Only time will tell whether the EU countries are pursuing their national interests according to realist tenets or engaging in reckless and costly behavior."

If that's the case then realism is spectacularly un-useful at explaining the world.

I agree (and have written on this blog a lot about) your view of Germany's role in the EU. Where I split from (some) realists is when they say that because institutions just reflect the underlying power balance they don't really do anything. I.e, Europe would be peacefully dominated by Germany whether the EU existed or not. Germany is not constrained by the EU, and other states would be constrained by Germany even if there was no EU. I don't think that's the case at all, and I think the existence of the EU has European politics is many very fundamental ways.

John Quiggin said...

"Security in Europe is provided by a non-European country, and that is the United States."

Security against whom? The Red Army? Of the top 6 defense spenders in the world, three are in the EU. In aggregate the EU countries spend four or five times as much as their only conceivable adversary, the decrepit Russian Federation. (I leave aside, as is normal, the fact that Russia and two EU countries can destroy the entire continent any time they feel like it).

Kindred Winecoff said...

John, Morgenthau referred to the Balkans in the 1990s. He could also have said Georgia and Kosovo now.

The bigger point is that the US security guarantee for NATO and other allies has prevented the European security rivalries of the past. That commitment may be less necessary now than it used to be, but who knows?

John Quiggin said...

Georgia? As I recall, they just lost a war with Russia, in which the US took no part. (Georgia is, by the way, about the maximum size for a European country Russia could take on militarily with any confidence about the outcome.)

And the claim that it was the US guarantee, rather than the general pacific trend exemplified and accelerated by the EU, that prevented European security rivalries was the basis for predictions that those rivalries would re-emerge after 1989. As you may recall, they didn't.

John Quiggin said...

As regards the Balkans, the crucial issue was not a security guarantee but the greater willingness of the US to take military action. That willingness was vindicated in this case, but led on to the catastrophe in Iraq.

Morgenthau said...

@ John

I don’t think you really appreciate the role of the US in providing security in Europe.

As Kindred said it, it’s about taming and preventing past rivalries among European great powers. I live in Europe, so I know what I’m talking about. There are not many European countries that have not been dealt a body blow by Germany during the last century. Even France, Great Britain and Russia had to bear the brunt of German power. True, Germany has changed a lot during the last six decades. Yet, Europeans feel safe mainly because NATO still exists and because there are still more than 100’000 US troops on German soil. It’s like keeping an umbrella for a rainy day. Our principle is “just in case”.

You talk about “the general pacific trend exemplified and accelerated by the EU”. But we Europeans reply that it’s plain nonsense. The two world wars, the most devastating conflicts in human history, were actually European civil wars. And they were, essentially, about “the German problem”, that is, modern Germany’s place in Europe since its birth in 1871. The European project was set in motion mainly as an attempt to tame the German Gulliver. True, it was the Franco-German political rapprochement that provided the basis on which the European integration was built. This rapprochement, however, was made feasible only by the implicit guarantee that Uncle Sam would intervene if Germany were to wreak havoc again. The end of the Cold War did not transform these structural realities.

To really appreciate the US role, consider the following scenario. The US becomes so fiscally bankrupt that it is forced to make drastic cuts in defense spending and to withdraw its security commitments in Europe and East Asia. The Europeans are told in unambiguous and credible language that they will have to keep their house in order by themselves. With the US security guarantee removed, the game of security dilemmas is again on in Europe. What do you think will happen in Europe? Maybe nothing ugly will happen. But it takes a huge leap of faith to make that assumption, one that no European will feel comfortable about.

Morgenthau said...

@ Kindred

You raised some very good points. I agree with most of them, but I still have doubts about some others.

I think it’s useful to distinguish the levels of analysis when talking about realism, in particular the system-level and the state-level. According to “structural” realists (like Waltz and Mearsheimer), it’s the international system that influences and shapes state behavior. So the states respond to structural forces. And the latter refer to the absence of a higher ruling body (“anarchy”) and the unequal distribution of material capabilities among states. So when realists talk about how states actually behave, they refer to the fact that structural constraints force all states to attain security and pursue their national interests. Regardless of their distinctive political systems or cultural attributes, all states are expected to behave similarly because of structural imperatives.

At the state level, instead, (classical and neoclassical) realists focus on how states should behave in the short run. It’s like having Keynes say “In the long run, we are all dead”. So, in the short run, realists’ advice is to pursue “the national interest”, that is, to make sure that state survival is guaranteed, a reasonable balance between resources and foreign policy goals is kept, and reckless and costly behavior is avoided. This is what foreign policy is all about. The inherent problem is that neither mathematical solutions nor mechanical ways exist for conducting foreign policy. That’s why it is called statecraft.

With regard to the EU, structural realists would argue that, in the long run, EU countries will be forced by structural constraints to pursue their national interests. Structural realists don’t rule out the possibility that states will make mistakes and blunders, but they assume that structural forces will shape and shove state behavior. That’s the system-level perspective. Its main weakness is only that it cannot predict “when” states will respond to the structural incentives.

From a state-level perspective, instead, realists will advice state leaders not to make costly policies and strategies. It’s mainly about considering the policy alternatives, evaluating their respective costs and benefits, and choosing the comparatively cost-effective actions. If states engage in reckless behavior and costly moral crusades, they will get hurt.

If there are German policymakers with a realist instinct, they should answer the questions above. But, as I warned in my previous post, it’s not easy at all to include, or even to know, the full costs and risks of the many policy alternatives. Ultimately, It’s like making an educating guess and be ready to adapt as soon as the situation changes.

Just to show how difficult it is to compare the costs of policy alternatives: What is the real cost of letting Greece and Ireland default? What is the cost of the alternative action of keeping them afloat? What is the real cost of forcing the ECB to buy junk sovereign debt? What is the actual cost of the inherent moral hazard? If Greece and Ireland are allowed to restructure their debt, will Spain, Italy, Portugal and others rush to do the same? Is the European banking system adequately capitalized to absorb these massive sovereign defaults? What does it really cost to adopt E-bonds? Will Germany have to pay higher yields?

As this suggests, it’s difficult, and perhaps too early, to really know whether EU countries are pursuing their national interests. But realism helps asking some important questions and offers some important answers.

Kindred Winecoff said...

@ John:

"And the claim that it was the US guarantee, rather than the general pacific trend exemplified and accelerated by the EU, that prevented European security rivalries was the basis for predictions that those rivalries would re-emerge after 1989. As you may recall, they didn't."

No, the claim was that those rivalries would re-emerge *if* the US reacted to the fall of the USSR by cutting back on its presence in Europe. That hasn't happened, just like NATO hasn't gone away.

You might be right that the EU is now sufficiently integrated that the old concerns can be forgotten. End of History and all that. But I'm not so sure. The Concert of Europe was mostly peaceful for 100 years. And recent events have made it clear that nationalism is still quite prevalent. I'm not saying that if the US pulled out on Tuesday there would be war on Wednesday, but I think it would begin a gradual process that would fundamentally change European relations over a period of years/decades.

@ Morgenthau - Fair enough. But then you're defining realism down to the point where it's mostly harmless. I was talking about Waltz and Mearsheimer (and Walt) brand of (neo)realism, which is what "realism" means to most people today.

Realism or Institutionalism? Wrong Question

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