French rejection of top American economist blow to liberal Europe

Nobody does “No” better than the French. Charles De Gaulle said “Non” twice to Britain’s bid to join the European Economic Community; Jacques Chirac said “Non” to the Iraq war; and Emmanuel Macron this week gave a thumbs down to Fiona Scott Morton, the American Yale academic selected for the post of top economist at the EU’s powerful competition directorate in Brussels.

L’affaire Scott Morton may seem trivial in comparison to the (still unresolved) debate over Britain’s place in Europe or armed conflict in the Middle East, but the French veto of the first foreigner to take up the post says an awful lot about the European Union’s current paranoia about America’s influence and power, according to Politico. 

As Macron has pushed a vision of Europe that stands up to the US, resisting pressure to become “America’s followers,” as he put it in April, such thinking has strengthened in Brussels.

The Scott Morton fiasco brings back memories of a lunch in Brussels exactly 30 years ago when some officials suspected the U.S. was engaged in an Anglo-Saxon plot to sabotage their plans for economic and monetary union. “Remember James Jesus Angleton,” said a stone-faced Belgian bureaucrat, invoking the name of the legendary, obsessive CIA counterintelligence officer at the height of the Cold War.

Professor Scott Morton was selected as the best candidate in open competition. She enjoyed the backing of Margrethe Vestager, the Danish EU competition commissioner often described as the most powerful antitrust regulator in the world. She also had support from Ursula von der Leyen, German president of the European Commission, whose leadership during the Ukraine war and the COVID pandemic has won widespread praise on both sides of the Atlantic.

All this counted for naught. Despite her distinguished academic pedigree, Scott Morton, a former Obama administration antitrust official, worked for Apple, Amazon and Microsoft in competition cases in the U.S. The notion her background somehow disqualified her for the job shows George W. Bush was wrong when he complained the French had no word for “entrepreneur.” Today’s problem is that Paris has no understanding of the term “poacher turned gamekeeper.”

As Carl Bildt, former Swedish prime minister, tweeted: “Regrettable that narrow-minded opposition in some EU countries has led to this. She was reportedly the most competent candidate, and a knowledge of the US and its antitrust policies should certainly not have been a disadvantage.”

Now, President Macron’s opposition to the appointment has attracted a good deal of support in the Commission, in the European Parliament and among European trade unions. Cristiano Sebastiani, head of Renouveau & Démocratie, a trade union representing EU employees, said senior EU officials should “be invested, believe and contribute towards the European project. The very logic of our statute is that an EU official can never go back to being an ordinary citizen.”

France’s veto of Professor Scott Morton is de facto a veto of Vestager, who was almost untouchable during her first term as competition commissioner between 2014-19. She won kudos for investigating, fining and bringing lawsuits against major multinationals including Google, Apple, Amazon, Facebook, Qualcomm, and Gazprom. More controversially, at least in Paris and Berlin, she vetoed the planned merger between Alstom and Siemens, two industrial giants intent on creating a European champion.

Vestager’s second term has been a different story. She has suffered reverses in the courts which overturned punitive fines against Apple and Qualcomm. Then, although she ranks as a vice-president of the Commission, Vestager found herself challenged by a nominal underling in the shape of Thierry Breton, a former top French industrialist put in charge of the EU’s internal market.  

Both have battled over the policing of the EU’s Digital Markets Act and over policy on artificial intelligence, a proxy fight for influence overall in Brussels.

Breton favours the so-called AI Pact, an effort to bring forward parts of the EU’s draft Artificial Intelligence Act. This would ban some AI cases, curb “high-risk” applications, and impose checks on how Google, Microsoft and others develop the emerging technology. 

By contrast, Vestager favours a voluntary code of conduct focused on generative AI such as ChatGPT. This could be developed at a global level, in partnership with the US, rather than waiting for the two years it will take to secure legislative passage of Breton’s AI Pact. 

So what’s the solution? If Europe is to have any chance of prevailing, so the argument goes, member states must take a far harder-nosed attitude to competition policy. This leads in turn to the creation of national or pan-European champions at the expense of crackdowns on subsidies and other anti-competitive behaviour. In short, the very liberal policies designed to protect the single market’s level playing field and embodied by the fighting Viking.

For those who occasionally wonder how power has shifted inside the EU since Brexit took the UK out of the equation, it is proof indeed that “liberal Europe” is on a losing streak.

Goodbye, Little Britain; hello, little Europe.