After years of heating up, the EU’s values crisis is close to boiling point. Defiance of core EU principles by the governments in Warsaw and Budapest is turning into a political crisis. The European Commission has taken legal action against both governments for violating specific EU laws and is threatening to go further on Poland. The European Parliament supports this course and is preparing further action against Hungary. But the Hungarian and Polish governments will feel the heat only if political leaders of the EU’s other member states get actively involved.

The EU’s role in protecting values in its members’ domestic affairs has evolved significantly over the last two decades. Initially, European integration was primarily about economic cooperation. The creation of a community of law was fundamental to provide a high degree of certainty and stability to citizens and businesses, and it remains the EU’s great comparative advantage over rising powers and other investment destinations.

The union’s legal framework proved remarkably resilient during recent crises over the euro and migration. But now its foundations are under attack from the inside. National political leaders must join the EU institutions in doing more to defend the union’s core values.

A High Threshold for Action

Until the end of the Cold War, respect for the rule of law, democracy, and fundamental rights was taken for granted, and members were expected to keep their own houses in order. EU values were first mentioned in the 1992 Treaty on European Union, and the relevant commitments were strengthened in subsequent revisions. The most detailed elaboration is Article 2 of the current treaty, which defines EU values as “respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities . . . in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail.”

However, while EU countries prominently featured these values in their external policies and made them conditions for would-be future members, governments remained reluctant to give the union a role in supervising their own practices. The legal framework on values is minimalist in comparison with the elaborate body of law on economic integration. The EU’s treaties even commit the union to “respect the national identities of the member states, inherent in their fundamental structures, political and institutional, inclusive of regional and local self-government.”

The prospect of taking in post-Communist countries prompted the introduction of a safeguard in 1999 to prevent reversion to authoritarian rule in unconsolidated democracies. It later became Article 7 of the current treaty, with three stages: Under paragraph 1, four-fifths of the EU’s members can determine in the Council of Ministers that there is a “clear risk of a serious breach by a Member State of the values referred to in Article 2,” based on a reasoned proposal by one-third of the member states, the parliament, or the commission. Under paragraph 2, the European Council (the heads of state and government), after hearing from the offending state, can decide by unanimity among all other members that there is a “serious and persistent breach” of values. Paragraph 3 then allows the Council of Ministers to suspend certain of that country’s rights, including its government’s voting rights.

The threshold for activating Article 7(2) was set very high to make sure that it could apply only to extreme cases, such as a military coup. Despite disrespect of values in several countries over the years, the EU’s governments have so far failed to take concerted action for four major reasons.

The Sovereignty Reflex

National governments’ desire to protect themselves from outside interference remains a major constraint on the supranational oversight of values. Supporters of the original federalist vision of European integration, such as the Benelux countries, were more open, whereas the more sovereigntist France, Denmark, and the UK insisted on keeping the EU out of national governance. When new members from Central and Eastern Europe joined in 2004 and 2007, they were not keen on surrendering their recently regained sovereignty to the EU and saw themselves as potential targets of Article 7.

As a result, when the EU Charter of Fundamental Rights gained legal force under the Lisbon Treaty, it was hedged with restrictions on judicial mechanisms to enforce its provisions. Notably, the European Court of Justice is allowed to rule on violations of the charter only if they happen in the context of implementing EU law.

The sovereignty reflex grew stronger after 2008, when the financial and migration crises weakened the EU’s appeal as a pole of stability and prosperity and revealed the downsides of interdependence. Although they agreed to more EU powers to save the euro, national governments reasserted their sovereignty on other matters.

The Club’s Premium on Cooperation

The daily work of the EU relies on its members trusting each other, with national ministers and officials negotiating in dozens of working groups and committees. Despite countries’ diversity in terms of population size and economic power, officials treat each other with respect in a culture of equality and collegiality. This sense of common purpose is essential for a community of twenty-eight countries to work efficiently, find compromises, and move forward on complex policies. It is a vital characteristic of the EU that makes the union much more effective than other multilateral forums. But it creates a strong preference for reaching decisions by consensus, working on an issue until everyone agrees, and only rarely pushing it to a formal vote.

To preserve the collegiality that allows for day-to-day progress, members prefer to overlook problematic behavior by individual governments, hoping that awkward partners will self-correct and come back to the social rules that allow the EU to work. Accusations of violations of fundamental values and threats of isolation and sanctions would disrupt the culture of cooperation. Only under extreme circumstances would governments be willing to move into open confrontation.

Within the club, there are subgroups whose members are averse to criticizing one of their own. Some are regional, such as the Visegrád foursome of the Czech Republic, Hungary, Poland, and Slovakia; the Nordic members; and the Benelux group. Others are based on shared interests, for example net recipients of EU funds, or Mediterranean agricultural producers. One of the most significant groups is the party families to which members of the European Parliament, European commissioners, and national governments adhere. The center-right European People’s Party (EPP), the largest and most powerful of the party families, is particularly prone to overlook bad behavior rather than punish or cast out misbehaving national parties.

The Glasshouse Syndrome

Heads of government are even more reluctant to criticize one of their peers, because they worry about setting a precedent that could one day be used against them. No EU country has a perfect record in respect of values and principles. National leaders and EU institutions for too long turned a blind eye to problems like former Italian prime minister Silvio Berlusconi’s dominant position in the Italian media and Greece’s massive institutional shortcomings. The same mind-set among leaders makes it hard for the EU to tackle corruption in its members.

Migration and terrorism have made governments even more keen to maximize their margin of maneuver rather than enhance EU-level supervision; this is especially true for those members that are considering introducing restrictive measures in the future. Governments know that a significantly stronger role for the EU institutions on values could expose a lot of them to criticism.

Moreover, the need for unanimity to activate Article 7 sanctions means that two members can deadlock the mechanism by protecting each other. Hungarian Prime Minister Viktor Orbán declared in July that he would “always bear solidarity with the Poles” against what he called an “inquisition,” making it impossible to achieve unanimity. His Polish counterpart would certainly return the favor if the commission threatened sanctions against Hungary.

Reverse Deterrence

Article 7 is often called the nuclear option, because everyone is afraid of using it. Its potential to backfire deters potential users more than it disciplines potential targets. If activation fails because it doesn’t receive enough support, the target government could interpret the outcome as an acquittal that legitimates its actions. If Article 7 does go ahead, it can trigger an escalation that fuels nationalist sentiment against the EU. Public opinion might rally around the government, as happened in Austria in 2000 when the formation of the Schüssel-Haider coalition triggered bilateral diplomatic sanctions by the other members. Claims of unfair outside interference in national sovereignty can even reinforce authoritarian tendencies by delegitimizing domestic criticism.

A government that is committing a serious and persistent breach of EU values is unlikely to subject itself meekly to the censure of its peers and return to the path of virtue, particularly if the survival of the ruling elite is at stake. Moreover, that elite can damage the EU by turning to outside powers such as Russia or Turkey or disrupt EU business by refusing to cooperate across the board. If a government is thoroughly antagonized and spirals away from the EU’s values base, it can cause great damage to the union’s policies and interests. And there is no mechanism to force a member out of the EU.

As a result of these four inhibitions to action, EU governments have a strong default response. At first, they try to ignore offensive behavior. Then, they outsource monitoring and criticism to the commission, the parliament, and the Council of Europe—the continent-wide body that is supposed to uphold human rights, democracy, and rule of law and to which all EU member states belong. If that doesn’t work, they try to sit out the term of the problematic government in the hope that the party will be voted out by its own electorate. But on Poland and Hungary, all these procrastination strategies will run out of road in 2017.

Dismantling the Rule of Law in Hungary and Poland

For too long, other EU governments have viewed the behavior of Hungary’s Fidesz and Poland’s Law and Justice (PiS) governments as unpleasant domestic illiberalism. But what started as infractions of democratic practice after Fidesz returned to power in 2010 and PiS took office in 2015 have turned into capture of many independent state institutions, which undermines implementation of EU law as well. The commission and parliament have now taken strong positions, but most member states have sat on the fence for too long.

The commission concluded in 2016 that the PiS government’s attempts to gain control of the Polish Constitutional Tribunal were a systemic threat to the rule of law. It launched a dialogue under the Rule of Law Framework, a new mechanism introduced in 2014 as a precursor to Article 7. After that dialogue yielded no results and Warsaw tried to push through new laws to control the other courts, the commission stated that it was coming very close to triggering Article 7. Together, the government’s proposed measures “would abolish any remaining judicial independence. . . [because] judges will serve at the pleasure of the political leaders and be dependent upon them from their appointment to their pension,” according to European Commission First Vice President Frans Timmermans. The European Parliament had already expressed concern about the “danger to democracy, human rights and the rule of law” in Poland.

Meanwhile, the commission also decided to take the Hungarian government to court over laws that would restrict the operations of universities and NGOs that receive foreign funding. The commission has already taken legal steps against Hungary for its harsh treatment of asylum seekers and its refusal (along with the Czech Republic and Poland) to take in refugees relocated from Italy and Greece under a plan adopted by the Council of Ministers, in which Hungary was outvoted.

The latest measures on higher education, NGOs, and asylum seekers follow others since 2010 that have put the government in control of the constitutional court and much of the Hungarian media. For many years, Fidesz enjoyed the most powerful source of protection in the EU system: its membership of the EPP. This large group of center-right parties for years shielded Orbán from EU criticism, whereas PiS enjoyed less protection from the much smaller and less disciplined group of European Conservatives and Reformists. The EPP has not expelled Fidesz, but many of the group’s parliamentarians lost patience and voted for a European Parliament resolution in May proposing to launch Article 7 because of the “serious deterioration of the rule of law, democracy and fundamental rights.”

Neither in Budapest nor in Warsaw does the government show any sign of changing course, PiS because of its ideological agenda and Fidesz because of the forthcoming parliamentary election. Although Polish President Andrzej Duda vetoed two of the offending laws and promised to make his own proposals, the Polish government has confirmed its intention to push through its judicial reforms one way or another.

In past years, Orbán has backed down under EU pressure and brought measures to control the media and public institutions into line with the letter of EU law, if not its spirit. But this time, he is making denigration of the EU and its institutions part of his reelection campaign for 2018.

Rising Stakes for the Whole EU

There is both a functional and a normative case for defending values at the EU level. Deep integration—especially with a single market and area of freedom, security, and justice—requires intensive daily cooperation among governments and societies at every level. On the functional side, they need a common basis of principles such as legal certainty, prohibition of arbitrariness, independent and impartial courts, and equality before the law.

The normative case is that countries, like individuals, can trust each other only if they share values of democracy and rights, because these define acceptable behavior between stakeholders. If that trust disappears, cooperation stops and integration unravels. The values listed in Article 2 are intrinsically linked, because violating rights usually involves violating the rule of law.

The EU’s functioning deteriorates when the rule of law doesn’t work properly in all of the union’s members. The EU’s single market and its justice and home affairs cooperation depend on well-functioning independent court systems in all countries. The body of EU law relies on decentralized implementation and enforcement. Deep integration requires deep trust. EU members recognize the decisions of each other’s courts and rely on each other’s regulatory institutions to implement product and environmental standards.

If Poland’s justice minister can control every level of the court system, as PiS’s proposed laws would allow, judgments could be politicized, but judges in other countries would be bound to abide by them under the EU’s principle of mutual recognition. This would create mistrust that undermines judicial cooperation—and damage the business environment in Europe, as the single market would no longer be a level playing field. Already, German companies complain to their government about discrimination in the Hungarian courts; now they worry that they won’t get a fair hearing in the event of a dispute in Poland either.

Political influence over the courts would disrupt judicial and police cooperation too, as many judicial councils in other countries have stated. Such meddling would make other members reluctant to send their citizens for trial in that country under the common arrest warrant, as they are supposed to do automatically. It would also imperil the Schengen area of passport-free travel, which has no border controls, so EU members rely on each other’s police and customs authorities to enforce the law fairly.

Deterioration in the rule of law can make governments less disciplined about implementation of EU law. And if a government doesn’t take its own constitution seriously, it is unlikely to apply EU law rigorously.

In Hungary and Poland, the problem is not just about damage to the rule of law, but also about open defiance of legally binding decisions. Both governments are refusing to take in any asylum-seekers from Greece or Italy under the relocation scheme adopted in 2015. The PiS government has also ignored a ruling by the EU Court of Justice that it should stop logging in Poland’s ancient Białowieża forest.

The risk of contagion is high: if you see your neighbor getting away with not obeying the law, your motivation diminishes to comply yourself. The EU loses cohesion when its members don’t trust their peers to implement and enforce what they have agreed collectively. The EU faced a similar problem when Italy and Greece failed to fulfil their obligation to register refugees under the Dublin asylum system, for example.

Moreover, the EU is losing external clout. Across its neighborhood and in the Balkans, the EU promotes improving the functioning and independence of the judiciary and reducing corruption through better rule of law. It is much harder to convince politicians in Europe’s East and South to stop influencing the courts if the union’s own members are doing the same thing.

Time for Governments to Take a Stand

The European Commission has done well at setting out why the measures taken or proposed by the Polish and Hungarian governments contravene EU laws and values, and followed a consistent legal approach. Now the legal moves need political backup from the Council of Ministers when it returns to the issue in September.

Governments should intensify their bilateral diplomacy at two levels. In private, they need to leave no doubt as to their support for the commission’s actions. Membership of the EPP still matters to Orbán and has long shielded his actions from censure, so members of this party group bear a special responsibility.

In public, European leaders should issue unequivocal statements. They should not let U.S. President Donald Trump have the last word in Warsaw, following his July 6 speech that praised Poland for “treasuring” the rule of law. The most recent statements by German Chancellor Merkel and French President Macron were encouraging. Justice and interior ministers need to speak out, especially when the Hungarian and Polish governments make misleading comparisons to claim that their proposed legislation is similar to practices in other countries. Member states’ embassies should more actively raise rule-of-law concerns bilaterally.

If PiS and Fidesz do not back down, the European Commission and European Parliament will have to decide whether to go through with their threats to launch Article 7(1) by putting forward reasoned proposals on Poland and Hungary respectively. The attitudes of the other members’ governments will be decisive. If the commission puts forward a reasoned proposal and fails to gain the sufficient majority in the council, the EU as a whole will lose face and probably any hope of using Article 7 in the future. But if the commission holds off only because it is not confident of gaining the member states’ backing, PiS could also claim victory.

However, if Article 7(1) is successfully launched, meaning that the EU institutions agree that there is a clear risk of a serious breach, that would send a powerful political signal—even if mutual protection between Warsaw and Budapest makes it impossible to gain unanimity in the European Council to activate any sanctions.

All EU-level action must be well framed and communicated to avoid fueling nationalism and a sense of East-West divide. The Polish and Hungarian governments claim that they are being unfairly targeted by the western EU establishment and compare the debate on the rule of law to other issues on which East and West are divided, such as the union’s post-Brexit budget and potential “variable geometry” through different kinds of membership. But it is different in kind as well as scale.

EU actors must therefore explain why they have to protect core EU standards, and make it clear that steps will be taken against any government that undermines EU law. Strong statements from other Central European governments would be particularly helpful. The EU can also counter claims of double standards by getting tougher on bad behavior by member states across the board, particularly on corruption and misuse of public funds.

The next year will see new initiatives for EU institutional and policy reform as well as negotiations on future EU financing, which will open opportunities to introduce new instruments to protect the rule of law. There are plenty of options to consider. Most pertinent to the cases of Hungary and Poland are greater possibilities for judicial review by the European Court of Justice, to capture the cumulative effect of a series of infringements that creates a systemic challenge.

Money matters too. Germany and other countries are considering whether to propose new conditions that would tie access to EU funds to a country’s performance on governance and the rule of law. This would be complicated to introduce, legally and politically, but it would have a powerful deterrent effect. In the meantime, more rigorous enforcement of existing rules on misuse of funds would strengthen popular support for EU action against abuse of power and corruption in all member states.

The EU has to become more active in countering false claims. Two-thirds of Hungarians have a favorable view of the EU, as do three-quarters of Poles. To try to reduce this level of support, the Hungarian government in 2017 funded a huge campaign of anti-EU slogans and false claims about the EU’s role in deciding energy prices, taxes, and migration, among other things. To counter this propaganda, EU actors need to communicate the facts about the union’s laws and policies, as the commission did for the first time this year in a rebuttal fact sheet. This kind of engagement helps Hungarian and Polish civil society to hold their countries’ governments to account and uphold their constitutions, and shows that criticism of governments does not mean rejection of the people.

Conclusion

The EU institutions are running against the global trend by defending liberal values at a time of rising illiberalism and nationalism. They have no choice, because the EU’s legal and normative framework, which is essential to its deep economic and political integration, is under major threat. If the EU allows two members to get away with reneging on core values, the contagion effect will be huge, both in the union and its region. More governments will be tempted to override constitutional checks and balances, intimidate journalists and close down critical voices in universities and NGOs.

The EU’s role is not to get involved in political fights in its member states. Members should remain free to decide on their own constitutional arrangements through national democratic processes. But the EU’s institutions have to defend common standards on the core obligations that allow members to trust each other to stick to commitments, and they must ensure citizens and businesses can operate across borders without discrimination. The rule of law is fundamental to this trust.

The priority now is a sustained, targeted, and coordinated campaign by national leaders at two levels. The first is for EU heads of state and government to convince Budapest and Warsaw to change course. The Hungarian and Polish leaders have to hear tough words from national capitals expressing full support for the Brussels institutions. Both governments need to know that if they do not backtrack, there will be a high price to pay.

At the same time, the EU’s institutions and the other twenty-six governments have to communicate publicly why values are essential to the functioning of policies that benefit European citizens. The ultimate hope for remedy lies with the tens of thousands of Hungarians and Poles who have been protesting against the attempts to capture their states. They need to hear other Europeans’ support for safeguarding democracy and the rule of law in their countries, because it matters for everyone.

Heather Grabbe is the director of the Open Society European Policy Institute.