The Danish referendum on Euro entry, September 2000

The Danish referendum on Euro entry, September 2000

Notes on Recent Elections / Electoral Studies 21 (2002) 473–533 493 The Danish referendum on Euro entry, September 2000 Mads Qvortrup * Department o...

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Notes on Recent Elections / Electoral Studies 21 (2002) 473–533

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The Danish referendum on Euro entry, September 2000 Mads Qvortrup * Department of Government, The London School of Economics, Houghton Street, London WC2A 2AE, UK

On 28 September 2000, Danish voters rejected Euro membership in a referendum, by a margin of 53.3% to 46.7%. Turnout was exceptionally high, at 87.8%. The referendum was closely followed by the mass media in Europe and around the world, and the result was widely interpreted as a warning to governments—namely in the UK and Sweden—contemplating a referendum on the same issue. The outcome was, broadly, a result of two factors: disagreements within the coalition on the ‘Yes’ side, and that side’s failure to convince a majority of voters that joining the Euro was consistent with their preferences.

1. Background The 2000 referendum was the result of an exemption granted to Denmark following their rejection of the Maastricht Treaty in a referendum in June 1992. At the Edinburgh Summit in December 1993, the other EU governments had accepted that Denmark could remain outside the WEU and European Monetary Union. This socalled Edinburgh Agreement was ratified in a referendum in May 1993. The referendum in September 2000 was necessary under Article 20 of the Danish constitution, which stipulates that transfers of sovereignty to international organisations require the consent of voters in a referendum.

2. The campaign Polling day was the culmination of six months of non-stop campaigning, in which the ‘Yes’ side (the Radical Social Democrat government and the main bourgeois parties, Venstre and the Conservatives) had been forced onto the defensive against the ‘No’ side (dominated by the far right Danish People’s Party, the far left Socialist People’s Party, and the grassroots ‘June Movement’). Having led in the polls by 6–

* Corresponding author. Tel.: +44-020-7405-7686. E-mail address: [email protected] (M. Qvortrup).

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8 percentage points in March, the ‘Yes’ campaign gradually lost ground. By May, the ‘No’ side was ahead by a whisker. It is surprising that the ‘Yes’ side found things so difficult, since they had several apparent advantages: the main political parties, the main unions and employers organisations, and virtually all of the press, supported Danish entry into the Euro.1 However, the ‘No’ side was very effective in shifting the agenda and focusing voters’ attention on what they described as the dominance of the EU by larger member states at the expense of the smaller. A commonly cited example was the EU-imposed boycott against Austria following the inclusion of Jo¨ rg Haider’s Freedom Party in the Austrian government. Emphasising this example proved effective, as a large number of voters—as well as Venstre and the Conservatives, two of the ‘Yes’ parties— were strongly opposed to the EU’s actions. Focusing on the Austrian case thus enabled the ‘No’ side to drive a wedge between the ‘Yes’ parties, as well as distracting attention from the economic case for the Euro. The press described the ‘Yes’ campaigners as ‘amateurs’ and ‘old fashioned’ and criticised them for ‘failing to utilise modern campaigning techniques’ (Boersens Nyhedsmagasin, 25 September). Their defeat is still more noteworthy since fifteen of the nineteen referendums on European integration have resulted in a ‘Yes’ outcome (Qvortrup, 2001).2 The successful referendums in Britain in 1975, Denmark in 1993, and Sweden in 1994, each followed negotiations between the respective states and the EU (or EEC). These negotiations were all initiated to accommodate electorates who preferred rather less integration than their governments (Butler and Kitzinger, 1996: 21; Bjorklund, 1997: 89). Those governments succeeded in meeting the median voter’s preferences, and hence in securing positive outcomes. Alas for Prime Minister Poul Nyrup Rasmussen, he was in no position to negotiate. Nor were the other EU countries in a position to grant concessions to the Danish government. The choice was crude and, cast in traditional Danish terms, was simply ‘to join or not to join?’ Fundamentally, the Danish voters’ preferences were not consistent with the government’s position. While they were willing to contemplate membership at a ‘later stage’, a sizeable majority indicated throughout the campaign that they were opposed to Euro entry (Thomsen et al., 2001: 83). Moreover, the euro’s daily battering on the currency market hardly convinced the prosperous Danes of the necessity of giving up the krone. However, it seems very possible that the ‘Yes’ side could have won the referendum through massive campaign effort, both in terms of spending and expertise. The literature on referendums contains an abundance of examples of referendums won despite public hostility at the beginning of the campaign (Worcester, 2000: 37). And one would have expected that those on the ‘Yes’ side would, and could, have used their financial and organisational advantages over the fringe and grassroots groups in the ‘No’ camp. It is important to consider why they were unable to so.

1

Only the tabloid Ekstra Bladet was opposed to joining. This statistic is specific to European integration rather than general to referendums: only 48.5% of all referendums held after 1945 have resulted in a ‘Yes’ outcome (Qvortrup, 2000: 823). 2

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3. The ‘Yes’ campaign The Social Democrats, Venstre and the Conservatives were all squarely in favour of Danish entry to the euro. Yet the prospect of a general election loomed on the horizon. While a referendum defeat would be a disaster for both groups, it was widely believed by both sub-groups within the ‘Yes’ camp that ‘the other side would reap the [electoral] benefits of a positive outcome’ in the referendum co-operation would have been an ideal option; however, both sides feared that the other side would be ‘less than sincere, if we were to engage in active co-operation’.3 As in a prisoner’s dilemma, the parties on the ‘Yes’ side feared that their partners would free ride. Venstre, the main opposition party, did not contribute financially to the ‘Yes’ campaign since their leadership feared that the Social Democrats would hold their own fire—and save their money for a post-referendum election. The Social Democrats were reluctant to commit themselves, and open their coffers, lest Venstre (and the Conservatives) were to campaign half-heartedly, to blame the Social Democrats for a ‘No’ outcome, and to reap the benefits in a general election. Yet such mutual suspicion was not confined to the Social Democrats’ relations with Venstre. There was rivalry between the two factions within the Social Democrats, and between Venstre and the Conservatives. The Conservatives, having lost most of their state funding following their disastrous result in the 1998 general election, were reluctant to spend money in the initial phases of the referendum campaign in case this made it impossible to finance a general election. They feared that the richer Venstre would be the ultimate beneficiaries of Conservative spending in the referendum, winning Conservative seats in a general election (Boersens Nyhedsmagasin, 25 September). Venstre was similarly reluctant to spend on the campaign, for parallel reasons; significant spending would drain the Venstre war chest, which could be disastrous if it allowed the Conservatives to win back seats lost in the general election in 1998. Venstre’s leader, Anders Fogh Rasmussen, was reluctant to jeopardise his lifelong ambition of making Venstre bigger than the Social Democrats. The mutual suspicion that the other party would free ride resulted, once again in lack of co-operation. Rational parties, but an irrational outcome. The Social Democrats suffered from rather similar problems. The party had been internally split since Poul Nyrup Rasmussen had seized power in a coup de palace in 1993. The left wing of the party—headed by former leader Svend Auken—feared that a ‘Yes’ vote would strengthen the leadership. The left was consequently lukewarm in their support for the euro, even though they were clearly in favour of a ‘Yes’ rather than a ‘No’ vote. Rasmussen was therefore forced to campaign knowing that he lacked full support from his own party, which made his position more precarious and his task all the more difficult.

3 Both quotations are from an interview with Soren Totf, Venstre’s campaign manager, conducted by the author.

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4. The ‘No’ campaign The ‘No’ coalition was no less diverse than the ‘Yes’ side; probably more so. However, for the parties on the ‘No’ side defeat in the referendum was the nightmare scenario. This shared fear of a ‘Yes’ result led to mutual co-operation between the Socialist People’s Party and the far right Danish People’s Party. It was even rumoured that the wealthy June Movement channelled money to the independent conservative MP Frank Dahlgaard (Boersens Nyhedsmagasin, 18 September 2000). The reason why co-operation was so much easier in this case is straightforward: the ‘No’ parties were not electoral rivals. (The June Movement does not contest parliamentary elections.) This side could concentrate on the referendum, unlike the ‘Yes’ side, for which the referendum was not necessarily the top priority, and which was therefore engaged in shadow warfare on several levels.

5. The outcome: centre versus periphery Referendums in Scandinavia have been characterised by a considerable difference between the voting patterns in the centre and the periphery (Bjorklund, 1994: 152). The peripheries in Norway, Sweden, and (to a certain extent) Finland, have traditionally voted more conservatively than the centre; the same has been true of Denmark. The Danish periphery voted against the land laws (planning laws) in four referendums in 1963 (Bjorklund, 1994: 91), and the largest proportion of ‘No’ votes in the 1953 constitutional referendum was recorded in Jutland and on the islands in the periphery. Unlike in Norway and Sweden, however, in Denmark the highest support for the EU (and EEC) has tended to come from the periphery. This relatively unusual split is principally due to party political preferences. In Denmark, the European Union has traditionally been perceived as a project of the political right. Consequently, support for the EU has been strongest among Conservative and Venstre voters. There has been only lukewarm support, at best, from Social Democrat voters (the parliamentary party was split in 1972, and recommended a ‘No’ in 1986), and outright hostility from Socialist People’s Party voters. That the bourgeois parties generally poll better in the periphery might thus explain why these areas have traditionally returned large ‘Yes’ votes in European referendums, while comfortable ‘No’ majorities have resulted in Copenhagen (dominated by the far left). As Table 1 demonstrates, the 2000 referendum vote did not radically alter this picture, though a movement can be discerned. Ringkøbing, a bastion of the Liberal party in the west of the country, returned a bare 50.5% majority of ‘Yes’ votes (somewhat lower than the 60.1% average in previous referendums). Even more strikingly, another Liberal stronghold, Bornholm, returned a 60% ‘No’ vote, compared with a similar majority of ‘Yes’ votes in 1972 and 1986. This does not simply reflect a nationwide switch to ‘No’ voting: the ‘No’ vote in Copenhagen did not increase. What changed, therefore, was the greater willingness of Venstre and Conservative voters to vote ‘No’: 21.1% and 24.5% respectively did so, compared to a typical

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Table 1 Results of the 2000 Danish referendum on Euro membership, by region County Ribea Sønderjyllanda Fyn Vejle ˚ rhus A Frederiksborg Roskilde Vestsjælanda Bornholma Søndre Storkreds Vestre Storkreds Østre Storkreds Copenhagen Nordjyllanda Denmark

Yes (%) 48.0 48.5 46.2 47.8 48.8 50.7 48.2 42.3 41.1 44.4 47.4 45.5 47.8 43.3 46.7

Turnout (%) 87.5 87.8 87.2 87.8 87.9 89.1 90.0 85.5 85.4 82.0 85.2 84.5 88.8 86.9 87.8

Source: TV-2 a County in a rural area.

‘No’ vote of less than 15% among these voters (TV-2/Megafon 28 September 2000). It was this shift that sealed the fate of Denmark’s entry into the euro. The reasons for this shift may be as many as there are voters in this category. However, polling and exit polls conducted by the news channel TV-2 suggests that above all it was the Austrian case that pushed liberal and conservative voters into the arms of the ‘No’ side (TV-2/Megafon 28 September 2000). This suggests that the outcome of the Danish referendum was a result of truly unique circumstances; that is, circumstances that are unlikely to obtain in other potential referendums such as in the UK or Sweden. However, the rejection of the euro by the economically backward parts of the country, such as Bornholm, might also be seen as an indication that the regions that hitherto have been beneficiaries from structural aid have become sceptical as the Brussels wells have dried up. This would have more serious implications for any government planning a referendum on an EU related issue.

6. Conclusion The Danish referendum on euro membership resulted in rejection of a policy supported by the government and the two main opposition parties. The booming economy prevented the ‘Yes’ campaign from highlighting the euro’s raison d’eˆ tre, namely economic stability. It was difficult for voters to believe that the introduction of the single currency was necessary, especially since the euro was depreciating against the dollar on a daily basis. Previous referendums, for example in May 1993, had been won in the face of initial scepticism because governments presented a revised

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policy that accommodated voters’ preferences. This was not an option in 2000: the government was unable to make concessions to the electorate, since the choice had to be simply ‘Yes’ or ‘No’. The ‘Yes’ side was further split as a result of internal rivalries between the respective ‘Yes’ parties. The fear that Prime Minister Rasmussen would call a general election in the wake of the referendum increased the suspicion among the ‘Yes’ parties. Ironically, then, the parties’ fears of what might happen following a ‘Yes’ outcome may have cost them a positive result. In the end, of course, the government did not call a general election, precisely because of the unfavourable referendum result. The referendum had no immediate disastrous political consequences. The markets did not react, the government did not resign, and Denmark’s relations with other EU countries were not affected by the outcome. Nevertheless, there are lessons from Denmark to be learned by any government contemplating a referendum on entry to the euro. The result suggests that a unified ‘Yes’ front may be a mixed blessing, especially if in-fighting tends to undermine the co-ordination of the campaign. The Danish ‘Yes’ campaign was anything but co-ordinated, and it paid the price for this.

References Butler, D., Kitzinger, U., 1996. The 1975 Referendum. Macmillan, London. Bjorklund, T. 1994. Public Opinion Towards Membership in the EU: The Case of Norway. Department of Political Science, Working Paper, University of Oslo, 1994. Bjorklund, T., 1997. Om Folkeafstemninger. Universitetsforlaget, Oslo. Qvortrup, M., 2000. Are referendums controlled and pro-hegemonic? Political Studies 48, 821–826. Qvortrup, M., 2001. How to lose a referendum. Political Quarterly 72 (2), 140–146. Thomsen, S.R., Jacobsen, M., Reinert, R., 2001. Afstemningen om den faelles moent—social baggrund og holdninger. Tidsskrift for Politisk Videnskab 33, 66–88. Worcester, R., 2000. How to Win a Referendum: Lessons from 1975. The Foreign Policy Centre, London. 0261-3794/02/$ - see front matter  2002 Elsevier Science Ltd. All rights reserved. PII: S 0 2 6 1 - 3 7 9 4 ( 0 1 ) 0 0 0 4 5 - 2