Using go-it-alone power to overcome intergovernmental deadlock: national vetoes, credible threats, and multi-speed Europe in the British budgetary rebate crisis

Abstract Differentiated integration, and the prospect thereof, is a prominent feature of European integration and policymaking. This article theorizes and demonstrates an explicit link between the threat of differentiated integration and the resolution of major European integration crises. Based on archival sources and secondary literature on differentiated integration, it shows how and why, in June 1984, the United Kingdom and Prime Minister Margaret Thatcher agreed to increase the European Community’s (EC) financial resources, despite their years-long insistence on budgetary restraint and their formal right to veto such a decision. The article argues that the prospect of a ‘multi-speed’ Europe, represented by Franco-German ‘go-it-alone’ power, threatened to exclude recalcitrant member states. Lacking more promising alternatives to continued membership in a reformed EC, the British government consented to European financial objectives. It also joined the other national governments towards deeper political integration and, eventually, a European Union, despite its actual rejection of European federal ambitions. The article’s theoretical expectations and empirical findings on ways to overcome intergovernmental deadlock based on formal national veto rights have broader implications also for more recent European integration crises.