Habermas' confidence in the cunning of technocratic reason replacing national particularism with European universalism raises the question of what exactly the fault is that he finds with the really existing European technocracy, and what he hopes will take its place when its ‘lure’ – or, perhaps, its cunning? – will have done its work. But at this point, again, the argument remains hazy, although what is at issue would appear to be nothing less than the difference between capitalism as it is now and capitalism contained and constrained by democratic social and political powers. Instead, Habermas speaks of a ‘transfer union’ (9, passim), without discussing who is to transfer what, and how much, and to whom. More generally, he observes that technocracy without democratic roots would neither have the power nor the motivation to accord sufficient weight to the demands of the electorate for social justice, status security, public services and collective goods, in the event of a conflict with the systemic demands for competitiveness and economic growth. (pp. 11f.)

But would a technocracy with democratic roots? Habermas seems to believe that the political- economic problem of Europe is basically a lack of sensitivity to popular demands in European decision-making centres that could in principle easily be remedied if only such demands were given a constitutional opportunity to make themselves heard, in a parliament devoid of a state. Moving electoral democracy from the national level, where rising interdependence has rendered it ineffective, to the European supranational level would, or so Habermas suggests, make ‘systemic demands’ once again malleable to human counter-demands, simply by enlarging ‘the basis of legitimation’ to match ‘the expansion of steering capacities’ (p. 11).(7)

Is this in any way realistic? For Habermas, the enemy is not capitalism but technocracy, and only as long as its congenital insensitivity to popular sentiments endangers the project of European de-nationalization. In this perspective, the transfer of political-economic decision-making in past decades to electorally unaccountable institutions, such as an independent central bank, appears as no more than a side-effect of honest efforts to resolve increasingly difficult problems of international interdependence. De-democratization did occur, but mostly by accident and oversight in the heat of a running battle with difficult problems of coordination, perhaps reinforced by deplorable although corrigible non-democratic habits on the part of hard-working problem-solvers, but clearly not with a pro-capitalist neoliberal intention or as a concession to growing capitalist power. Thus it can be healed, the ‘systemic demands’ of contemporary capitalism notwithstanding. Indeed ultimately, it is not capitalism that is the problem in Habermas’ Europe, but its management. What is wrong with the Europe of monetary union, Habermas implies, is not that it is pro-capitalist, or subservient to capitalist interests, but that it is –contingently – non-democratic, thereby subverting the struggle against the real enemy, nationalism. Democracy is to correct this by making the demands of ordinary people heard as decision-makers attend to ‘systemic demands’, refilling the system’s supply of legitimacy. No need to confront the increasingly insatiable demands of the profit-dependent classes for precedence of their interests over those of the rest of society. In fact interests do not really appear in Habermasian European theory, only biased cognitions of decision-makers in need of democratic correction. This disregards the fundamental insight of critical political economy that ‘the economy’ is fundamentally not about more or less enlightened management but about more or less manifest class conflict, in which the adversary of ‘the people’ is not technocracy but capital (Mouffe 2005). Hidden behind what dresses up as systemic necessities, indeed as ‘economic laws’ and ‘economic reason’, are interests as shaped by evolving relations of economic and political power, today in particular the changing power balance between increasingly global capital and inevitably local labour. There is no way one can talk about European democracy without also talking about capitalism.