No job rush but stakes are high

he most important thing to remember about the impending enlargement of the European Union is just how unimaginable it would have been only a short time ago.

Anyone who had suggested in spring 1989 that the European Community would in 15 years be taking into membership a majority of the states of east-central Europe would have been a political laughing stock. The division of the Europe into two hostile blocs and Soviet domination of the east were givens, taken by just about everyone as unpleasant facts of political life that were likely to last a very long time if not forever.

Yet here we are in 2004, and the European club is about to welcome 10 new members, among them four states that were Soviet satellites in 1989 (Poland, Hungary, the Czech Republic and Slovakia) and three that were actually part of the Soviet Union (Estonia, Latvia and Lithuania).

Of course, they will be second-class members when they join on 1 May. For some time, their citizens' freedom to work wherever they want in the European Union will be restricted, and their farmers will be denied the level of subsidy enjoyed by their counterparts in existing EU member states under the Common Agricultural Policy. None of the new member states will be part of the eurozone, either.

But none of this should be allowed to obscure the momentous importance of this enlargement of the EU. It marks the definitive end of the cold-war division of the continent and the near-achievement of the pioneering 1930s European federalists' dream of a united democratic Europe.

Of the countries everyone agrees to be European, only Albania, Romania, Bulgaria, the states of former Yugoslavia - apart from Slovenia - and Switzerland are now outside the EU. And that is no mean achievement (although of course there is a strong case for arguing that any definition of 'European' that excludes the Russians, Byelorussians, Ukrainians, Georgians and Turks is far too narrow). Even in the late 1990s, when the enlargement proposed was less far-reaching than the one that is now happening, plenty of informed people thought it impossible before 2010.

Which is not to say that the entry of the 10 new members will be unproblematic. In particular, every government in the pre-enlargement EU is worried, to a greater or lesser extent, about the possibility of a giant influx of workers from the accession countries, chasing better wages and better welfare provision. Even the British government, which expects few accession-country immigrants and would anyway welcome them because the labour market is tight, has changed benefit rules to exclude migrants from the accession countries. Nearly all the others, with Germany and Austria in the vanguard, have imposed strict quotas on immigration from the EU's new members.

Immigration is the issue likely to have the biggest impact in the short term on the politics of the EU. To put it bluntly, if the controls over and disincentives to immigration don't work - or, rather, are seen as not working by voters in the existing member states, there is a possibility of a swell of anti-immigrant sentiment that is successfully exploited by the right in the west.

This is, however, no more than a possibility. For a start, it is by no means certain that very many people from the accession countries will leave their homelands. Up-rooting everything to work abroad is not something people generally do unless they are either unusually adventurous or suffering from extreme poverty or persecution - and extreme poverty and persecution are not the lot of most citizens of the accession states, with the partial exception of the Roma of Slovakia and the Czech Republic. The last time the European Community embraced a batch of much poorer countries - Greece, Spain and Portugal in the 1980s - there was no mad rush of migration, and there is no reason to expect this time to be different.

What's more, it is doubtful that migration from the accession countries will in itself lead to a swell of anti-immigrant feeling even if large numbers move west. There are already many people from the accession countries living in the pre-enlargement EU - and although it would be idiotic to claim that they are never victims of discrimination or prejudice, with the exception of the Roma they are pretty much invisible. They are white and indistinguishable from the majority population by way of religion, dress or social habits - and thus rather difficult to turn into scapegoats for the troubles of the majority. 'Vote Labour if you want a Latvian for a neighbour' just won't wash.

The problem with this scenario is the exception to the rule of invisibility, the Roma - in Britain at any rate. Already, the right-wing press here is running scare stories about the imminent arrival of a flood of gypsies, many of them former failed asylum-seekers. So far, only the British National Party has shown any interest in exploiting the scare for electoral gain, but if it turns out to have any basis in reality it is by no means unlikely that the Tories will jump on the bandwagon, pushing a cocktail of anti-European, anti-immigrant xenophobia as their core political message at the next general election. We shall see.

EU enlargement is important politically not only because of the impact of migration on the domestic politics of current member countries. It will also have ramifications for the EU's political balance, for the economies of the whole union and for the way the EU's institutions work.

The effects of enlargement on the political balance of the EU will be less marked than they would have been had it happened in the late 1990s, when social democratic parties were in power in the four biggest EU countries, Germany, France, Britain and Italy - not that they acted in concert, to their shame - and most of east-central Europe was governed by the centre-right. The ascendancy of the centre-left in western Europe was fleeting, and today the existing EU is roughly split between centre-left and centre-right governments. In east-central Europe, there was a shift towards the centre-left in 2001-02, though hardly one of seismic proportions, and today the accession countries' governments are roughly split between centre-right and centre-left, much as current EU governments are.

But there are significant differences between east and west in the new EU, particularly on foreign policy, with the accession countries generally far more favourable to the United States. The governments of 'new Europe', as Donald Rumsfeld called it, were much closer to Tony Blair in their response to the wars in Afghanistan and Iraq than those of 'old Europe'.

How far this will make any difference in the next couple of years is hard to tell, because no one knows what (if anything) the US will do now in its 'war on terror'. As ever, what will matter most in European Union politics are general elections in the member states. With nearly as many governments east and west looking vulnerable to election defeat, no one can predict with confidence what the situation will be in a couple of years' time. This year's European Parliament elections will be an indication of the state of play, but with turnouts everywhere expected to be low even they will need to be taken with a pinch of salt.

The economic effects of enlargement are even more difficult to judge. It should be an engine of growth throughout Europe as everyone benefits from the opening of markets - but it might simply benefit the accession countries, exacerbating the globalisation-led flight of employment from the high-wage countries of western Europe while the poorest parts of western Europe suffer from the diversion of EU cash to the accession countries. Whatever, it is likely to have rather less influence on Europe's economic performance than exchange rates (particularly if the US maintains its weak dollar policy) and the onward march of globalisation.

As for the workings of the EU's institutions, enlargement will certainly mean a far greater emphasis in the short term on intergovernmental wheeling and dealing - and this in a set-up that is already dominated by intergovernmental carve-ups - for the simple reason that there is no alternative. In the medium to long term, however, everything is up for grabs. The proposed EU constitution is essentially inter-governmentalist, with a few sops to federalism. But there is little sense anywhere that it is a final settlement of the union's institutional arrangements. No one knows whether its provisions will come into being, let alone that they will prove lasting if they do.

It's true that it does currently seem unlikely that a polity as big and diverse as the enlarged EU could successfully evolve towards federalism. On the other hand, however, there are powerful pressures in the other direction: the euro, which demands a coherent centrally controlled fiscal policy; the likelihood that the smaller countries of the new EU will tire of being dominated by the big ones; and the EU's much-discussed lack of democratic legitimacy, which can only be addressed by giving the European Parliament a much greater role, including the power to initiate legislation.

In other words, it's business as usual on the European scene. There is no way the left can guarantee a social democratic Europe after enlargement. But there is also no reason to give up on that goal, which is no less credible than it ever has been.