• Slovenia and Europe are facing a rapidly ageing population. According to current projections, Slovenia will be among the countries with the oldest population in the EU in 2050, and in 500 years there will be no more Slovenians. Shifts in the population’s age structure are already having an impact on all levels of our lives today; everything from pension system sustainability to healthcare capacities, economic competitiveness to various other issues.

    At the Anton Korošec Institute, in cooperation with the Wilfried Martens Centre for European Studies, we organised our first joint project entitled Demographic challenges of Slovenia and Europe, this year. The project aims to shed light on some of the above-mentioned issues and to open a wider public debate on how we will live differently in the future. In August, a well-attended and content-rich round table was held in Ankaran. Speakers touched on the problems of population ageing and presented their views and solutions to worrying demographic trends in Slovenia and Europe. The publication that is now in front of you was created as a continuation of this project.

    EU Member States Society

    Demographic Changes in Slovenia and Europe

    Collaborative

    31 Dec 2020

  • A podcast series that aims to challenge commonly held assumptions about the European project in a tour de force through European history, culture and civilisation. Podcast host Federico Ottavio Reho redefines political correctness with the help of razor-sharp arguments and beautifully drawn historical parallels.

    Federico Ottavio Reho EU Member States European Union Values

    [Europe Out Loud] A Threatened European Cultural Heritage?

    Europe out Loud - Multimedia

    22 Dec 2020

  • The Week in 7 Questions brings you today MEP Siegfried Muresan to discuss the EU Recovery Fund and the Polish & Hungarian potential blocking.

    Siegfried Mureşan Roland Freudenstein Economy EU Member States

    The Week in 7 Questions with Siegfried Mureșan

    Multimedia - The Week in 7 Questions

    27 Nov 2020

  • Our President, Mikuláš Dzurinda, welcomed everyone to the first-ever Digital NET@WORK

    Mikuláš Dzurinda COVID-19 EU Member States

    NET@WORK Day 1 – Welcoming Remarks

    Live-streams - Multimedia

    25 Nov 2020

  • Roland Freudenstein EU Member States

    The Week in 7 Questions with Małgorzata Durska

    Multimedia - The Week in 7 Questions

    13 Nov 2020

  • Petri Sarvamaa is Roland’s surprise guest this time! Watch the EPP Group MEP’s answers on Rule of Law across the EU including his country, Finland, which should be the institution ensuring it, and how does Putin’s Russia see the debate.

    Roland Freudenstein EU Institutions EU Member States EU-Russia

    The Week in 7 Questions with Petri Sarvamaa

    Multimedia - The Week in 7 Questions

    16 Oct 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    Baltic EU Member States

    Back2EU from Estonia with Pro Patria Instituut

    Multimedia - Other videos

    07 Oct 2020

  • The Swedish policy response to COVID-19 is exceptional by international standards. This In Brief explains how this approach is determined by three articles in the Swedish Constitution. The first guarantees freedom of movement for Swedish citizens, ruling out nationwide lockdowns. The second establishes unique independence for public agencies, allowing them to design the policy response to the pandemic. The third grants exceptional powers to local government. In addition, the Swedish approach is fostered by strong trust in the government and in public authorities.

    COVID-19 EU Member States Leadership Social Policy

    The Constitutional Basis for Sweden’s Exceptional COVID-19 Policy

    IN BRIEF

    28 Sep 2020

  • Since 1 September, the Hungarian government has closed its borders due to the rise in new COVID-19 cases. However, there is an exception made for those citizens of Slovakia, Czechia, and Poland, who work, study, or travel to Hungary. The decision has provoked a reaction from the EC, who calls to respect the integrity and non-discriminatory nature of the Schengen area. How do you perceive this unilateral step from Hungary, especially since its neighbours, such as Serbia and Romania, have many more COVID-19 cases, and yet their borders remain open?

    Dániel Bartha – Executive Director, Centre for Euro-Atlantic Integration and Democracy, Hungary: The government was rushing to make a highly visible decision. They even failed to inform Hungarian authorities, such as the Border protection agency, on time. The decision to keep V4 relations unchanged was based on political considerations and the experience from the spring when these countries had much lower numbers. Later, the decision was corrected, but it shed light on some dysfunctionality in decision-making. I wouldn’t consider it an anti-EU move, although the EU should be criticised for not using the summer period to further harmonise the decision-making process regarding the closure of Schengen borders, which gives more room to such unilateral decisions.

    Vladimír Bartovic, Director, EUROPEUM, Czechia:  I am generally against the closure of borders between EU member states. Of course, all countries have the right to protect their citizens from the spread of COVID-19, but in my opinion, countries should demand a negative COVID-19 test, rather than closing the borders.

    I agree with the European Commission that Hungary’s decision to give exemptions based on citizenship is discriminatory. If there are some exemptions, they should be based on residence rather than citizenship, and well-argued from the epidemiological point of view.

    Miriam Lexmann, Member of the European Parliament, Slovakia: The unilateral closure of borders in March 2020 has highlighted the need for EU Member States to coordinate or, at the very least, to communicate their intentions in advance. No doubt, the closure of borders opens a moral question of whether freedom of movement is more important than the protection and health of citizens. Yet, there are mechanisms in place for situations where Member States must re-impose internal Schengen borders. Therefore, I think that such steps should be coordinated within the EU in advance, and according to set mechanisms, so that citizens and other countries impacted by the situation can adequately prepare.

    Much attention is being paid to the Czech Senate Speaker Miloš Vystrčil, who made an official visit to Taiwan, accompanied by a large delegation of politicians, businessmen, and scientists. According to Chinese Foreign Minister Wang Yi, Vystrčil will pay a very high price for his visit to Taiwan, thereby not respecting the One-China Principle. His trip was supported by the Slovak president, along with French and German officials. Can we expect that the Visegrád Group will adopt a less assertive approach towards China?

    Dániel Bartha: Hungary will be the last country to join the V4 on this issue, but if it is necessary, it will show solidarity with Czechia. Although 16+1 can be declared dead, the government is still convinced that keeping the country in the Euro-Atlantic alliance and having good relations with China are simultaneously possible, despite EU and NATO membership officials often referring to a neutral status. Obviously, this position is not sustainable, but it’s important to understand that economic interests are the only aspect which the government considers. While the economy will contract by 7 to 10%, and Hungarian trade volume was falling in every direction, we have recorded a 20% growth in import volume and a 4% growth in export to China.

    I believe Chinese and Czech relations are poisoned, and we have passed the point of return for good relations. It is now a matter of time before Slovakia will join Czechia on this issue. Due to its geopolitical interests, Poland will support the US position on China, which will soon leave Hungary alone on this issue within the V4.

    Vladimír Bartovic: How to approach relations with China was, is, and certainly will be a very divisive issue, not just among the different countries, but also between different political parties, and even between different politicians within individual parties, as the Czech example demonstrates. The Czech Senate Speaker Mr. Vystrčil’s journey to Taiwan was criticised by other Czech representatives, such as President Zeman or Prime-Minister Babiš. But the Chinese reaction, consisting of blackmailing and threatening Mr. Vystrčil and other members of the delegation, crossed all lines of acceptable diplomatic behaviour. I would have expected more solidarity from the Visegrád states’ representatives, or even from the EU as a whole in this case. Visegrád foreign ministers could have declared that the language used by Minister Wang Yi is unacceptable. On the other hand, I do not expect any changes in the approach of V4 countries towards China in reaction to this incident.

    Miriam Lexmann: As was stated in an open letter I initiated with Alexandr Vondra (Czech Republic/ECR) in support for Mr. Vystrčil and signed by nearly 70 political leaders worldwide, all sovereign countries have the right to determine their relations with Taiwan without the interference of the Chinese Communist Party.

    Given the vulnerabilities exposed during the current pandemic, the realities of the corrosive impact of Chinese investment in some countries, and empty promises in others, as well as the arrogance of Chinese diplomats and officials, there is an ongoing shift in opinion about the Chinese authoritarian regime within the Visegrád Group. There is, however, the need for an EU-wide re-assessment of our relations with China. Therefore, it is not simply a question for the Visegrád Four whether to adopt a more assertive and principled approach, but for the whole of the EU.

    Eastern Europe EU Member States Foreign Policy

    Are the Visegrád Four ready for a new approach towards China?

    Other News

    14 Sep 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    EU Member States

    Back2EU from Italy with Fondazione de Gasperi

    Multimedia - Other videos

    01 Sep 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    Loredana Teodorescu EU Member States

    Back2EU from Italy with Istituto Luigi Sturzo

    Multimedia - Other videos

    25 Aug 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    EU Member States

    Back2EU from Slovenia with INAK

    Multimedia - Other videos

    17 Aug 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    EU Member States

    Back2EU from Czechia with Topaz

    Multimedia - Other videos

    03 Aug 2020

  • The role of small member states in EU foreign policy is increasingly being challenged, especially in view of the reforms being proposed to make the EU more effective as an international actor. These reforms, if adopted, will require the small Central and Eastern European member states, such as Bulgaria, to rethink their old foreign-policy strategies and practices. Instead of band-wagoning and balancing conflicting interests, these small member states will have to learn to be more proactive, to build their reputations and to form alliances if they want to continue to have any influence on EU foreign policy. These issues are discussed in the light of the EU sanctions adopted against Russia in the aftermath of the Ukrainian–Russian conflict of 2014.

    Read the full article of the June 2020 issue of the European View, the Martens Centre policy journal.

    Jean F. Crombois EU Member States EU-Russia Foreign Policy

    Jean F. Crombois

    Lilliput Effect Revisited: Small States and EU Foreign Policy

    Blog

    30 Jul 2020

  • Though the coronavirus is still on our radars, countries have been gradually easing lockdown all over Europe and getting back to work, even going on holidays, and reuniting with their families.

    In the Martens Centre, we want to hear from our like-minded partners all across the continent as we launch #Back2EU, a video series to present our member foundations network, how their respective countries lived through the pandemic, and how they are coping with the easing of lockdowns.

    Anna van Oeveren EU Member States

    Back2EU – Teaser

    Multimedia - Other videos

    30 Jul 2020

  • For policymakers and politicians, it’s easy to discount the millennial generation as lazy, footloose and obsessed with social media. In Italy, a whole generation are now derided as bamboccioni (big babies) who prefer to lounge at home with their aged parents, rather than embrace a more financially independent lifestyle. But such easy stereotypes belie a much harsher economic reality. And nowhere is this despondent realism more evident than in an Italy seemingly on the verge of perpetual economic and societal collapse.

    Italian millennials (those born between 1981 and 1996) have confronted the 2008 financial crisis and the ongoing Corona crisis. But even these crises are mere bookmarks in the longer story of Italian economic fragmentation which began with the recession of the early 1990s. This is a stagnation which has already resulted in a whole generation of young Italians being without steady employment, bereft of economic independence and increasingly without hope for the future. 

    This millennial disenfranchisement has caused frustration, distrust of government and a tendency to vote for populist parties. This is a society where young women are still exposed to the ridiculously discriminatory and illegal ‘dimissioni in bianco’ (blank resignation) letter which allows employers to dismiss workers on account of any future pregnancy or marriage. An economy where the richest 1% of Italian adults increased their share of total personal wealth from 17% to 24% in the two decades up to 2016 notwithstanding a stagnating economy.

    Although Italian millennials are more educated and skilled than their parents, two out three workers with a short-term contract are under forty. As a result, young Italian adults are poorer than the previous generation. A 2018 study showed that Italians in their thirties earn 17% less than their parents did at the same age. This had led to reluctance to start a family (Italy has one of Europe’s lowest birth rates) and a gradual decline in the size of the traditional middle class.

    Closing this dichotomy – between the struggling younger generations and their often affluent parents and grandparents – is the biggest obstacle to fundamentally rebooting Italy’s economy.

    But to give millennials a fighting chance at success means confronting two bedrocks of Italian society: an antiquated education system and a reorientation of political power away from well-heeled middle-aged and retired Italians.

    The Italian education system is exacerbating millennial struggles. Highly theoretical and based on the acquisition of general background knowledge but few practical skills, the Italian teaching system at the post-primary level is not attuned to the realities of the 21st-century labour market. The results are either abstract or controversial. Italy (the third largest economy in the EU) has no university in the top 100 globally. This compares to eight from Germany and seven from the Netherlands.

    Closing this dichotomy – between the struggling younger generations and their often affluent parents and grandparents – is the biggest obstacle to fundamentally rebooting Italy’s economy.

    Perhaps even more importantly, giving young Italians a fair opportunity at economic independence requires challenging the stranglehold on policymaking held by older Italians. Italy has become the Florida of Europe with the conservative (and often regressive) economic policies to match. The oldest population in the EU (22% of Italians are aged over 65) benefit disproportionally from a welfare system designed to protect their interests over all else.

    Over 77% of public social spending in Italy goes to retired people while only 3% of total expenditure is targeted on working families and children. Remarkably, Italian retirees enjoy the highest net pension replacement rates in the EU (nearly 92%) notwithstanding Italy having the largest public debt in Europe.

    It’s a retirement heaven for older Italians. But it’s deliberating sabotaging the prospects of millennials. It is also – very obviously – totally economically unsustainable.

    A country famous for putting family at the heart of society is in fact dressing up this wealth grab as a continuation of traditional norms. Witness the mass hysteria when former Prime Minister Mario Monti attempted to reform the unaffordable public pension system in 2011. The reforms were subsequently rolled back and the Italian retirement gravy train (just like Snowpiercer) is still speeding around and around the tracks.

    So what can Italian millennials do?

    The first thing is to realise that neither a naive EU nor its much-heralded Economic Recovery Plan will save Italy. Such initiatives will only facilitate existing Italian policymakers clinging to power while the money flows from Brussels. Tens of billions of euros of investment in combatting climate change and digitalisation, while very welcome, will change nothing if more deep-seated structural reforms are ignored.

    Second, Italian millennials should refuse to accept the current status quo as the only available path for Italy. This will mean confronting the older generations (including parents and grandparents) about the illogicality of such generational inequality. It means the young need to inject a sense of urgency and positive disruption into their approach to mainstream politics. It’s time for a productive movement of change that is not just the same old negative messaging stuck on repeat.  For all the noise they generate groupings like the Movimento delle Sardine (Sardines Movement) are devoid of tangible reform proposals.

    Italy needs a generational awakening dedicated solely to pursuing the interests (and rights) of young Italians. Unburdened by history and unfettered by the conservatism of wealth preservation, this movement should work towards fundamental economic and social reform by working for young Italians across the political spectrum. Only then will Italian millennials have a fighting chance.

    Existing politicians are incapable of reforming Italy because that would mean compromising their own tightly held privileges. That’s why only its ‘big babies” can save Italy now.

    Eoin Drea Alessia Setti Economy Education EU Member States Growth Leadership

    Eoin Drea

    Alessia Setti

    Only its ‘big babies’ can save Italy now

    Blog

    20 Jul 2020

  • This policy brief analyses the competences and potential of the EU in the field of cultural heritage protection. Despite numerous references to culture and heritage in the EU treaties, the analysis suggests that the Union’s focus on cultural heritage remains limited and does not adequately reflect the magnitude of recent challenges.

    In the last decade of financial and economic difficulties, Europe’s cultural heritage has suffered from major funding cuts. This is now being compounded by the devastating consequences of the COVID-19 pandemic on the culture and heritage sectors. Climate change also represents a growing threat to cultural sites across the EU, and the successes of right-wing Eurosceptic populism have changed the politics of cultural heritage. The EU is routinely portrayed as a remote post-national technocracy bent on overcoming separate national identities and lacking a commitment to the continent’s common historical heritage.

    This paper argues that all these developments have created the conditions for considerable ‘European added value’—economic, social and political—to be realised by stepping up EU action for the protection of the continent’s cultural heritage. Currently ongoing negotiations for the next EU Multiannual Financial Framework (MFF 2021–7) and for the post-COVID-19 recovery fund that is tied to it (the ‘Next Generation EU’ initiative) offer a unique opportunity to advance this important agenda.

    Economy EU Member States European Union Values

    A Europe That Protects Its Heritage

    Policy Briefs

    15 Jul 2020

  • With over 51% of the vote, the incumbent Andrzej Duda of the ruling Law and Justice (PiS) party has won the presidential election against Rafał Trzaskowski from the Civic Platform (PO). This is a narrow victory, but the country’s descent into authoritarianism will continue nonetheless. This result will be taken as a sign of encouragement by all autocrats in Europe. But they shouldn’t rejoice too soon. A closer look at the result, and especially at the dynamics of recent weeks, reveals some cracks in their narrative.

    1. These elections were free, but not fair

    This contest was David against Goliath. Andrzej Duda not only had at his disposal the government (very important during the pandemic), but also state media. During the pandemic, he could de facto campaign while exercising his office, travelling around the country, whereas opposition candidates were literally confined to social media for much of the campaign. What is more, Polish public media, especially television, overtly and consistently endorsed his campaign. True, most governments – in Poland and other formerly communist countries in the last 30 years – have ensured that public media were rather government-friendly. But that is nothing compared to the relentless transformation of Polish public TV into an Orwellian propaganda instrument for PiS since 2015. Another example of the unequal playing field was the deliberately bureaucratic and inefficient treatment of expatriate voters by consulates in those countries where past elections had been unfavourable for PiS.

    2. Rafał Trzaskowski has put himself and his party firmly back on Europe’s political map

    Rafał Trzaskowski will now return to his post as Mayor of Warsaw. But he has left his mark, and sooner or later, will return to national and European politics. Among younger voters, and in medium-sized and larger cities, he clearly beat Andrzej Duda. Two months ago, when PO decided to change their candidate and nominate Trzaskowski, no one would have predicted that he could come even close to half of the electorate. Between the first and the second round, he gained an additional 18 percentage points, meaning he swept up practically the entire left-wing vote, and most of those voters who rejected both him and Duda two weeks ago because they both represented the establishment. Against such overwhelming odds, Trzaskowski, in a breathtaking impromptu campaign, inspired and mobilised half of the electorate in Central Europe’s biggest nation.

    3. The authoritarian narrative about East and West in Europe is a myth

    Europe’s autocrats like to state that not only are Central European societies more socially conservative (which is true to an extent), but also have fundamentally different approaches to liberal democracy, to the rule of law, and checks and balances. Rafał Trzaskowski received almost half of the votes, mainly because so many Poles were fed up with the way PiS has usurped the Polish state, the judiciary, and the public media. Equally aggravating is the party’s use of hatred and bigotry in its treatment of the opposition, and how its actions have isolated Poland in Europe. The culture war narrative about a wealthy, liberal, decadent, overbearing, and Soros-controlled West that wants to lecture a young, dynamically growing, and conservative East about the rule of law has been proven wrong in this election. The insistence of EU institutions, such as the Parliament, the Commission, and the majority of EU Council members on the rule of law is not Western arrogance. It is the insistence on implementing what every country signed up for upon accession to the Union – in terms of values, but also in terms of procedures to safeguard them. To present this effort as a West European or Brussels-based politicised witch-hunt against conservative governments is a distortion that has been exposed by this Polish election.

    The immediate future for Poland is predictable: PiS will expand its control over the judiciary, go after private media and push out foreign owners, and curtail local and regional governments’ power. The European People’s Party should raise its voice against such efforts to destroy liberal democracy, no matter which member state they are taking place in. It should expose authoritarian narratives no matter who voices them. And, as importantly, it should recognise who its real future talents are.

    Roland Freudenstein Democracy Elections EU Member States European People's Party

    Roland Freudenstein

    Poland: A hollow victory for authoritarianism

    Blog

    14 Jul 2020

  • The travel industry is one of the economic sectors most harshly affected by the Coronavirus epidemic. Airline companies are facing the worst challenge in decades by cutting costs and laying off employees, fighting to survive another day.

    National airline companies have now become a significant challenge for EU member states. Airline companies do not only employ large amounts of people; they are part of the core transport system of each EU member state, and often potent national symbols. Should national airline companies collapse, national governments would have to foot the bill.

    Therefore, the European Commission’s announcement on 2 July, launching an infringement procedure against ten EU member states in breach of the bloc’s passenger rights rule was met with discontent in some EU capitals.

    In many EU member states, the view is that passenger rights should be temporarily suspended. Lobbied by airline companies, twelve EU countries have demanded the suspension of passenger rights. In practice, this would mean if a flight is cancelled, instead of immediate reimbursement (for which the delay is currently one week), passengers would be offered a voucher instead. The member states’ letter proposes ‘a clear right of reimbursement immediately at the end of validity’. The short-term implications of this are unclear, but if the voucher’s validity is 2 years, the consumer could wait for their money a long time.

    The problem is that as the airlines are fighting for survival, and enjoy the moral backing of the member states, questionable tactics are already being used. After the EU has already helped airline companies by waiving the obligation to use 80% of their take-off and landing slots, airline companies across the board have begun cancelling flights last minute. This has obviously caused a big headache or two for airline customers.

    For airlines, the logic seems to be to ensure that flights are full and profitable. Unfortunately, some airlines are currently selling tickets for routes which they know full well the flight will probably be cancelled.

    The business logic is that through these unfair tactics, companies can improve their immediate cash situation by reimbursing customers with several months’ delay. Additionally, certain clients will end up returning the money to airline companies through vouchers, because airlines do not inform travellers about reimbursement options, or often make the reimbursement process so complicated that customers give up and accept the voucher right away.

    Fool me once, fool me twice…

    Of course, one can argue that it is in the customers’ interest for airline companies to survive, and the current climate is very tough for airlines. But misled customers should not be the ones paying the industry’s bill.

    As things stand today, the situation for us, as airline customers, is radically different. When buying a flight ticket, one has to take into account that the risk of flight’s cancellation has increased substantially. Secondly, one is better off buying a ticket from a company which you plan to fly with in the near future so the voucher is of some use, in case the flight is cancelled. Finally, remember that obtaining reimbursement for your ticket might be a lot of work, and you would be waiting a long time for compensation.

    By using deceptive tactics with customers, airlines are adding rapidly declining consumer trust to their long list of problems, the most obvious of which is a drop in demand for flights as a result of the Coronavirus epidemic.

    Once this trust is damaged, it will take a long time to regain it. The EU’s infringement procedure is not only protecting European customers, it is also protecting the flight industry by maintaining consumer trust. After all, the airline industry can only thrive with happy and confident travellers.

    Credits: Photo by Skitterphoto on Pixabay

    Tomi Huhtanen Crisis Economy EU Member States European Union

    Tomi Huhtanen

    Travelling in times of Corona: how the EU is preventing a long-term aviation’s crisis and saving our summer holidays

    Blog

    10 Jul 2020

  • As the debate on European sovereignty has gained traction in recent years, Europe’s centre-right should develop its own distinct vision of European sovereignty, one that reflects its own priorities and values.

    This policy brief aims to develop a tentative theoretical and historical framework that can be used to work out what this conservative and Christian Democratic vision could look like. It argues that it is important for the centre-right to ensure that its vision stands apart from those of both the nationalist populists on its right and social-liberals on its left. Against populists the centre-right needs to show that conservatism and European integration can be compatible. As the historical overview in the paper shows, conservatives throughout history have supported processes of political and economic centralisation as long as these have taken place in piecemeal fashion and the resulting institutions have reproduced in their conduct and outlook the values conservatives stand for. Against the centralisers on the centre-left, who are currently monopolising the slogan ‘more Europe’, the centre-right must articulate more clearly how its own understanding of EU integration is a more pragmatic, effective and viable way forward. Contrary to progressives, who view European and international institutions as instruments of ideologically-driven social change, European conservatives see institutions as expressions and safeguards both of diversity inside the EU and of the distinctly European imprint on world politics externally.

    The paper offers a first outline of how a conservative perspective on EU sovereignty could be applied to a range of policy areas, from foreign policy to economic governance to migration.

    Centre-Right EU Institutions EU Member States Integration

    Towards a Sovereign Europe – A Centre-Right Approach

    Policy Briefs

    09 Jul 2020

  • Will populism turn out to be one of the ‘victims’ of the COVID-19 pandemic, as many commentators have claimed?

    Angelos Chryssogelos, Assistant Professor in Politics and International Relations, London Metropolitan University:

    “I don’t think the question of populism should be treated in binary terms, i.e. will it go up or down after the crisis. The pandemic will be bad for certain populists while providing opportunities for others. We need only think back ten years to the Great Recession: the economic crisis boosted left-wing populism – up until then a marginal force – in countries like Spain and Greece, while established populist parties like the FN in France failed to capitalise on it. It now appears that the pandemic will be bad for some populists like Trump while others, like Erdoğan in Turkey and PiS in Poland, may overcome it. I think that Europe dodged a major bullet with the Five Star Movement in Italy. The pandemic crisis would be an ideal event for a non-ideological populist party dominated by conspiracy theorists, anti-vaxxers, and generally unstable characters. Luckily, the 5SM is in government during this crisis, so it no longer has the credibility to express these feelings. Nevertheless, I think this provides a blueprint for anti-establishment politics in an era when vaccines and tracing apps will be major policy issues, and I expect this will be replicated elsewhere. Unfortunately, this brand of populism is much more dangerous and corrosive than the typical populist radical right, who at least has a core of identifiable ideological beliefs that make it more predictable and conventional.”

    Dalibor Roháč, Resident Scholar, American Enterprise Institute:

    “So far, I have seen little evidence of that. In fact, there are reasons to believe that the crisis might end up strengthening populist, anti-establishment forces. The mechanisms for this are manifold. Firstly, given the inherent uncertainty about the virus, especially at the early stages of the pandemic, public health officials and experts were inevitably making mistakes. The seasonal flu is more dangerous than COVID-19, we were told. In America, President Trump’s ban on travel from China (which included a variety of loopholes) was decried as fomenting Sinophobia. Experts initially advised against wearing facemasks. Worse yet, while many of these judgement errors were made in good faith, some seem correlated with political ideology, such as the muted reaction of experts to the wave of Black Lives Matter protests, which swept across the Western world. Secondly, we have yet to assess the magnitude of the economic fallout from the lockdowns –past experience suggests that support for populism rises in periods of financial distress. Moreover, the costs of lockdown might very well affect people unevenly. Individuals in ‘elite’, high-education occupations might be in a better position to work from home for extended periods of time than those in blue-collar professions. The combination of perceptions of the inadequate, self-serving expert class, and the uneven material impact of the pandemic, makes for a potentially toxic political mix.”

    What are the stakes of the extraordinary European Council called on 17-18 July from the point of view of the EU’s political legitimacy? In what ways will its results (or lack thereof) matter?

    Angelos Chryssogelos: “How many ‘make-or-break’ European Councils have there been in the last decade? I’m sure they number in the dozens at this point. I’ve long been sceptical that any singular EU decision truly affects the long-term legitimacy or sustainability of the European project. As the economic and refugee crisis demonstrated, national political elites (because this is what we ultimately mean when we say ‘the EU’) are very much interlocked together as they navigate major policy crises on the one hand, and restive public opinions on the other. The setting of EU institutions provides them with opportunities to blow steam through the theatricality of ‘tough negotiations’, while finding ways to tame the effects of crises that no country on its own could cope with. If no solution is found in one Council, then you quite simply move on to the next one. In this sense, preoccupation with high-minded ideas, like the ‘legitimacy of the European project’ is both unnecessary and counterproductive. Should polls be accurate, and the majority of European citizens are indeed unconcerned about the EU either way, why elevate it to a major stake of European politics? Succeeding in taming the pandemic crisis’ economic effects will not vindicate an abstract ‘Europe’, any more than failure to come to an agreement in the July Council will prove that European integration has been a failure. If a deal is found in July for the recovery fund, great. If not, move on to the next meeting. The show will go on either way.”

    Dalibor Roháč: “The EU’s political legitimacy does not stand and fall with one summit. However, the gravity of this moment cannot be underestimated, as the pandemic has hit European economies at a time when many were already carrying a large debt overhang. Unless mitigated through action at the EU level, the solvency of some member states would be threatened. Fundamentally, the principles underpinning the single market themselves would be in danger. With the relaxation of state aid rules, some countries are in a much better position to help domestic businesses that find themselves in distress. The crisis could thus leave Europe with a dramatically uneven playing field. The longer the implementation of the recovery package takes, the greater the risks. At a basic level, the summit is therefore a test of whether European leaders are genuinely committed to the European project. To be sure, bargaining and seeking the best deal for voters in their respective countries is expected. The final product will necessarily be a compromise, ridden with imperfections. But the question is whether European leaders will be able to rise above the more parochial questions of who gets how much and with what strings attached, and to approach the exercise as one that will set a precedent for years to come.”

    Crisis EU Institutions EU Member States Euroscepticism

    How is the COVID-19 crisis affecting EU legitimacy?

    Other News

    08 Jul 2020

  • Without a doubt, 2020 will be a year the world will remember. So will Andrej Plenković. Croatia’s Prime Minister just got re-elected and secured 66 parliamentary seats for his conservative HDZ party, in a surprising outcome to the election. Moreover, this historical win comes only five days after the European Union’s youngest member state passed the Council leadership baton to Germany, not to mention the ongoing fierce pandemic, which Plenković’s government had to combat in its own backyard and on the European level.

    Ambitious priorities based on the slogan “A Strong Europe in a world of challenges” had to be reconsidered during the Croatian EU Presidency. Andrej Plenković’s government had to react quickly in order to adapt to conditions brought on by COVID-19.

    Firstly, high-level meetings in Croatia and Brussels were replaced by video-conferences, and cultural events, geared towards serving the nation’s branding purposes, had to be adapted for social media promotion. 

    Secondly, relating to the allocation of the EU budget, Plenković’s government intended to shape the final draft of the Multiannual Financial Framework (MFF) in order to serve all EU 27. At the same time, it advocated for additional funds for Cohesion Policy and the Common Agricultural Policy, two items which the current MFF draft proposes to reduce. Due to the pandemic and short timeframe, when the conversation shifted towards money, an agreement was reached on an EU Recovery and Resilience Facility worth €560 billion, and three safety nets, including €540 billion in loans in response to the coronavirus’ consequences.

    Thirdly, one of the central aspects of the Croatian Presidency was enlargement policy, and the Presidency’s commitment to opening negotiations with Albania and North Macedonia, which culminated in the EU-Western Balkans Summit. The Zagreb Summit was the crowning achievement of the Croatian Presidency. In March, EU Heads of State not only gave their green light for the opening of negotiations with Albania and North Macedonia, but they also sent a clear political signal to the region and emphasised its importance for Europe. Although the summit’s initial aim was to address the rule of law and the fight against organised crime, it focused on the coronavirus and €3.3 billion in financial assistance that the EU pledged to the Western Balkans region to help it recover from the pandemic.

    If Member States were to be given marks at the end of each six-month EU Presidency, the criterion for assessment could be the fulfilment of the tasks set out in the Presidency programme, in coherence with the EU agenda. Despite the very ambitious programme and the government’s thorough preparation, not all the objectives set out could be achieved due to the previously mentioned conditions. However, according to Charles Darwin, it is not the strongest that survive, but those most adaptable to changes. And Croatia deserves a petica (meaning an excellent mark) in that regard, because not only did the country adapt well to unforeseen circumstances, but it simultaneously sent out a message of solidarity, unity, and a bright vision of a stronger EU.

    Simultaneously, Andrej Plenković had to fight battles on home court. During a full-blown crisis, he had to reappoint a new health minister, which proved to be one of the key moves for the upcoming elections. Croatia’s National Civil Protection Headquarters, composed of Health minister Vili Beroš and Interior minister Davor Božinović, are perceived as superheroes, who put feelings of trust and safety in the minds of Croats when they needed it the most. It was precisely the term ‘safety’ that was the motto of Plenkovic’s campaign #SigurnaHrvatska, which motivated voters to elect a party that can lead them to brighter days, come hell or high water.

    Even though this was the third time in the past 14 months that Croats went to the polls, and while previous results did not play out well for HDZ, Andrej Plenković took the correct conclusions out of earlier mistakes, choosing the right time and the right people. His newly composed electoral list left nothing to be desired. A balance of experienced politicians with a dash of competent and promising youth, running an election called immediately after a very successful management of the pandemic, and before the incoming economic downturn, was the magic formula. Croats had their say, and they voted for a safe, proven, and ambitious option.

    Nevertheless, there are still five more months until the end of the year, and there are already new problems on the horizon. According to experts, the upcoming economic crisis should hit harder than in 2008. This threat, paired with coronavirus, climate change, existing migration challenges, and growing populism, will cause a lot of sleepless nights in Zagreb.

    Sandra Pasarić Elections EU Member States European People's Party European Union

    Sandra Pasarić

    Finding security in uncertain times: A ‘petica’ for Andrej Plenković

    Blog

    07 Jul 2020

  • Unless you live in Malta, you might not have noticed an unprecedented search and rescue crisis that has revolved around this island nation since April of this year. What in normal circumstances would have occupied headlines across Europe, has nearly been driven into the background by the dramatic events surrounding the COVID-19 pandemic both in Europe and globally.

    This crisis has been spurred by a progressive increase in illegal border crossings from Libya towards Malta and Italy. In turn, this increase is a result of at least two factors. The first is mass joblessness among Libya’s large migrant population, caused by an economic decline due to the COVID-19 pandemic and the ongoing conflict inside the country. The second is a resumption of the activities of migrant smugglers, tolerated by the officially recognised Government of National Accord (GNA). The health crisis has confirmed Libya as the main North African country serving as a departure point for Europebound irregular migrants.

    The pandemic and its consequences for irregular migration are highlighting the challenge that Libya, as a relatively wealthy but dangerous and conflict-ridden country, continues to pose to European politicians 

    Crisis EU Member States European Union Migration

    COVID-19 and the Old-New Politics of Irregular Migration from Libya

    IN BRIEF

    02 Jul 2020

  • The article examines the immigration and integration policies of France, Sweden, Germany and Denmark. It argues that there is a need for a more unified understanding of the concept of integration throughout the member states. Although European law does not regulate the issue of immigrant integration as it is a competence of the member states, there is a need for a unified understanding of integration. Denmark’s integration policy is described as an example of an effective policy that ought to be emulated, in contrast to those of other countries. The article concludes that the problems France, Sweden and Germany face in integrating newcomers are partly due to a lack of consensus about what integration ought to be.

    Read the full article of the June 2020 issue of the European View, the Martens Centre policy journal.

    Claudia Cajvan EU Member States European Union Integration Migration

    Claudia Cajvan

    Lessons From Migrant Integration Into European Societies

    Blog

    30 Jun 2020

  • EU leaders seem to have agreed, at least in principle, that an ambitious recovery plan financed by EU bonds should be introduced and that the EU should have more competencies in the area of health care. Do you think the COVID-19 crisis is rekindling some federalist ambitions in the EU?

    Lawrence Gonzi, Former Prime Minister of Malta:

    “Rather than European federalism, I prefer to look at this as a question of European solidarity in practice. It is the realisation that we are all in this together, and we can only get out of it together. The recovery plan is welcomed – it is the response to calls for Europe to do whatever it takes. There are issues being negotiated that still need to be defined, so while this is welcome in principle, we have to ensure that all Member States’ red lines on taxation and competitiveness, for example, are respected. But even with these outstanding issues, Europe is in a strong position, and there is a clear path for this recovery package to move forward. This is a unique opportunity to revitalise Europe’s economy, making it fairer, greener, and more sustainable for all of us. We should not waste it.”

    Andrius Kubilius, Former Prime Minister of Lithuania:

    “If by federalist ambition, we understand that some new European-wide instruments were created to fight the crisis, then we need to agree that since the Treaty of Rome, each crisis was pushing the European Community towards federalist ambition. Yet this is exactly what Jean Monet predicted: ‘Europe will be forged in crises, and will be the sum of the solutions adopted for those crises’.”

    Herman Van Rompuy, President Emeritus of the European Council, Former Prime Minister of Belgium:

    “I myself was not a big fan of the original plans for a Conference on the Future of Europe. I am in favour of it now, because this crisis has shown to citizens that ‘more Europe’ is needed. They found it strange that there were different kinds of politics in the Union regarding the virus, and they found it strange that borders were being closed and opened in a selective and dispersed manner. Many wondered where Europe was. They were unaware that the EU simply did not have competence for health. Europe is not a super-state! It also becomes clear that the EU is very dependent on medical supplies from abroad, especially China. We are already dependent on non-Europeans for digital platforms, energy, defence, and poorly protected external borders. Will we also be externally dependent for food tomorrow? The theme of European sovereignty has been raised; the conference could focus on this, instead of yet another institutional discussion that actually plays into the hands of anti-European forces. If one starts from the needs of the people, one can come up with pro-European decisions. The conference should not only question citizens, but there should also be leadership by formulating proposals and testing them with the public – a combination of top-down and bottom-up.”

    Wolfgang Schüssel, Former Chancellor of Austria:

    “The EU budget for the next seven years needs sufficient resources. The United Kingdom, an important contributor, has left. New challenges, like the prevention of pandemics, President von der Leyen’s ‘Green Deal’, the necessary protection of external borders, and funding an emerging common defence policy, underline the necessity for novel own resources for the Union. Let us add the intended recovery plan after the Corona crisis – and in this context, an open discussion without taboos about the size, use, control, and a repayment plan of such a huge programme is necessary. This may not be a federalist ambition but a better equilibrium of European and national competences.”

    Foreign policy and defence are essential areas for the EU’s future. Would you agree that the European Council should take decisions on the common EU foreign and security policy by majority vote and not by consensus? And do you see PESCO as the main instrument to move forward and strengthen the EU’s weight in the field of defence?

    Lawrence Gonzi: “On the issue of common defence, I think our strength comes from our collective action and common purpose. On the one hand, having consensus on these sensitive issues lends legitimacy to the process and ensures that no Member State feels railroaded into a decision that it is not comfortable with on a sensitive issue. On the other hand, consensus means that their discussions take longer, and we are less flexible in how the Union reacts. On balance, my preference is to retain consensus in defence matters. That means more work for our negotiators and more need for States to compromise – but that is the only way all our citizens will feel involved in the process.”

    Andrius Kubilius: “I agree that Foreign Policy and Defence in the EU are critically important policies. In my view, Foreign and Defence Policies in the EU should not be the only ones decided by majority voting. Other policies should be included, because that is the only way to make the EU truly democratic and effective. PESCO is an important instrument, but more importantly, the EU needs to have a clear strategy on security and defence issues – determining where the EU is going to rely on its ‘strategic autonomy’, and where it will rely on NATO (or US) capabilities.”

    Herman Van Rompuy: “Of course, I am in favour of more possibilities for qualified majority voting. It should also be discussed in the Conference on the Future of Europe. To make the idea more acceptable, one could imagine a softer formula in which the opposition of a minimal number of countries cannot block a decision. This could have avoided the recent problems in the Council. With regard to PESCO: we must make a success of this first in order to envisage the next step. The final objective must be a genuine military dimension of the Union.”

    Wolfgang Schüssel: “The European Union should extend Qualified Majority Voting (QMV) procedures to foreign policy areas. In the future, sensitive decisions regarding China’s policy and ambitions, but also Israel’s prospective annexation plans of the West Bank, will require clear EU statements. Defence policy is probably too underdeveloped for QMV voting and needs, for the foreseeable future, consensual decisions.”

    Despite initial success in 2014, the Spitzenkandidaten procedure to elect the Commission President failed in 2019. How can it be reformed? And what other measures could help bring the EU closer to citizens?

    Lawrence Gonzi: “I am a fan of the Spitzenkandidaten process, and I think it is a pity that it was not fully respected in 2019 – but I do not think that it is dead in the water. I would move to codify the process and therefore give increased legitimacy and certainty to the European Commission President and the entire image of our European Union.”

    Andrius Kubilius: “In an effort to bring the EU closer to its citizens, the role of the European Parliament should be strengthened with the power to initiate legislation, the power of parliamentary oversight of the executive branch, and the power of non-confidence towards individual Commissioners. This would make the entire EU architecture more democratic. The Spitzenkandidaten system was designed to make the whole process less dependent on a consensus in the Council. There are also other ways to overcome this problem: for example, deciding by majority vote in the Council when making a decision on the candidate for Commission President.”

    Herman Van Rompuy: “I’ve never been a supporter of the Spitzenkandidaten procedure. It hasn’t brought the Union any closer to its citizens, and instead organised a pointless power struggle between the EU institutions. I would invest much more energy into the idea of a European constituency. Unfortunately, that concept quickly found its way into the inter-party political battle. It deserves a second chance.”

    Wolfgang Schüssel: “The text of the treaty is quite clear: the European Council makes a proposal, taking into account the results of the EP Election, followed by an affirmative EP vote, which is necessary. Politicising and personalising the election, and as a result the European Commission, is, in my opinion, a disputable option. It is better to put the substance of European policy at the core of the election and the alternative party programs.”

    Crisis Defence EU Institutions EU Member States

    How will the Corona crisis shape the future of Europe?

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    25 Jun 2020

  • For as long as the EU has had a China policy to speak of, it has been ambiguous. The EU’s most recent China strategy calls the country “a partner, a competitor, and a systemic rival.” Europeans understand the challenge posed by Chinese mercantilism and its ambitions for continental hegemony. Even before the pandemic, most Europeans held an unfavourable view of China, with 70 percent of Swedes and 57 percent of Czechs seeing the country in a negative light. However, devising a coherent approach has proven difficult.

    One reason is that even among the more ‘hawkish’ countries, there is not necessarily an understanding of what an effective European response should resemble. For France, Chinese mercantilism is best confronted by mercantilism of a European variety: building European champions and tossing aside competition and state rules. But that is a no-go for governments of smaller countries wary of China – say, Sweden – who nevertheless understand that European monopolies showered with public funds are a costly and ineffective response to the challenge at hand.

    Another reason is a persistent distrust of US President Donald Trump. Joining forces with the United States is a losing political proposition as long as America is seen as erratic, mercurial, and primarily concerned with its own bilateral trade deficit, instead of the broader economic and geopolitical challenges that China’s rise involves.

    Yet, the current triangulation between Beijing and Washington often requires a denial of reality. At his recent press conference, the High Representative Josep Borrell claimed that Chinese leadership “do not have military ambitions and they do not want to use force and participate in military conflicts”, notwithstanding China’s recent grab of Indian territory and the militarisation of the South China Sea. Whom does one believe: Mr Borrell or one’s lying eyes?

    The EU’s ambiguity has also provided a permission structure for member states to strike deals with China, which will harm the continent’s interests over the long term. Examples include Italy’s embrace of the Belt and Road initiative – or, more recently, the rushed and secretive decision by the Hungarian government to proceed with the construction of a Chinese-financed rail connection with Belgrade.

    Finally, the lack of a principled China policy erodes the EU’s status as a champion of human rights and democracy around the world – a mantle which Europeans have been keen to carry in the era of ‘America First’. After years of pussyfooting around the status of Taiwan, Tibet, or the regime’s appalling treatment of the Uighur minority, the milquetoast criticism of China over its crackdown on Hong Kong is a case in point. An unambiguous violation of a commitment that was thought to carry the full force of international law requires more than “grave concern” and to “raise the issue in our continuing dialogue with China”, as Mr Borrell’s office put it.

    With its heavy-handed ‘public diplomacy’ response to the COVID-19 pandemic, Beijing has squandered a lot of goodwill in Europe. “We should not shy away from naming and shaming” said Věra Jourová, the European Commission’s vice-president, regarding China’s disinformation efforts in the wake of the pandemic. Ms Jourová’s home country, Czechia, saw the Chinese regime seek to co-opt political and business elites for years, inviting a broad-based backlash after it overplayed its hand.

    The current situation is Europe’s opportunity to rethink and step up. The simultaneous invocation of ‘partnership’, ‘competition’, and ‘systemic rivalry’ in the EU’s relationship with China is not sustainable. Partnership presupposes trust and the existence of common goals. Competitors have different interests but adhere to shared rules of the game. Conversely, a ‘systemic rival’, as the Greens’ MEP Reinhard Bütikofer correctly put it, “just wants to win.”

    Nobody expects the EU to embark on a Trump-led China crusade or to ‘decouple’ itself from Chinese trade and investment flows. Yet, clear guidance for member states on Chinese investment in critical sectors, whether they be infrastructure, finance, or tech, would be helpful. Similarly, a commitment to exclude Huawei from 5G networks across the bloc and joining the UK’s bourgeoning initiative to get the world’s leading democracies to cooperate on technological alternatives to Huawei are worthwhile endeavours.

    The EU ought to be ready to walk away from the mirage of an investment treaty with China, currently in its 30th negotiating round. The EU wants China to scrap quantitative restrictions, equity caps, and joint venture requirements currently imposed on European companies. Also, EU businesses ought to be able to “compete on an equal footing when operating in China” by achieving “non-discriminatory treatment, prohibition of performance requirements – in other words, measures requiring investors to behave in a certain way or to achieve certain outcomes (including those leading to forced technology transfer) – and equal participation in standard-setting work.”

    Unfortunately, those practices are central to China’s state capitalism. The absence of noticeable progress since the decision was taken to start negotiations in 2012 shows that no matter how hard the EU presses for “full reciprocity”, a non-discriminatory business environment in China is not on the table. Meanwhile, Beijing is eager to turn Western economies into its playground. After all, only 15 per cent of Chinese corporations listed on the Fortune Global 500 are in private hands.

    European discussions over China would be much easier if the United States today were a trusted and reliable partner, providing strategic guidance, instead of the current administration’s petty displays of hostility towards the EU. The nature of China’s challenge to Europe, however, remains unchanged, regardless of who the current occupant of the White House is. Thus, it is imperative that Europeans use the window of opportunity provided by the pandemic and Beijing’s overreach to step up, hopefully to be joined in their efforts by the United States.

    Credits: Photo by Peggy_Marco on Pixabay

    Dalibor Roháč Crisis EU Member States European Union Foreign Policy

    Dalibor Roháč

    In the wake of COVID-19, the EU must do better to address China’s rise

    Blog

    18 Jun 2020

  • This paper discusses an idea to create a European Legion that has been put forward by Radoslaw Sikorski, MEP. This would be a new kind of EU military unit, made up of volunteers rather than national contingents contributed by the member states. The idea stems from Sikorski’s desire to reform the EU’s existing battlegroups, which have been operational for 15 years but have never been used, despite numerous opportunities. The paper argues that although the EU’s 2007 Lisbon Treaty imposes heavy restrictions on the Union’s ability to deploy military force, it does not rule out conducting operations with a volunteer force. At the same time, a volunteer-based European Legion force would have to be created initially by a group of member states outside the EU framework. These states could then make it available to the EU’s Common Security and Defence Policy as, for example, a permanent battlegroup. An existing model would be the multinational Eurocorps.

    Crisis Defence EU Institutions EU Member States

    Rethinking EU Crisis Management – From Battlegroups to a European Legion?

    Policy Briefs

    16 Jun 2020

  • The article describes the socio-demographic situation of Western Pomerania following Poland’s accession to the EU in 2004. Western Pomerania faced a number of challenges: a brain drain, a rapidly ageing society and a shortage of workers. The region’s demographic situation was particularly serious compared to Poland’s other regions. However, Western Pomerania is now profiting from an inflow of migrants, especially from Ukraine, which is boosting the region’s economy. The article describes the measures undertaken on the local and regional level to promote the inflow of economic migrants and to integrate them into the local society. The measures described are helping to form a broader regional strategy to tackle the challenges of people leaving the region, the ageing population and a departing workforce. The article argues that if the proper support for newcomers is provided, migration could become a positive factor for the local economy.

    Read the full article of the June 2020 issue of the European View, the Martens Centre policy journal.

    Olgierd Geblewicz EU Institutions EU Member States Integration Migration

    Olgierd Geblewicz

    Western Pomeranian Experiences with Migration and Emigration: The Need for Local Solutions

    Blog

    15 Jun 2020

  • Migration is a major issue, not only for Europe but for the whole world, and it will remain so for years to come. It is a phenomenon caused by a number of factors and one that is beyond the capacities of a single state to tackle. Rather it requires solidarity and joint efforts to handle it. This article focuses on the migration/refugee issue in Europe, particularly from the perspective of Greece. It provides an overview of the efforts of Greece and the EU to address the challenge of irregular migration and the flow of refugees in the Eastern Mediterranean.

    Read the full article of the June 2020 issue of the European View, the Martens Centre policy journal.

    Giorgos Koumoutsakos EU Institutions EU Member States Migration

    Giorgos Koumoutsakos

    Migration: A European Question in Need of Urgent Answers

    Blog

    04 Jun 2020

  • How should the migration issue be tackled from an institutional perspective? The issue of immigration represents a common, communitarian challenge, not only a challenge for particular countries. This means that the answers to this challenge must be found together, at the European level, through close cooperation between the member states and the EU institutions. Management of immigration should be organised at the European level, by the EU institutions and the member states working together. This applies to border control, the repatriation of those not granted asylum or a residence permit, and also to cooperation with third countries on migration issues.

    Read the full Editorial of the June 2020 issue of the European View, the Martens Centre policy journal.

    Mikuláš Dzurinda EU Institutions EU Member States Immigration Migration

    Mikuláš Dzurinda

    New Perspectives on Migration Policies

    Blog

    25 May 2020

  • Today with a very special guest: Rafał Trzaskowski, Mayor of Warsaw. He discussed political issues concerning Poland and the EU.

    Rafał Trzaskowski Roland Freudenstein Eastern Europe EU Member States

    The Week in 7 Questions with Rafał Trzaskowski

    Multimedia - The Week in 7 Questions

    08 May 2020

  • During the last decade or so, the European Union has been spared little in the way of dramatic crises: the biggest financial meltdown since the Great Depression, the largest refugees’ inflow since the massive population transfers that concluded WWII, and now the deadliest epidemic in over a century. In conjunction with each of them, a reasonable case could be made, and has been made, that the best solution was a ‘federal’ EU state responsible for, respectively, fiscal and economic policy, migration policy, and now health policy. 

    COVID-19 Crisis EU Institutions EU Member States Resources

    Does the EU have sufficient healthcare competences to cope with COVID-19?

    IN BRIEF

    28 Apr 2020

  • Watch Jan Techau answering 7 questions about Germany, Angela Merkel, France, the EU, UK, Russia, China, COVID-10, and even Super Heroes!

    Roland Freudenstein Brexit China COVID-19 EU Member States EU-Russia

    The Week In 7 Questions with Jan Techau

    Multimedia - The Week in 7 Questions

    17 Apr 2020

  • A podcast series that aims to challenge commonly held assumptions about the European project in a tour de force through European history, culture and civilisation. Podcast host Federico Ottavio Reho redefines political correctness with the help of razor-sharp arguments and beautifully drawn historical parallels.

    Federico Ottavio Reho Christian Democracy Democracy EU Member States EU-Russia EU-US European Union

    [Europe Out Loud] “The light that failed?” a chat with Ivan Krastev

    Europe out Loud - Multimedia

    10 Apr 2020

  • Governments across Europe are implementing border closures, travel restrictions, and heightened screening at their borders. How useful are these measures in countering the spread of the Coronavirus?

    Rainer Münz, Migration and Demography expert, formerly working at the In-House Think Tank of the European Commission (2015-2020):

    “All these measures are definitely useful in reducing the risk of COVID-19 contagion, as is the case with any other epidemics. It is clear that infected business and leisure travellers have brought the virus from China to Europe and North America. The same is true inside Europe. Many people got infected after coming back from trips to Italy, western Austria, and a few other ‘hotspots’. Such closures even make sense within countries.”

    Jean-Louis De Brouwer, Director of Justice and Home Affairs, Social Policies and Sustainable Development, Egmont (Royal Institute for International Affairs):

    “Some have expressed the view that a mere closure which is not complemented by a strong programme of testing and tracking would be useless. Others have stressed that it was all the more senseless, as these decisions were often taken at a time when the virus was already inside the country. Not being an epidemiologist, I will refrain from engaging in this debate. But I would support the views expressed by Migration Policy Institute experts in a recent policy brief: while stressing that COVID-19 was not a migration problem, they acknowledged that “closing borders to non-essential travel might be a logical extension of asking people to stay home.”

    Carlos Coelho, Founder of the Schengen Observatory, former MEP: 

    “A general or targeted ban on travelling would help contain the spread of the virus. In contrast, the reintroduction of internal border controls is not necessarily useful in containing the spread of COVID-19. Why? Their implementation – particularly along land borders – is hardly possible: 1. The member states do not have enough human resources to conduct effective controls. 2. Controlling the green parts of the borders (outside the official border crossing points) is impossible. 3. A traveller might not show the symptoms and already carry the virus. Thus, the imposition of quarantines to travellers would be an effective measure. In addition, there are side effects to these controls, clearly affecting the free movement of goods overland. This is particularly worrisome for medical equipment and supplies, pharmaceutical products but also perishable goods such as vegetables and fruit.”

    It seems that only some member governments of the Schengen Area notified the European Commission of the impending reintroductions of border checks. Is this a problem?

    Münz: “Governments are working in an emergency mode. It might be that not all procedures foreseen by the Schengen regulations have been followed, but the Commission does not seem to have major objections (for now) as long as the flow of goods is ensured. We also should not forget that earlier border controls imposed by countries such as Austria, Denmark, Sweden, Germany, and France as a reaction to the inflow of refugees and irregular migrants in 2016 had still been in place when current measures were taken.”

    De Brouwer: “Yes, absolutely. Controlling access to its territory might be deemed as a fundamental prerogative of a Westphalian sovereign state. However, adherence to the Schengen Area of free circulation means accepting new rules and adopting new behaviours building upon transparency and mutual trust and translating these into permanent coordination. That is why the Commission rightly reacted by presenting its generally welcome ‘Guidelines for border management measures to protect health and ensure the availability of goods and essential services’ on 16 March 2020. As the reintroduction of border controls and travel restrictions are indeed compatible with the Schengen ‘acquis’ under certain conditions, it was essential to implement them in a coordinated way while preserving the internal market.”

    Coelho: “Not necessarily. Border check notifications are lodged for three main reasons: 1. Guaranteeing publicity and transparency. 2. Allowing ex-post verification on proportionality and the necessity of national border controls by the European Commission (complemented by a report of the member states once the controls end). 3. Ensuring and encouraging coordination between the member state imposing the controls and those member states that are affected. Whereas the present controls are widely publicised, and the current situation falls within the circumstances foreseen by the Schengen Borders Code, it is not so clear that coordination has occurred. Not notifying the Commission might thus indicate a bigger problem: a lack of coordination between member states. Polish controls and their effect on the citizens of the Baltic countries serve as an important example. On the other hand, it will be essential to see whether or not the national controls produced the results desired and if they were effectively implemented. Notifications would provide relevant information to the Commission for this assessment.”

    On 16 March, all Schengen Area member states approved the European Commission’s proposal to impose a 30-day restriction on non-essential travel to the EU, thus creating a Schengen Area ‘security perimeter’.  What are the chances that this measure will lead to the easing of border checks inside the Schengen Area?

    Münz: “The issue is not so much ‘checks’, but the denial of access. This is an additional measure attempting to reduce contagion, and it will not affect travel restrictions. Both measures will – sooner or later – be lifted hand-in-hand.”

    De Brouwer: “This is the bet of the Commission, which, in its communication of 16 March states that ‘such a measure would also enable the lifting of internal control measures.’ However, the joint statement adopted by the members of the European Council on 26 March reflects a somewhat different understanding: heads of state and governments commit to ensuring smooth border management where temporary internal controls have been introduced, without actually questioning them. On a related subject, one should also bear in mind the negative consequences such restrictions could have on the respect of international protection obligations. Although the Commission explicitly stresses that such a measure should not apply to persons in need of international protection, or for other humanitarian reasons, the situations at the borders between Greece and Turkey or between Croatia and Bosnia deserve our utmost attention. By the way, this issue is not unique to Europe; it also arises between the US and Mexico.”

    Coelho: “None. Recent experience shows – notably with the so-called refugee crisis – that reinforcement of the protection of our external borders has not resulted in the lifting of the internal controls. Nor has it led to a change in the political debate. Moreover, even though this pandemic is provoking symmetrical effects across the union, the spread of the virus varies across the EU.”

    COVID-19 Crisis EU Member States European Union

    What are the effects of the national border closures on containing the COVID-19 infection?

    Other News

    08 Apr 2020

  • The COVID-19 outbreak, and its deep financial aftermath, will put the European Union under unprecedented stress over the next five years or more. Brexit will add to these tensions for some members, notably Ireland. It is a matter of vital national interest for Ireland, that the EU gets its response to the crisis right, and does not allow it to create dangerous social distancing between the states of the EU.

    The existing structure of the EU is unfitted to a crisis like this. The public expects the EU to act, but has not been given the EU the powers it needs to do so. Unlike the states of the EU, the EU itself has no capacity to borrow money, and no capacity to raise taxation. So it often lacks the financial clout to take decisive action. The amount it is allowed to spend is a mere 1% of GDP, whereas EU member states can and do spend around 40% of their GDP.

    The countries and regions that gain most from the EU Single Market, are either unaware of the gains, or mistakenly think it is all due to their own efforts. A recent study by the Bertelsmann Foundation showed that the big objectors to Eurobonds (Germany, Austria and the Netherlands) gain almost three times as much per capita from the EU Single Market as do the assumed beneficiaries of the Eurobonds, Spain and Italy!

    If the Single Market were to fail, the objectors would lose the most. But their national politicians fail to tell them this. Incidentally, the study showed Ireland to be a big gainer from the Single Market.

    Meanwhile, the countries and regions that gain comparatively less from the Single Market resent this, and fail to acknowledge that they too are gaining from being in the EU Single Market, albeit a bit less than the others are gaining. Envy blinds some to reality.

    Of course, these contradictory feelings are rarely expressed publicly, but they are there under the surface, ready to emerge when a crisis happens and decisions have to be made quickly.

    COVID-19 has been such a crisis.

    The restrictions on economic activity, as well as the direct health and income support costs, arising from COVID-19 will dramatically increase the debts of all states in the EU. At the same time, the initial reactions in some member states – from Germany blocking sales of vital equipment to Austria closing its border – have left bitter feelings in Southern member states, especially Italy.

    Assuming a 20% drop in GDP as a result of COVID-19, an economist in the Bruegel Institute in Brussels has estimated that the Debt/GDP ratio of Italy could rise from 136% of GDP to 189%, that of France from 99% to 147%, that of Spain from 97% to 139%, and that of Germany from 59% to 94%.

    As all these countries can expect their workforces to decrease in the next 20 years, because of past low birth rates, this is a very troubling prospect. A way needs to be found to spread the debt as widely as possible and as far as possible into the future.

    The EU faces an unprecedented situation which justifies unprecedented actions.

    One of the proposals made to do this is Eurobonds/Coronabonds which would enable countries to borrow with a guarantee from all eurozone states. The interest rate might be lower but it is still just another form of borrowing. If Italy issued a Eurobond, it would still be increasing its overall debt, and might face a higher interest rate on its ordinary bond issues. Another objection is that it might take 18 months or more to get these Eurobonds up and running, and the markets need something quicker.

    Another proposal, favoured by some Northern member states,  is that distressed countries borrow from the European Stability Mechanism (ESM). Some believe that the ESM is too small for all that needs to be done. Others worry about the conditions that might be imposed.

    Meanwhile, the European Central Bank (ECB) continues to buy the bonds of member states. For example, it owns 26% of all German government bonds and 22% of all Spain’s bonds. This bond buying by the ECB enables governments to continue borrowing, but its support is confined to members who are in the euro. It is using monetary policy to achieve the goals of fiscal policy, which is controversial.

    I suggest that a better solution would be to allow the European Union itself to borrow, up to a limit of (say) 0.5% of the EU GDP, to spend exclusively on COVID-19 related expenditures.

    Article 122 of the Treaty already makes provision for the EU to give aid to help states suffering from “natural disasters and exceptional occurrences” beyond the control of a member state or states. COVID-19 meets this criterion.

    But the EU is not using this power, because its budget is fully committed to other things. It has no room to respond to sudden emergencies. It would have such room if it was allowed to borrow. This power could then be activated to allow direct transfers of funds to a state in acute distress because of COVID-19 or the like, without adding to the recipient state’s debt. 

    Doing this would require an amendment to Article 310 (1) of the Treaty. This article presently requires the EU always to run a balanced budget. This could be amended to allow borrowing that was confined to spending on matters, like COVID-19,  that had arisen suddenly and were beyond the control of the state looking for help. Such a limited borrowing authority would command a lot of support from the electorate.

    It would also be borrowing under the democratic control by the Council of Ministers and  European Parliament, something that does not apply to bond buying by the ECB.

    The EU faces an unprecedented situation which justifies unprecedented actions.

    John Bruton Brexit COVID-19 Crisis Economy EU Institutions EU Member States

    John Bruton

    Increasing our firepower: Where can the EU find the ammunition to fight a Coronavirus induced economic slump?

    Blog

    07 Apr 2020

  • The pandemic that has now affected billions, forcing nearly half the world’s population into some form of lockdown, is far from over. In fact, infectious disease experts warn that the majority of countries grappling with the virus have not yet reached their respective apex. For the European Union, this means that thousands more will fall ill; supplies of ventilators, masks and other personal protective equipment, as well as hospital beds, will increasingly become scarce; businesses will continue to suffer or face bankruptcy and economic output will stagnate, with a Eurozone (and global) recession all but guaranteed.

    As such, this is not only the problem of any one, or a few, EU member states. It is a uniquely European problem, that only a European solution can effectively solve.

    In the EU, knee-jerk reactions like the closure of internal borders, and the initial freezes on national exports of protective medical equipment and testing kits — later rectified by the Commission — run contrary to our European way of life, making them appear particularly abrasive and extraordinary.

    There have also been numerous examples of member states donating medical supplies to other members who need them more urgently, with some even welcoming cross-border corona patients to their hospitals. But, as noble and heart-warming as these instances of EU solidarity are, alone, they are not enough.

    The EU has been far too divided in its response, to its own detriment. A remedy to a crisis of this magnitude (455,901 cases in the EU/EEA and UK at the time of writing) must be proportional, uniquely European, centralised at EU-level, and better communicated to the general public. It must present “EU solidarity” not merely as a platitude, but as a resounding, undeniable fact.

    The EU is a coalition of 27 member states that agree to work intimately with one another for benefits they could not otherwise obtain alone. If the EU wants to pass the post-stress test that will inevitably follow this pandemic, and the inescapably intertwined questions of legitimacy, it must start acting like its future depends on it. After all, that is exactly what is at stake.

    There have been numerous attempts, and there will be many more temptations, to close off our open societies and revert back to mere nation states. Some measures are indeed vital to contain the spread of the virus, such as internal border closures, but the EU must take coordinated action to counter potential consequences, like threats to food security.

    Although the Commission has already taken necessary action to address some of these concerns, like the implementation of “green lanes” throughout the EU, more oversight will be needed to ensure the flow of goods goes unhindered. For instance, it should also lead a coordinated effort to oversee and expedite the distribution of medical equipment from members where production is concentrated, namely the Czech Republic, France, Germany, and Poland, to members in dire need.

    This is not only the problem of any one, or a few, EU member states. It is a uniquely European problem, that only a European solution can effectively solve. 

    The EU must also continue to pass swift, sweeping emergency measures to support the hardest-hit member states. The Commission-proposed EU Solidarity Fund is a good start, but it is only a temporary lifeline.

    The next major hurdle for the EU is the negotiation of a more long-term, far-reaching, joint fiscal package to address the wider economic repercussions caused by the virus. Herein lies the most significant bottleneck for the EU’s COVID-19 response to date, one for which the von der Leyen Commission, as well as the Council, must find a way to overcome. If the already-tainted idea of ‘corona bonds’ does not receive the traction necessary to make it a viable option, then emergency crisis meetings must be held with more frequency in order to expedite alternatives, like the pan-European unemployment reinsurance scheme.

    There is one more area, however, where the EU, and the Commission in particular, needs to improve: communication. Rather than highlighting instances of EU solidarity via the actions of individual member states, the EU’s communication strategy should be centralised as well, involving joint press conferences between the heads of the Commission, Council and Parliament, at least once per week. In addition to presenting the latest trends and figures, the EU should use such an occasion to better communicate the co-ordinated efforts that it is spearheading, which to date are largely flying under the radar.

    Furthermore, information on the Commission’s webpage documenting the assistance provided by the EU to the member states (and among member states) should be more easily accessible, streamlined, and categorised by country.

    This pandemic is a defining moment for the European Union. It has the opportunity to prove its potential and demonstrate that it can overcome a threat of such magnitude, together, by navigating the crisis as a union. Failure to respond in a unified manner could de-rail the progression of the European project for decades to come, or deliver a blow to its legitimacy from which it may never recover.

    On the other hand, if the EU effectively demonstrates the benefits of a more coordinated, federal-like response, it could leave the doorway open to further integration and centralised autonomy – from finance to security – to better prepare and respond to crises of similar proportion in the future.

    Before we rid ourselves of this virus in Europe, and on a global scale, things will get worse before they get better, but we are all in this together. Instances of EU solidarity, alone, will not be enough to overcome this crisis. However, if the Commission and the other Institutions step up their role as the central nerve system of the EU, facilitating a more centralised, unified, and better-communicated response to Europeans, we may even emerge as a stronger Union.

    After all, the coronavirus knows no boundaries, why should our response?

    Gavin Synnott COVID-19 Crisis EU Institutions EU Member States Leadership

    Gavin Synnott

    COVID-19 in Europe demands a centralised European response

    Blog

    03 Apr 2020

  • The outcome of the Slovak parliamentary election held one month ago resonated with the mood of Slovak society, which clamoured for a change. Election winner Igor Matovič and his party OĽANO, (Ordinary People and Independent Personalities) was the only opposition party to have tapped into that emotion. With a pledge to rid the state of the mafia, it sent into opposition corrupt socialists after they had spent almost twelve years in power. The election also brought other surprises, such as the failure of the ambitious conservative-liberal alliance Progressive Slovakia and SPOLU (Together) to obtain seats in parliament or yet another failed parliamentary attempt by the Christian Democrats. Still, there was no space for their political analyses. Winners and losers alike lacked time to process emotions brought up by the election results.

    This lack of time was due to the COVID-19 pandemic, which also resulted in the appointment of the government in the record time of three weeks. The new government took over the reins with a collapsing healthcare system and with no reserves of medical supplies. With its slightly more than 400 infected patients to date, Slovakia belongs to the less affected countries. This may be due to insufficient testing capabilities as well as the timely introduction of strict measures and a disciplined population. What played its part in this regard was not only a health concern, but also a particular legacy of communist times. Back then, civil defence drills to prepare for enemy attacks and donning oxygen masks were a normal part of life.

    The fragility of the new coalition

    Igor Matovič, a seasoned political marketer with a propensity for populism and an admirer of Orbán’s national referendums, undoubtedly had a different idea about taking over the reins of power. Even under standard circumstances, his coalition consisting of parties with diverging views about relations with the EU, and also regarding fundamental ethical issues, would draw bets on how long it would survive. OL’ANO is hardly a normal political party and is run by Matovič like a company. His theatrical manner of appearance, egocentrism and tendency to shoot from the hip has earned him the reputation of a dangerous manipulator, not only in the media. 

    A security risk exists with the second strongest party, Sme Rodina (We Are Family). Its chairman, who has a history of mafia contacts and money laundering, is currently the speaker of parliament. The party is a member of the same political group in the European Parliament as Marine Le Pen and Matteo Salvini.

    The third member of the coalition is the SaS (Freedom and Solidarity), with its chairman Richard Sulík advocating the return of EU governance to the state level. In 2012, his party did not approve the European Stability Mechanism in a vote serving as a proxy for expressing confidence in the government. This resulted in the demise of the pro-reform government and the comeback of the socialists. Ironically, this time, Sulík as the newly appointed minister for the economy, will call on the help of the ESM to bail out entrepreneurs who are in danger of going bankrupt.

    The Za ľudí party (For the People), was also made part of the coalition mainly to obtain the constitutional majority. Its chairman ex-president Andrej Kiska gave up his mandate on the grounds of health making its further crystallization or European profiling remain unclear.

    The campaign is over, leadership is needed

    Faced with the pressure of the predicted broad spread of the virus, the extraordinary government sessions take place on a daily basis. The biggest car manufacturers shut their factories two weeks ago. Every day brings new self-employed entrepreneurs unable not only to pay their bills, but even to provide for the basic living necessities of their families.

    However, the adoption of relevant measures will have to be intensified even further. The media note that Prime Minister Matovič has not yet been able to switch from a campaigning mode to assuming an executive position, as he spends much of his time speaking to the cameras rather than sitting at the negotiating table. Considerable criticism has also been raised by the newly adopted “lex corona” legislation, which allows monitoring people infected with the virus via mobile operators. Let’s hope that such information will not be misused and that Slovakia will not follow the path of Hungary, which restricted democratic freedoms, allegedly in the name of the fight against the virus.

    Despite the internal ideological discrepancies, the new Slovak government enjoys considerable support from Slovak society. This is also a consequence of the fact that the opposition is being represented by corrupt socialists and neo-Nazis, who are just waiting for the first faulty step of the current government.

    The opportunity is there for Igor Matovič himself to prove, through extensive engagement, cooperation and supporting solidarity within the EU, that his election was the right choice for Slovakia. He has a tremendous opportunity to not become another Beppe Grillo, but a statesman who will lead the country out of this crisis.

    Viktória Jančošeková COVID-19 Crisis Democracy EU Member States

    Viktória Jančošeková

    Slovakia and the Pandemic: Never let a crisis go to waste

    Blog

    02 Apr 2020

  • Coronavirus disease 2019 (Covid-19) is spreading quickly in European countries, with the situation being most advanced – and worrying – in Italy. Many aspects of the disease are still unknown. How many people in Europe are currently infected and how many will be in the future? What percentage of the infected will need hospital care? How many of the infected will die from the disease?

    As answers to these questions are still unknown, there are strikingly different scenarios presented by the main health institutes of the different EU member states. These different scenarios present end results where the final estimation of the infected and deceased can be different by a factor of ten or more.

    As a result, there seem to be two different strategic approaches: one is to say that our main aim is to ‘flatten the curve’, aiming to reduce the speed of the spread of the virus by social distancing so it will not overwhelm the healthcare system and, in the most extreme cases, hospital care can be offered. This strategic thinking is most clearly currently expressed in the Netherlands, the United Kingdom and in countries where the disease has not yet spread severely.

    The argument is that stopping society altogether for months is not feasible, and when society would become active again, the disease would start to spread anyway – thus again a new lock-down would be needed.

    The other approach is to try to contain the spread of the virus as soon as possible. This is what China and other Asian countries have chosen as a strategy, this is what the World Health Organization (WHO) is recommending and clearly what Italy is opting for now.

    During the epidemic, there has been a question over how much European health care systems can handle. Before we had some data from China, but as the situation in Italy is evolving, we are having a more detailed and reliable picture. The following conclusion is emerging: If we just try to decrease the speed of the virus’ spread, our health care systems will be overwhelmed. Many more people will require hospital care (read: potential lives saved) than what health care systems can offer. The bottleneck is found at the number of hospital beds, respiratory aids, oxygen pumps, and trained health care professionals. Italy is a concrete example of that reality.

    Italy’s case has been painted as an exception, because the virus most probably spread there unnoticed for weeks. But what is often forgotten is that even if the (speculative) real amount of infected in Italy is around 300,000 people, a number way higher than any Italian official has estimated, it would still be only 0,5% of the whole population.

    If the disease is allowed to impact the whole society, the mainstream speculative estimations of the percentage of the population infected vary from 30% to Angela Merkel’s maximum 70% in Germany. In Italy, the current estimate of 0,5% of the population to 30% is a long way to go, with the current volume of patients multiplied by 60 even within a longer period of time. Additionally, solely considering average national numbers is misleading, as there are regions where the disease is and will be more intense.

    If Covid-19 is allowed to affect the whole society, even at a slower pace, the European health care systems will not be able to take care of all the patients needing care and thousands of people will die. The numbers will be just too big, just flattening the curve will not work out.

    If European states want to save lives, they need to embrace now the measures taken by the Italian government in those countries where it has not yet been done: to implement confinement. This approach will have a strong negative impact on society, but so does the death of thousands of people just because of a lack of hospital care. In the upcoming weeks, the focus needs to be total in combating the virus. Passively by staying home as much as possible, and actively by urgently increasing the number of hospital beds, respiratory aids, and training of the temporary health care professionals.

    Northern Italy’s health care system is one of the best in Europe. Hard-hit Bergamo’s main hospital let a camera crew in for the rest of Europe to know what an overwhelmed healthcare system looks like. For Italy today, the strategy is very clear: to stop the virus whatever the cost. Other European countries still have one to a few weeks before the situation will reach the same stage as in Italy. They should use them wisely.

    Credits: Photo by Anastasiia Chepinska on Unsplash

    Tomi Huhtanen COVID-19 Crisis EU Member States Society

    Tomi Huhtanen

    Italy’s lesson for Europe: Flattening the curve isn’t enough, we must actively tame the Covid-19 epidemic

    Blog

    23 Mar 2020

  • Empty supermarkets, sold out face masks, and the prices of hand sanitiser reaching absurd heights; this is the picture that has been portrayed of Italy in the past weeks. As of 10th March, 9,175 people in Italy have contracted COVID-19 (a.k.a. the Coronavirus) with the majority of cases concentrated in the North of the country.

    After closing schools, universities, museums and cancelling public events (even sacred Serie A football games), the government took even stricter measures by issuing a decree during the night of the 7th of March. This measure ordered the isolation of the region of Lombardy and 14 provinces in Emilia-Romagna, Veneto and Piedmont. The decree prohibited all circulation in and out of the “red zones” with only partial exemptions granted for emergencies or work.  It also involved closing all schools and universities. These measures are in place until 3rd April. During a press conference on the evening of 9th March, the Italian government extended the restrictive measures to all regions. In effect, placing Italy on total lockdown.

    The reason behind such a drastic decision of the government, besides obviously containing the spread of the virus, is to prevent contagion to the southern regions of Italy. The Italian healthcare system, based on universal access, has been put under immense pressure with more and more patients contracting the disease. The mortality rate among infected people is not extremely high and the average age of the deceased is 81, however, a continuously increasing number of people require intensive care. Having a huge wave of contagion in regions like Apulia, Campania or Sicily,  may actually lead to the collapse of already weak southern healthcare facilities should the virus continue to spread.

    But the impact on the population’s health, or on normal social interactions, are not the only impacts of COVID-19 on Italy. The repercussions on the already fragile economy of the country will be massive. The shutdown of Lombardy, accounting alone for 46% of foreign investments into Italy, will have significant economic repercussions for the Italian economy.  Repercussions that are now impacting on every region in Italy.

    Although the Italian government has already announced stimulus measure totalling approximately 4 billion euros these measures will not be enough to counter the longer-term economic impacts.

    Even before the arrival of COVID-19, the Italian economy experienced a significant slowdown in late 2019. In February 2020, the European Commission lowered its forecasts for Italian growth to just 0.3% for the coming year and a budget deficit of approximately 2.2% of GDP.  Events since then – now escalated to an unlimited shutdown of the vast majority of the Italian economy – will result in Italy entering recession in the coming months.  It will also result in a significant deterioration in public finances (both in terms of lower tax incomes and higher health and social security expenditures).

    Although the Italian government has already announced stimulus measure totalling approximately 4 billion euros (or a 0.2% increase in the government deficit) these measures will not be enough to counter the longer-term economic impacts. This is due to three main factors.

    First, the Italian economy – particularly Northern Italy – is embedded in both European and global supply chains. Thus it is doubly exposed both to the ongoing containment situation in China and the coming restriction of Europe’s economy due to the spread of the virus. Second, tourism in Italy accounts for approximately 15% of total employment. As we enter the start of the tourist season it is likely that there will be a dramatic reduction in tourist visits to Italy, at the very least for the next 3-6 months, but possibly longer. The Italian body representing tourism provides estimates that 22 million fewer visitors to Italy will result in an economic cost of 2.7 billion euros. Third, the Italian economy was already stagnating before COVID-19 arrived.  Thus, the depth of the recession will be deeper (and possibly longer) than many now predict.

    COVID-19 should be the starting point for Eurozone 2.0.

    In this context, it is likely that Italy will require additional spending of at least 1 to 1.5% of GDP to effectively counter the recession currently underway. This will not be a situation unique to Italy. For example, the recent mitigation measures announced in Ireland will likely account for at least 0.7% of Irish GDP in the short term.

    Unfortunately, a severe economic slowdown – with severe societal implications – is now underway across Europe. This also implies a significant level of risk for the future stability of the Eurozone. What is clear is that a European approach which prioritises adherence to existing budgetary rules over mitigating the worst impacts of the coming recession will lead to a further deterioration of economic and social conditions.

    What is required now – for Italy, and shortly for the rest of the Eurozone – is an understanding of the exceptional nature of the current circumstances. This should be reflected in the application of highly flexible Eurozone budgetary rules for as long as the crisis lasts. It should also stimulate a renewed push for much more fundamental changes in how the Eurozone is constructed and managed. No more tinkering around the edges, real reform can no longer be subject to political inaction. Completing Banking Union and severing the “doom loop” between governments and banks should now be the top priority. Work should also begin immediately on placing the national capitals back at the centre of the Eurozone family. And that must include greater fiscal flexibility.

    It would be easy now – in a state of societal unease – to resort to classical Brussels based thinking about how the economic impacts of the Coronavirus should lead to more centralisation, more common functions in the Eurozone. That would be a mistake. Italy’s largely unreformed and unbalanced economy is an example of all the imbalances the Eurozone was designed to protect against. COVID-19 should be the starting point for Eurozone 2.0. The only alternative is fragmentation and ultimate collapse.

    Anna Nalyvayko Eoin Drea COVID-19 Crisis Economy EU Member States Society

    Anna Nalyvayko

    Eoin Drea

    Could Coronavirus save Italy and the Eurozone?

    Blog

    20 Mar 2020

  • The European Union is not disintegrating. Some might be tempted to think so given the chaotic European response to COVID-19, the initial lack of coordination and the rapid introduction of border controls between member states. But in cases of national emergency national leaders rightfully tend to the needs of their citizens. This was to be expected as it mirrors our own individual reactions confronted with a sudden shock – irrational behaviour, potential panic and hoarding of supplies. All in all, the situation reflects the true nature of the European Union – a unique international organisation with federalist features but ultimately driven by national capitals and national interest. Many people expect decisive unilateral federal action but they won’t get one, especially in the short term. We will instead see a retreat to national lines, the adoption of drastic measures and then a decisive ‘make or break’ moment for a collective European response. This may be painful to say, but we will have a textbook EU crisis response.

    The European Union does not have exclusive competences to deal with healthcare matters and its role is mostly to coordinate health policies among its members. Additionally, it relies on national capitals for a coherent response in times of emergencies or natural disasters. The EU Civil Protection Mechanism might be pan-European in name but any type of assistance needs to be provided by the individual countries after a national decision. Regrettably, this is why Italy didn’t receive support in the immediate days after the situation got out of hand – the rest of the countries were chaotically wondering how to organise their own limited resources and equipment.

    What the European institutions can do in the short-term is to quickly mobilise available resources at their direct disposal and also facilitate the smooth functioning of the single market. In the last several days the European Commission took a number of important steps to achieve these goals by proposing a reshuffle of billions of euros from the European structural funds in order to provide relief to public budgets. Coherent measures were also announced on relaxing state aid rules and also providing liquidity to small businesses across the continent.

    No man is an island, and no European member state can cope with such a crisis on its own. 

    Most importantly, the Commission started untangling the protectionist knots which several countries started (somewhat understandably) tying due to the emergency in their countries. After the European Commission successfully intervened, medical equipment will not be limited nationally but will be exported throughout the Union. In times of border checks and travel restrictions, the Commission must be on its guard to ensure the free flow of goods and especially the smooth functioning of supply chains which will be vital for citizens, business and industry. Parliament and Council must be on standby to quickly authorise certain acts by the Commission or update relevant legislation where needed. The European Parliament, especially, has a key role in providing due democratic oversight and ensuring the proper communication of the adopted measures with European citizens.

    So far, so good. The Commission will try to be the honest broker between member states which on their side will slowly exhaust their budgets on national measures to contain the virus and also in the attempt to soften the blow for employers, workers and industry. In parallel, emergency or redirected European funding will also prove inefficient if the crisis lasts throughout Spring. The Martens Centre already outlined the major political economy implications of the coronavirus for Europe and the need for flexibility without limits when it comes to ensuring liquidity and adequate fiscal response.

    What comes next? The member states will rightfully focus on preventing contagion and saving lives. However, which European country can individually handle such a shock? China, where the virus started and spread worldwide, registered thousands of deaths, an unprecedented decline of industrial production and a dramatic collapse in car sales, domestic flights, retail and many other economic sectors. The Asian hegemon pumped and redirected a huge chunk of its national resources in order to tackle the crisis. If this terrible outbreak continues throughout the next several months, Europe will be confronted with an economic earthquake which could eventually threaten the Eurozone and the future of the common currency. Some member states will be reluctant to talk about bailouts and mobilising emergency funds but this might prove inevitable.

    No man is an island, and no European member state can cope with such a crisis on its own. We have seen it all and will see it again. European summits will grow long; patience will wear thin. Vows will be broken and new ones will be spoken until the EU muddles through. Successfully.

    The whole European industry will need to readjust and member states will be forced to collectively rethink the functioning of major parts of their economies. Ultimately, this continent will need to find a way to redistribute vast resources quickly and efficiently.

    The European Union will not come out of this crisis as a federation. But this crisis will receive a federal response.

    Dimitar Lilkov COVID-19 Crisis EU Member States European Union

    Dimitar Lilkov

    Muddling through: Towards an EU federal response to the crisis

    Blog

    20 Mar 2020

  • There is no doubt that 2019 was an eventful year which brought us many opportunities, but it was also one filled with challenges and changes. Not only did it deliver the new European Parliament, but it also brought us the new Commission which will be in place for the next five years.

    Centre-Right EU Member States European Union Leadership

    Activity Report 2019

    Activity Report

    06 Mar 2020

  • The Slovak parliamentary election brought a change. A major change.

    The fact that this pivotal change has been at all possible represents the best outcome of this election. It demonstrates a high level of democracy and pluralism in our country. This is no empty phrase or statement of the obvious, especially in the light of developments in some, including European, countries. Fair political competition, free media, active civil society, a record-high turnout of Slovaks working and living abroad, made Slovakia score highly for the quality of its democracy and its level of pluralism.

    The level of pluralism is an extremely important factor in the health of society. It enables the citizens’ active participation in public life and a smooth transition of power between governments with different programmes, leanings or ideologies. Such changes have regularly taken place in Slovakia since the revolution of 1989, and this is good. If pluralism prevailed in, for instance, the Middle East or in several African countries, there would be fewer wars, violence and ultimately, less migration to Europe.

    The new Slovak government will be broad. But the government in 1998 was even broader. Nobody should be a priori excluded. In more than one instance I was reaffirmed in my belief that opportunity creates leaders. Such an opportunity has opened up for the new generation of Slovak politicians. It will not be easy. The parties of the future coalition have raised high expectations. They promised they would replace kleptocracy with Samaritarianism, oligarchy with altruism. We should keep our fingers crossed for them in that ambition. Not forgetting that, in a democratic state, the judiciary is independent of political power. It will thus be important not only to watch the government’s actions, but also to continue maintaining civil society’s attention and pressure on the judiciary so as to prevent it from confusing independence with arbitrariness.

    In this electoral campaign centred on corruption, not much space was given to tackling economic issues. Yet, economic problems are considerable. Slovakia did not make use of its years of good economic performance to create savings, carry out structural reforms, and make improvements in the quality of education, science, and healthcare. After a period of gradually catching up with the most advanced countries, the Slovak economy feels like it is stagnating when compared with the leading European countries.

    The new Slovak government will be broad. But the government in 1998 was even broader. Nobody should be a priori excluded.

    The course towards convergence has halted, the economy lost its momentum, and it is again facing the risk of falling behind. Even though the political parties did not stress these themes in their campaigns, they know all too well that it will be difficult to restart the economy and provide it with new, sustainable and forward-looking incentives. All the more so given that external factors are not as favourable for Slovakia as they were in “our” years.

    New resources are needed for defence and security, environmental protection, new technologies, and for the reform of a heavily indebted Europe, and not least for responding to coronavirus.

    What I missed even more in the campaign was the European context of Slovakia. Looking at Slovakia through the European optics is not a cliché, nostalgia or a customary phrase. The developments in Europe in our nearer or more distant neighbourhood have an increasing impact on us. Greek islands protest against the construction of immigration detention centres, worried Greek inhabitants of Lesbos and other islands are leaving their homes and moving inland. Turkey threatens to open the gates and send new migrants to Europe.

    Looking at what’s happening these days in Syrian Idlib, there will clearly be no shortages of new asylum seekers. And the pressure on Slovakia to contribute to finding a solution will keep growing. Do we have solutions? If so, what are they? Are they solutions that will contribute to forging European unity, or solutions that will contribute to deepening its divisions?

    What I perceive as a great risk for the future government is the attempt to rule by surveys or polls among the citizens. This is nothing new in Europe. Italian comedian Beppe Grillo established his Five Star Movement in 2010. He founded his programme (and largely also his candidate roster) on the Internet and through opinion polls. He wanted to rule based on the wishes of the citizens. When the movement first ran in parliamentary elections in 2013, it ranked second and ended up in opposition. In 2018, running already on the independent ticket, it obtained the highest share of votes – close to 33%. However, in February 2020, after less than two years in government, its poll numbers were down to 14%. And after years of a Five Star Movement government, Italy is not in good shape.

    It is no doubt necessary to know how to listen to people. It is necessary to feel for and empathise with them. But, at the same time, making decisions and taking responsibility for their decisions is not only a privilege, but also the elementary duty of politicians in whom the citizens vested their trust.

    Mikuláš Dzurinda Democracy Elections EU Member States

    Mikuláš Dzurinda

    Slovakia’s bloodless Waterloo: A historic opportunity

    Blog

    06 Mar 2020

  • The Martens Centre was delighted to host Ivan Krastev and MEP Radosław Sikorski in a conversation on the alleged divisions between Eastern and Western member states. Based on the book The Light that Failed, Stephen Holmes and Ivan Krastev argue that the supposed end of history turned out to be only the beginning of an Age of Imitation. The Bulgarian author together with EPP’s MEP Sikorski answered the question why did the West, after winning the Cold War, lose its political balance?

    What do you think? Give us your opinion!

    Mikuláš Dzurinda Roland Freudenstein EU Member States EU-Russia EU-US

    Event ‘The Light that Failed’ in Brussels

    Live-streams - Multimedia

    04 Mar 2020

  • Although the final number of seats obtained by each political party won’t be finalized for several days, the results of the Irish election indicate a marked shift in Ireland’s staid political landscape. Dominated by two centrist political parties since the foundation of the state in 1922 – Fine Gael (EPP) and Fianna Fáil (Renew Europe) – the recent election marks a significant milestone in Irish politics.

    Although Europe was almost entirely absent from the recent campaign, Sinn Féin (GUE/NGL) represents a clear challenge to Ireland’s traditional, pro-European stance at a policy and decision-making level. While Sinn Féin’s historic “anti-Europe” policy has moderated in recent years, this is mostly attributable to very high Irish public support for Brussels and to the EU’s support for Ireland during the Brexit process. However, Sinn Féin remains a deeply Eurosceptic party far removed from positions of influence in the European institutions. After a very disappointing European election campaign in 2019, Sinn Féin retains only one MEP in the European Parliament. Their 2020 election manifesto retains a commitment to “radically reform” the EU.

    The policies of Sinn Féin in power – likely as an equal partner (almost) in coalition with the more centrist Fianna Fáil – sets an uncertain context for Ireland’s future relationship with the EU. In particular, there are three areas – the Eurozone, taxation and trade – where Sinn Féin’s priorities could seriously impact on Ireland’s traditional national consensus (and relationship with Brussels).

    Sinn Féin’s policies regarding the Eurozone are copied from the standard hard left response to the global financial crisis starting in 2008. They are based around vague notions of ending “the Eurozone straitjacket” through flouting European fiscal rules and reforming the European Central Bank. The overall objective appears to be the “direct transfer of newly created money to governments so they can engage in green investment and by quantitative easing for the people”. These proposals highlight a party completely out of touch with both the realities of Brussels based decision making and the operational structure of the Eurozone (not to mention the pro-market economics which underpin it).  They also evidence scant understanding with the complexities of Ireland’s existing public debt and its obligations under existing agreements.

    It is in the areas of the Eurozone and Trade policy that Sinn Féin’s policies have the potential to seriously undermine Ireland’s position in Brussels

    On taxation, Sinn Féin’s positions are more nuanced and not completely out of tune with the Brussels establishment or companies investing (or invested) in Ireland. Although, they call for the continuation of national vetoes on taxation matters in the European Council and the retention of the 12.5% Corporation Tax rate, they support global efforts (presumably at OECD level) to update the global tax system. Sinn Féin wants Ireland to adopt a more transparent approach to dealing with foreign multinationals including ending the appeal against the European Commission’s Apple ruling on alleged unlawful tax arrangements with Ireland. 

    In recent years Sinn Féin’s policies on the Irish economic model (and its attraction of FDI) has moderated considerably. As noted, they now support both national tax vetoes at EU level and Ireland’s present rate of Corporation Tax. Their focus lies more on their traditional wish to create a state agency “to support the growth of indigenous small businesses”. Sinn Féin’s policies, in this area, will continue the longstanding Irish consensus of advocating for national competence on tax matters (including Corporation Tax) while helping to alleviate some EU (predominantly French) concerns regarding the transparency of the Irish tax system.

    On trade, Sinn Féin’s policies conflict directly with both EU objectives and traditional Irish policymaking. Their plan to veto the EU-Canada Comprehensive Economic and Trade Agreement (CETA) follows the example of other hard-left movements throughout Europe. As with their disjointed Eurozone policies, their promise to promote “fair global trade rules and policies” seems to deliberately ignore the fact that the EU has emerged as the global leader in delivering transparent and accountable trade deals since 2014. Sinn Féin’s stance could also prove problematic given the ongoing negotiations between the EU-UK on future trading arrangements given that it’s  Sinn Féin’s raison d’être to achieve a United Ireland.

    This brief analysis highlights that it is in the areas of the Eurozone and Trade policy that Sinn Féin’s policies have the potential to seriously undermine Ireland’s position in Brussels.  However, a number of factors mitigate these dangers.

    First, Sinn Féin will, at best, form just half a coalition government. Its ability to deliver its more extreme policy pledges will be significantly constrained by the political realities. Second, and as noted, Sinn Féin’s overarching objectives are national – namely trying to attain a United Ireland and increasing public involvement in housing to remedy the current domestic crisis – so its primary gaze will be fixed in places other than Brussels.  Third, Ireland remains a very pro-EU country and Sinn Féin understands this explicitly. This limits their potential to adopt anti-Brussels positions consistently. Fourth, the recent example of Syriza in Greece highlights the real constraints imposed on radical left parties that assume political power. The compromise of power will challenge directly Sinn Féin’s mantra of being the radical alternative.

    Eoin Drea Brexit Centre-Right Elections EU Member States Eurozone Trade

    Eoin Drea

    Much ado about nothing? What Sinn Féin in power will mean for Ireland in the EU

    Blog

    11 Feb 2020

  • A decade after the crisis that came close to destroying it, the Eurozone remains fragile. Fiscal indiscipline, a key cause of the crisis, remains a relevant issue. Progress has been made to make the banking system safer, but much more is required to contain risk. Eurozone governance remains weak. This paper argues that six key steps are required to refashion the Eurozone into a robust monetary union capable of dealing with unexpected shocks in the future. These steps are:

    • Subsidiarity should be rigorously applied to straighten the existing muddled governance structures
    • Banking Union needs to be completed to break the doom loop between banks and governments
    • Pan-European banks and fully integrated financial markets offer the best solution to absorb national disturbances. Implicit protectionism – through regulations and support for national champions – should not be accepted
    • The responsibility for fiscal discipline must lie where the budget authority is exercised: at the national level
    • The no-bailout clause is the best protection against fiscal indiscipline. It should be formally restored
    • Some countries with large public debts remain vulnerable to market sentiment fluctuations. However, there are ways to reduce these debts without any transfer or mutual guarantees
    EU Institutions EU Member States Eurozone Macroeconomics

    Creating a decentralised Eurozone

    Future of Europe

    29 Nov 2019

  • What was it that we wanted, what did we long for thirty years ago? What did we declare during the peaceful mass protests in the squares in November 1989?

    First of all, we wanted to trade communist dictatorship and tyranny for freedom. For freedom in the broadest sense. We promised that we would push freedom not only into the political system, not just into the economic and business environment, not just into education and culture, but above all to give freedom to our ideas, plans and visions.

    We also promised to spread love, understanding, mutual respect and decency instead of hatred and intimidation. That we would assign responsibility to freedom. We have learnt a new concept: values. We began to learn to understand this concept, we tried to grasp it and start working on it. Well, we promised to break out of isolation and enter Europe. Physically, politically and culturally. That we were integrating into the Western Community, a group of mutually shared values.

    My view of the present tells me that the basic ideals of November ’89 have been fulfilled. The former post-communist countries are today full-fledged members of NATO and the EU. But, at the same time, it seems to me that there is not a lot to celebrate. It seems to me that even after thirty years of our journey have passed, we are much more divided than united. Why?

    I think it is mainly because we have not grasped freedom for the right end. For many, freedom has become the means of individual promotion at all costs – within the bounds of the law, but without consideration for its authority. Many of us started catching up too fast, regardless of the surroundings and the consequences of our actions. We plunged into the prey that had been hiding from us for more than four decades.

    We began to glorify consumerism, becoming not only individualists but also egoists. We have forgotten values ​​and often also decency. We wanted to open ourselves to the world, but we began to close in our neighbours. Around the lavish dwellings, we began to build our small, stone, individual curtains … and so hatred replaced the envy and frustration of many. The space of freedom has been overrun with too much information, and recently by fake news. On the other hand, political correctness has emerged, often masking a real goal: to maintain or gain power.

    We are already in Europe, but we do not know what to do with it and what to do with us in it. Instead of contributing to solving common problems, we closed ourselves in the jacket of the Visegrad Group, from which we shout almost exclusively “NO“. We have become part of the problems, not the solutions.

    Significant anniversaries are an opportunity for renewing promises. Well, let’s go back to November ’89 as to spring, from which we can draw. Above all, let us make a promise to the strength of the years to come, during which our Western Community, with us in it and with it, must do so much.

    In protecting our security, but also the environment, in reforming our economies and in the Eurozone, in dealing with pressures of migration, but above all – in protecting our shared values. In protecting our ‘way of life’. There is also a duty to help those who still don’t live in freedom and long for their own ‘November’. Whether they are people in or outside our European Neighborhood.

    Finally, complicated our present may seem, it is great that we can live it. It is up to us how we handle it and what tomorrow we prepare for ourselves and for our children. We owe this also to the bravery of the men and women who were able to resist the communist regime and, with belief in liberty, sacrificed their lives. It seems to me that the real importance of November ’89 is to understand that however important historical moments are, our daily commitment and efforts remain crucial. May the message of November ’89 strongly encourage us in that determination.

    Mikuláš Dzurinda Democracy EU Member States

    Mikuláš Dzurinda

    Is this what we wanted in November ’89?

    Blog

    15 Nov 2019

  • We could be heroes just for one day

    Though nothing will keep us together

    We could steal time just for one day

    David Bowie

    “Historic mistake” is the recap of the outcome of the European Council Summit, which didn’t adopt the decision to grant the start of negotiations for EU Accession of North Macedonia and Albania. This news has toppled the hopes of both countries for becoming members of the EU family, at least in the next decade.

    President-elect of the EC, Ursula Von der Leyen, announced that the EU will commit to the Enlargement and integration of the Western Balkan (WB) countries. The failure to adopt a decision on North Macedonia and Albania’s EU aspirations has conveyed a message to the region which has been echoed for a very long time – NOT YET.

    French President Emmanuel Macron has been the main opponent of any further enlargement of the European Union “until the Union itself undergoes a deep reforma new methodology for accession negotiations that would make them less technocratic”. No details for this proposal have been shared. It also remains unclear whether this would apply also to countries which are currently negotiating accession, such as Serbia and Montenegro.

    Another point of disagreement between the EU leaders was the decoupling of North Macedonia and Albania which would grant the start of negotiations only to North Macedonia, as Albania, according to some leaders, was “not there yet”. The French government was not alone in pointing out the enlargement fatigue and the problems with the rule of law in some of the states that joined after 2004 (Poland, Hungary). Also,  France is insisting on a strict application of the criteria for membership during the negotiation and crafting new instruments to better monitor the rule of law.

    In his recent visit to Belgrade, President Macron warned of “rising tension” in the region, referring to Russia’s enhanced presence and aspiration to capitalise on the still unresolved dispute between Serbia and Kosovo. A year ago, he addressed the public in North Macedonia to encourage the voters to have their say in the referendum on the name change, praising the “courage of the leaders and the central position of the Prespa Agreement in the country’s plans for the future”.

    The strong positioning against enlargement in the near future pretty much contradicts this and has been perceived as hypocrisy among the public.

    In the aftermath of the disappointing week, the fear of the consequences of this failure for the two countries, but also for the whole region, is rising. The slammed door by the EU to these countries has been seen as an open invitation for other actors in the East to take advantage and create further instability in the region. It’s neither new nor unknown that Russia, China, Turkey and UAE have laid their hands on the region in various forms to influence the cultural, religious, educational and economic development of these countries.

    Moreover, having no prospects for EU membership is encouraging young people to leave their country to go to Europe as “EU is not coming to them”. With already devastating figures of brain drain in all Balkan countries, the poor economic development, political and social environments and shattered European dreams, the youngest generations are rapidly losing hope that they can also become European citizens.

    Since the Feira summit held in Portugal in 2000, the WB countries have been considered as potential candidates for EU membership. So far, only Montenegro and Serbia have started accession negotiations, in 2012 and 2014, respectively.

    Albania and North Macedonia are expecting to start negotiations (Albania has been a candidate for 5 years and North Macedonia for 14 years!). Bosnia & Herzegovina has not received its candidate status yet. Kosovo is not allowed to apply for membership under Article 49 of the Treaty on the EU, as the state is not recognized by 5 EU member states.

    In the particular case of North Macedonia, it went through an extremely complicated and painful process of reaching a deal with Greece on the name issue, which was also a precondition for its NATO membership. Moreover, after the adoption of the new name into the Constitution with the votes of MPs who received an amnesty for their alleged roles in the violent storming of Macedonian parliament in April 2018, the friendship treaty with Bulgaria, it seemed that the country deserved to be given the green light into their EU aspirations. As a result, many EU leaders expressed their “embarrassment” with the EU failing to fulfil its promises and losing its credibility in the region.

    With the next opportunity for discussions scheduled to take place in Zagreb May 2020, it is yet to be seen if the Council intends to legitimately discuss future steps, or is merely flying a flag of false hope to all candidate countries. The prime minister of North Macedonia, Zoran Zaev, expressing his “disappointment with the unjust decision,” has called for snap elections, which will bring more uncertainty to the future of the governing constellations, and the ensuing reform process.

    The former Minister of Foreign Affairs in the government led by VMRO DPMNE publicly expressed that there are voices inside the party deliberating how to revert the Prespa Agreement if they come into power.

    Embodying the frustration of the country in this seemingly never-ending process, the foreign minister Nikola Dimitrov asked the EU to be straightforward if there is no more European future foreseen for the WB countries, bluntly stating “the citizens deserve to know”.

    And as we know, hope is the last to die. Because it would be a failure of a historic magnitude if the Western Balkan countries, in the eyes of the EU, would turn out to have been heroes just for one day.

    Photo by Oliver Cole on Unsplash

    Katerina Jakimovska Balkans Enlargment EU Member States European Union

    Katerina Jakimovska

    Albania and North Macedonia: heroes just for one day?

    Blog

    21 Oct 2019

  • I say Europe, you say…?

    Democracy.

    What was the biggest myth about the EU that you had to bust during the campaign?

    There are a lot of myths about the EU. I’m a first-time politician, never ran a European campaign, never ran in any campaign. But I am very passionate about people. One of the myths was that if you are not from a political family or with political experience, you would never make it to the European Union. And I am very honoured to be an example that you can kick that myth in the derrière and make a difference.

    You are one of the youngest MEPs in the European Parliament, but it would be interesting to know what your first job was?

    I was 8 or 9 and I used to work in our local market where animals are sold. I used to help farmers load and offload sheep into the trailor. My first paying job was when I was 12, I worked in a local guest hotel, cleaning and serving. This enabled me to build a rapport with different personalities and was fun.

    What was the inspiration behind serving as a member of the Army Reserve in Ireland and volunteering with the Cavalry Corps? What was the most interesting part of that experience?

    This is really important to me. If I could do both, be an MEP and a trooper in the reserves, I would do it happily. I was born American and raised in Ireland, and I always had admiration for our volunteers, as well as towards our fulltime soldiers men and women who put on a uniform and represent our country.

    Now, Ireland is a neutral state and we protect that. But we also have soldiers who are constantly training to protect us in climate issues such as flood relief, or in a bomb squad, special forces, or protecting our dignitaries. Our defence force does a number of jobs even in a neutral state. When I realised I was getting a bit older and if I didn’t go for the reserves when and if I did, it would’ve been one of my greatest regrets. I absolutely adored it. It challenged me, it allowed me to be a better team player and to appreciate my Irish flag much more.

    You mentioned that you spent a part of your life in the United States and I know that you are a member of the delegation for the relations with the United States. What do you think is the future of the transatlantic relationship?

    It is not lost on me that the Commissioner-designate for trade is an Irishman called Phil Hogan, with a breadth of experience, particularly in agriculture. As the European Union, we are constantly negotiating better ways for our citizens and our trade to be protected. And then you asked me earlier, democracy. That is important now in the US more than ever and we need to make sure that our politics and the way our communities are thriving, being built and rebuilt is protected by both sides. There is a lot more to be done and I am excited to sit on that delegation.

    This year we have witnessed the election of the first female Commission president and for the first time, we will have a gender-balanced Commission college. What do you see as the next milestones to further gender balance in Europe?

    When Ursula Von der Leyen spoke in the hemicycle in Strasbourg, I, as a first-time MEP, as a female, as the youngest MEP coming from Ireland – it was remarkable to see history in its making. And I think perhaps it was lost on some, but it wasn’t lost on me.  We need to work better together on the gender pay gap, on gender pension issues, and I would love to see more diversity in the Commissioners college. What do I mean by that? Well, our ethnicity, our cultures, our religions, our orientations, that’s more important, not just gender, because we have a number of words attached to diversity. 

    What are your three favourite Twitter and Instagram accounts?

    This is so hard. I go through a bit of a love-hate relationship with social media. But it’s now more than ever that social media has a great footprint for us on how to translate the information back to our Member States. In terms of politics, I love and I highly recommend people to follow Alexandria Ocasio-Cortez – @RepAOC, a first-time Congresswoman. When it comes to diversity there is The Shona Project @shonadotie and when it comes to mental health it would be Jigsaw Offaly @jigsaw_offaly. You can find them both on Twitter and Instagram.  I am a  big sports fan so @MayoGAA would be a big one to follow from my side.

    You’ve just mentioned mental health and I know that this has been of the topics that you have urged the new Commission to take as a priority. What should we focus on first to address this issue?

    All throughout the campaign, I’ve talked about driving the European year of good mental health. I’m not expecting that to happen tomorrow but within the mandate of 5 years, but I personally want it next year. I want it as quickly as possible. Because I think if we are really looking at trade, as we talked about earlier about the US and China, about trade with our neighbour the UK, we’re actually talking about currency and developing skillsets for our labour market. At the centre of every conversation is mental health. And if we have citizens being mindful of the impact of the positive and negative mental health, then nothing moves.

    Our whole communities break down and it frustrates me that it hasn’t been a competency of the EU yet. But that’s why we have passionate people like you and me here to drive that message. We need to get it into our education programmes and get funding for pilot programmes on mental health resources for both our young and old. Education and up-skilling is a great start for that. But I personally need every Commissioner talking about mental health as if it’s bigger than anything else that they’re going to look at.  Everything is a thread into mental health and we need to secure that.

    Speaking of translating topics to citizens, you are already a sitting member on the Employment and Social Affairs Committee. How do you translate complex topics such as social policies and employments to the voters back home?

    Firstly you have to constantly make sure that you are asking the questions that you think the citizens would like you to ask. It’s important that you dissect that and bring it home. When people think of the EU, they think of European symbols like funding. But the EU means a lot more than that. Over the campaign, I’ve challenged voters, particularly young ones to look for European symbols such as EU supported buildings, universities, and roads. When we look at the visible footprint, not just the financial impact, we begin to understand the pro-European stance better.

    Let’s say that you are playing football. You are the captain of “Team Europe” and it’s the last minute of the game. You have to pick one colleague to make the penalty. Whom do you pick?

    I should wear my country jersey and say that Sean Kelly could kick a good penalty. He was the president of GAA, which is the biggest sports organisation in Ireland, so I would say that he would be pretty dissent in taking a pint or a penalty. I’m going to regret saying this though. Yes, I say Sean Kelly.

    Coming back to your home country, agriculture is a big part of life there and your economy relies heavily on this sector. How do you see the adoption of sustainable agricultural practices?

    Actually, I just came from a call with a young constituent that I have in my area, a man called Kevin Moran who won ‘Young Farm of the Year’ a couple of years ago. He is not only planting trees but he’s also targeting his herd emissions, aiming to be close to 0%  emissions as soon as the next 2-3 years. We need to start listening a little bit more to our younger and older farmers who farm the land.

    All throughout the campaign, I’ve talked about a transition period. We cannot point fingers and say ‘you’re not green enough and this hasn’t happened enough’, but we need to help our citizens along on this transition and it can’t happen too fast because we can’t leave people behind. Our first female Commission President has tasked herself with the Green Deal and all eyes are on that. It’s my job as a new MEP to keep the pressure on my government and to make sure citizens are heard.

    Heels or army boots?

    Army boots.

    Pizza or fries?

    Pizza.

    Hozier or U2?

    Hozier.

    Which EPP colleague would you suggest for the next interview and what would be the question you would ask?

    I would choose Polish MEP Magdalena Adamowicz. She is a phenomenal woman tackling hate speech through her own personal circumstance and also a first-time MEP in the EPP Group. She could kick a good penalty too if needed! My question to her would be: what is the one thing that we could do tomorrow in the EU to reduce hate speech?

    Centre-Right EU Institutions EU Member States European People's Party Leadership

    I say Europe, you say…? Interview with Maria Walsh

    I Say Europe

    10 Oct 2019

  • During the last decade of perma-crisis in Europe, we started to believe in our own impending demise. Suddenly there was money for nothing, China was chomping at our heels and our demographics were catastrophic. All that was left was a long, slow inevitable decline into global insignificance. Fast forward to 2019 and a similar vista appears, this time with the added bonus of catastrophic climate change.  Now Europe teeters on the brink of another economic downturn.

    These challenges, while serious and real, can be addressed by a long-term policy reorientation. But to adequately respond to the issue of climate change and to effectively project European interests on a global stage Europe must combat the one issue which is its biggest impediment. Europe needs to remember that thinking big isn’t a crime. Europe needs to understand that investing for the long term is a vital part of economic planning.

    Take the environment. The airline industry is one of the largest sources of global Co2 emissions. Yet, notwithstanding the relative proximity of many of Europe’s main urban centres, high-speed rail in Europe remains “an ineffective patchwork of lines without a realistic long-term plan”. EU funding of 23.7 billion euro in co-funding for high-speed lines since 2000 is minuscule when compared to support levels for other transport modes. At a European level, the overall picture remains one of isolated national systems and incomplete domestic programmes.

    Yet, the environmental benefits of high-speed rail are obvious. The development of high-speed networks in France, and more recently in Italy and Spain, have significantly reduced domestic air travel and resulted in reliable transport links between many major cities. Cross-border services – most notably the Eurostar connecting London to Paris/Brussels and Thalys linking Paris to Amsterdam (via Brussels) have become important transport arteries.

    So why then the implied reluctance – at both a national and European level – to place high-speed rail at the centre of the EU response to fighting climate change? One reason is the economics of high-speed rail. Such developments are, by their very nature, expensive to construct,  the time taken for such lines to become operational can be substantial (often a decade or more) and during this time they are constantly being subjected to negative media and economic analyses.

    China built a comprehensive high-speed rail network in little more than a decade. 

    Consider both the proposed Lyon-Turin and London-Birmingham (HS2) rail links. The considerable opprobrium heaped on these projects relates mostly to cost. Unrealistic initial budgets (often required to gain political support for commencement) are used by opponents as an economic basis for seeking to halt the project.  But cost-benefit analyses are, by their very nature, only based on a set of quantitative assumptions regarding issues such as construction costs and passenger numbers. 

    The traditional economic analysis ignores wider societal and environmental benefits. In addition, both of these projects also seek to achieve important strategic economic objectives in terms of improving cross border mobility (Lyon-Turin) and tacking increasing regional inequalities (London-Birmingham).

    Often expensive (and they are very expensive) high-speed rail projects find it difficult to attract consistent political support. Welded to an election cycle governments find it difficult to coherently develop plans for high-speed rail lines that may take decades to become fully operational. This equates, in many politicians eyes, to decades of considerable government spending without any discernible impact on their re-election prospects.

    China built a comprehensive high-speed rail network in little more than a decade. In Europe, proposals for new, or even for upgraded lines, can languish for decades in planning hell.

    To counter this reality, the EU should be the perfect mechanism for ensuring consistent financial support for these long term investment projects. The EU should significantly increase co-funding for an earmarked list of strategic priority projects. For example, the approximate 500km distance between Berlin and Munich still takes a minimum of 4 hours to complete by rail.

    Likewise, the 400km trip between Brussels and Frankfurt requires a journey time in excess of 3 hours. These train journey times are not sufficient to alter many passengers travel habits regarding short-hop airline flights. Up to 8-10 flights still leave Brussels for Frankfurt (and vice versa) on a daily basis. 

    Given the current climate crisis, and Europe’s wish to lead the response, this situation is clearly unsustainable. Tackling climate change is a very expensive business. Europe needs to hop aboard this high-speed train before it leaves the station.

    Eoin Drea Economy Energy EU Member States Industry Sustainability

    Eoin Drea

    To tackle climate change Europe needs to embrace high-speed rail

    Blog

    02 Sep 2019

  • The European Liberals and particularly the former head of the ALDE Group in the European Parliament, Guy Verhofstadt, have made their reputation on the criticism of nationalist and populist politicians around Europe, including Salvini, Farage, Orbán and many others. Almost no European-level political party escaped their criticism for democratic backsliding, violation of the principles of the rule of law and other common European values in certain EU member states.

    The truth is that the European Liberals – whose group in the European Parliament now calls itself Renew Europe – have a black sheep in their ranks too. That black sheep is the Czech Prime Minister Andrej Babiš and his ANO party.

    On Sunday, 23 June 2019, Prague saw the biggest public demonstrations since the 1989 Velvet Revolution. The three-hour-long public protest saw more than 250,000 people attend, with many others following online via a live stream. This demonstration was a peak of the gradually growing public dissatisfaction with Prime Minister Babiš and his newly appointed Minister of Justice Marie Benešová.

    The prime minister is accused of data manipulation and essentially stealing two million Euros in EU subsidies in the famous Stork Nest affair, as well as a massive conflict of interest. The new minister of justice was nominated right after the Czech police announced that it had obtained sufficient evidence to submit the criminal case against the prime minister to the court. And already two audit reports by the European Commission have confirmed that.

    Nonetheless, Babiš has refused to step down, and his government survived a vote of non-confidence on 26 June 2019. Nevertheless, the justice minister – despite refusing to step down herself – agreed to negotiate with representatives of civil society about the future reform of the judiciary.

    There is a possibility that the rule of law in Czechia will be severely challenged in the coming months and years, as we have seen in Poland and elsewhere around Europe. The Czech civil society group ‘One Million Moments for Democracy’ responsible for organising the citizen protest is demanding that neither the prosecutor general, nor any other any high-ranking prosecutors be fired at the will of the Minister of Justice.

    The government may still make such moves or try to otherwise block the legal case against the PM.

    Additionally, the legal battle between Andrej Babiš and his Agrofert corporation is going to take place in the upcoming months and the private interests and wealth of the prime minister would  go first at the expense of the Czech citizens. One can expect that with an increase in pressure by the European Commission and European courts Babiš will become increasingly Eurosceptic in return. There will be another heatwave in Czechia in autumn, so it seems.

    Now, how does all of this come together and vis-a-vis the European Liberals?

    Andrej Babiš and his ANO party have been proud members of the ALDE Group in the European Parliament, which is now being reformed and renamed in the new Macronian style. The question is: does Babiš’ movement have a place in such a new group that – at least rhetorically – plans to further federalise the European project?

    ANO, despite continuously defended by the ALDE Group and Guy Verhofstadt himself, clearly violates most of its principles. In fact, ANO in its policies oscillates somewhere between the European Conservatives and Reformists on Eurozone and the Europe of nations concept and Salvini´s party regarding migration.

    Therefore, if the Renew Europe Group was to put its money where its mouth is, it needs to discipline ANO in the same way as the other European families started sorting out their own houses. A criminally-prosecuted prime minister who undermines the rule of law, threatens democratically elected institutions such as the Senate, or flirts with the idea of cutting state support to the Czech civil society organisations would not be a good fellow traveller on the way to a renewed Europe.

    Pavel Havlicek EU Member States Political Parties

    Pavel Havlicek

    The black sheep of the European Liberals

    Blog

    01 Jul 2019

  • 5 things to remember from the last four weeks:

    1. OMG. Turnout increased, for the first time in years, reversing decades of decline. In some member states, like Germany and Poland, the increase in the number of voters going to the polls was spectacular. With more than 50% turnout, the European Parliament elections performed better than the US midterm elections.

    This will certainly give a boost to the legitimacy of the European Parliament, but the effect will be short-lived, as in half a year nobody will talk about it anymore. If you’re not convinced of this, ask yourself: did the low turnout in 2009 affect the European Parliament, except for in the immediate post-election analysis season?

    2. Wow. The opinion polls were right. A Green wave was expected, but only in the North-West of the Union. Similarly, the Liberals grew, but only because of electoral doping, not because of winning the elections: the extra seats won by the LibDems (a temporary effect that will wear off once Brexit has taken place) and the alliance with Macron’s Renaissance.

    Also as predicted, the Grand Coalition of EPP and S&D is not so grand anymore, since it lost its absolute majority for the first time since the direct elections of the Parliament in 1979. But here too there is more continuity than change, as the Grand Coalition already ceased to exist in the second half of the 2014-2019 legislature. Remember that Antonio Tajani was elected President without the support of the S&D Group.

    3. Relax. The populists caused a wave, but not a tidal wave. Matteo Salvini and his friends gained seats but have not been able to put together the 3rd largest EP Group. This is basically because of internal disagreements in the ‘populist’ family and because of the decreased popularity of parties like FPÖ and the Danish People’s Party. In other words: the populists are here to stay, but with winners and losers, like everyone else.

    4. More representative? Seriously? Some claimed the new European Parliament is more representative. Fine, but wait, more representative vis-à-vis what or whom? Thanks to the Green and the populist wave, the new Parliament is certainly differently composed – and much more fragmented – compared with the outgoing Parliament; but that is exactly what elections are for.

    Or are some claiming that the votes in 2014 were not representative? Or that voters in 2014 did not vote for the right parties? If it means that a new parliament is more up to date with the voters’ opinion, then it applies to every election, not only this one, and as such the statement is meaningless.

    5. Stability versus change. During the campaign, but also when the votes are cast and the battle for interpretation starts, some favour stability, while some favour change. Interestingly, on election night EPP Spitzenkandidat Manfred Weber made a plea for stability, stating that now it is not the time for revolution.

    ALDE Spitzenkandidat Margrethe Vestager, by contrast, reminded the audience that as the Commissioner responsible for Competition Policy, she worked to break corporate monopolies, and announced her intention to do the same with political monopolies. Clearly, Vestager wants to oust the EPP from the Commission Presidency.

    PES Spitzenkandidat Frans Timmermans was much more diplomatic – after all, that is his profession. He had probably already foreseen that an anti-EPP-coalition of Socialists, Liberals, Greens and the extreme-left would still narrowly lack a majority.

    5 things to look forward in the coming days and weeks:

    1. The informal European Council two days after the elections resulted in a draw. Neither the heads of state and government nor the European Parliament group leaders were able to impose something, neither a Spitzenkandidat nor the end of the Spitzenkandidaten system.

    While the Europarty delegations meet in order to help forward the search for a package deal (Commission, European Council, Parliament and European Central Bank presidents), Donald Tusk has the formal task of finding a majority within the European Council for the nomination of a new Commission President. If he fails to do so by 20-21 June, there is still some time left for an extra Summit before the new Parliament meets on 2 July.

    2. The first thing the European Parliament has to do, however, is to vote on a president. Likely, this will indicate the composition of the working majority for the 2019-2024 legislature.

    3. Next, onto the positions, where there is an ongoing battle over content. Formally, the Commission is in charge of setting the agenda for the next five years, given its prerogative of legislative initiative. However, both the European Council and the European Parliament want to have a say on this strategic agenda. In other words: will the new deputies or the member state governments decide what the priorities of the new Commission will be?

    4. Once the Commission President-elect is known, national governments will be asked to nominate their Commissioners. This raises the question: what kind of strategy will the governments of Poland, Hungary, etc. follow? Will they oppose the Commission by sending candidates with clear Eurosceptic profiles, relying on these Trojan horses to undermine from within? Or will they accommodate the new Commission President, hoping to receive powerful portfolios for their Commissioners in return?

    5. Brexit. Exactly in the same period, the Tories will choose a new leader. He (there are no female candidates left) will become the new UK Prime Minister. In any case, October 31st is the new Brexit deadline. Preparing for a no-deal scenario or granting another extension will be the responsibility of the ancien regime, but whatever the outcome will be, it will be an issue on the table for everyone taking up political responsibility in the EU for the forthcoming 5 years.

    Steven Van Hecke Brexit Elections EU Institutions EU Member States European People's Party Leadership

    Steven Van Hecke

    4 weeks after the European Elections: what to remember and what to watch out for?

    Blog

    19 Jun 2019

  • Now that some of the dust has settled, the European People’s Party should start drawing the lessons of the EP2019 election and define the agenda ahead. The Wilfried Martens Centre for European Studies, at its annual Think-In with its member foundations across the EU in Prague in early June, has developed a list of points to be considered. They are based on the individual reflections of member foundation representatives, and are subdivided into four chapters:

    Identity:

    Any deep post-electoral analysis begins with the questions: who are we? Who do we want to be? Much has been made of the obsoleteness of the classical left-right divide in politics. Many claim that in the wake of the crisis of the West, and more specifically the economic and migration crises of the last 10 years, the new paradigm is ‘open vs. closed’, pitting global, liberal thinking and borders open for migration and trade against local, traditional thinking and protectionism in terms of trade and migration. Against that backdrop, it does seem logical to look for a new self-description of the EPP political family. Alas, it is no coincidence that in the open vs. closed paradigm, the EPP has a foot in both camps. If we let that rift grow, it will weaken and eventually destroy us.

    But if we turn this weakness into a strength, by maintaining and actually reinforcing a common bond beyond and above the new political divide, then we can still remain Europe’s strongest political force. Such a bond is most likely to be found in the combination of Christian Democrat, conservative, liberal and centrist political thought that has already defined our political family in the past decades. If a new term better suits this complex picture than the time-honoured labels ‘people’s party’ and ‘centre right’, then let’s go for it. But it will be no easy task.

    Strategy:

    Out of the many strategic conundrums for our political family, three stand out:

    • Who is the enemy? Until the late 2000s, the answer on the European level was clear: our main competitor (but also permanent cooperation partner in the EP) were the Socialists. Extremists left and right were enemies, but not so relevant. Since the economic crisis after 2008, and especially since the migration crisis after 2015, the populists (mainly from the right) have increased in strength, while social media has helped them garner attention and create echo-chambers. Since 2017, the European Liberals have become more of a competitor, with Macron’s attempt to repeat on the EU level the total remodelling of the party system that he successfully managed in France. Finally, the Greens have now emerged as a serious competitor, at least in North Western member states.
    • Copy and original: in the debate about the proper centre right answer to populism, one often repeated statement stands out: If we try to copy the populists, the voters will always prefer the original to the copy. That is as often true as it is false. It just depends on the circumstances in place. But the dilemma can now be extended to our new struggle to come to grips with the popularity of the climate change issue and the rise of the Greens in some important member states. The challenge here is to address climate policy more intensively, but using tools and approaches of the centre right, not trying to copy the regulatory approaches of the Greens.
    • Maintaining unity: the EPP political family has seen a constant expansion since the 1980 in terms of member parties, which has automatically led to a wider variety of political standpoints. If this unity has now begun to falter (as in Spain and France, for example), the position of the EPP as the strongest political family is in serious jeopardy. Maintaining unity, however, presupposes defining and strengthening what still binds us together: fundamental values such as freedom/responsibility, subsidiarity etc. But maintaining unity can also mean saying goodbye to member parties which are endangering cohesion.

    Topics:

    Europe’s centre right has a number of classical areas of competence: first and foremost, these are security and economics – meaning defence and homeland security as well as fiscal prudence and policies leading to economic growth. Migration, the most important topic for many Europeans 2015-2018, has – to some extent – become an issue of competence for the centre right, at least more than the left. But in #EP2019, a number of new issues have emerged that are calling for more attention from the EPP political family:

    • Climate: there is near universal consensus that the climate topic is important, that it is here to stay and that the EPP so far has not excelled in climate policy. Having said that, it is still important to keep in mind that the boost for the Greens has happened only in a North-Western minority of member states: practically the entire South, as well as the East of the EU are not affected for the moment. And of course, climate policy may be replaced by other, even more urgent topics, in a few years, such as migration or the economy.
    • City-countryside gap: the growing divergence in lifestyles, socio-economic challenges and political attitudes couldn’t be more obvious. While taking into account the interests of city dwellers, the EPP political family would neglect the countryside at its own peril: France’s Yellow Vests are a case in point.
    • Middle class: the ‘squeezed middle’ – in terms of work-life-balance, education, gender equality, income/taxation etc., has been a favoured topic of many member parties in recent years. This should be maintained as a trademark.
    • Christian Europe: some member parties strongly favour this as a priority while others believe in a more eclectic message, focusing on a broader array of values, civic rights and an inclusive approach to other religions. It will be a challenge to create consensus on this.
    • Digital: the future of the internet, especially the balance between corporate-driven innovation, privacy, freedom and fighting abuse, is another issue that warrants more attention from the EPP.

    Tactics:

    • Electoral coalitions: several successes (in Poland, for example) have shown that in specific contexts, such as small countries or constituencies with single or few seats, creating joint electoral lists with other political parties may be the only chance for the EPP parties to maintain or expand their strength.
    • Communication: a constant challenge for centre right parties, especially when faced with populists and Greens. This goes far beyond the right use of social media, and extends to using less bureaucratic language in general, and be more open to entertainment as a factor in politics. Being less boring and yet maintaining the EPP’s political salience is the challenge here.
    • Outreach to the young generation: in several member states (this time not only in the Northwest), the centre right is now risking to lose young voters on a scale last seen in Western Europe in the 1970s. This refers to policy issues (climate change, digital, education) but above all to styles of communication, transparency etc. as well as including more young candidates on electoral lists.
    • Personalities: without charismatic leaders appealing to large numbers of voters, the EPP has no future. That’s a so-called no-brainer. And yet, a direct succession from one charismatic leader to the next is the exception rather than the rule. Recruitment of leaders and smooth leadership transitions are areas for the EPP to work on.
    Roland Freudenstein Centre-Right Elections EU Member States European Union

    Roland Freudenstein

    After #EP2019: first points for a centre-right roadmap

    Blog

    14 Jun 2019

  • The aim of the current In Brief is to explore the possible disinformation threats in view of the European elections in May 2019. European voters are exposed to similar negative narratives and strategic disinformation campaigns which managed to influence a large number of citizens in the run-up of the US Presidential election and UK European Union membership referendum in 2016. The analysis also explores ways to tackle future malign information operations by proposing  specific  policy  recommendations  for strengthening the European and national institutional capacity and also obliging digital companies  to  improve  their  efforts  in  the  fight against disinformation. 

    Elections EU Institutions EU Member States Internet Technology

    European Parliament Elections: the Disinformation Challenge

    IN BRIEF

    24 May 2019

  • European security and defence cooperation has seen more progress

    in the past several years than it had in the previous 60 years.

    But have we reached strategic autonomy yet?

    The development of autonomous European security and defence cooperation has been characterised by unprecedented dynamism and vigour in recent years. European Commission Vice-President Jyrki Katainen once noted that the EU has made more progress in this area in the past several years than it had in the previous 60 years. He is correct.

    Since 2016, the EU has, inter alia, set up a Coordinated Annual Review on Defence for harmonising its members’ defence planning and procurement cycles, established Permanent Structured Cooperation for voluntary (but legally binding) project-based capability development, and launched a European Defence Fund for funding joint defence research and capability development projects. Such progress would have been unthinkable only a few years ago.

    The progress has not been limited within the framework of the EU, however. In 2018, France and its closest European partners launched the European Intervention Initiative (EI2) to enhance contacts between the participating countries’ armed forces and, in the long-term, to facilitate the emergence of a common strategic culture. In 2019, France also setup an Intelligence College in Europe to improve the connectivity and visibility of European intelligence cooperation. Although European in character, these structures are outside the EU.

    The quest for strategic autonomy

    The purpose of all these new initiatives is to facilitate Europe’s quest for ‘strategic autonomy’, its grand strategic ambition. Strategic autonomy as an idea was introduced to the general public by the EU’s 2016 Global Strategy. Although the document mentions strategic autonomy five times, it makes no effort to define the term. However, strategic autonomy can be understood as the ability to act on the world stage but especially in Europe’s neighbourhood without third-party (i.e. American) assistance.

    This kind of autonomy depends on several things. It depends, first of all, on Europe having the capabilities that enable it to handle various crises and challenges. In the past, Europe’s effectiveness as an actor has often been undermined by shortages in specific capability areas.

    In 2008, Russia contributed four helicopters to an EU-led operation in Chad because the Union could not get its own member to contribute a sufficient number of helicopters. During NATO’s 2011 operation in Libya, European countries quickly depleted their stocks of smart munitions and had to purchase stockpiled munitions from the US.

    The good thing about capabilities is that they are material in character: they can be researched, developed and purchased for a price. However, strategic autonomy is not just about muscle; it is also about a specific mindset that enables an actor to use its capabilities when necessary. In the past, this has often proven challenging for Europe.

    Due to its member states’ reluctance act in areas in which they have no immediate interests at stake, EU action has often fallen below of what was initially required (e.g. in Mali in 2013), been prohibitively slow (e.g. in the Central African Republic in 2014) or non-existent (e.g. in the Democratic Republic of the Congo in 2008).

    Not just about institutions and capabilities

    In fact, Europe’s ability to achieve strategic autonomy is likely to depend far less on Brussels-based institutions and the acquisition of capabilities than it will on Europe’s ability to overcome what could be labelled as the ‘aspirations-leadership gap’: a gulf between Europe’s desire to become a fully-fledged international actor and the level of leadership that especially big European countries are willing show in turning that desire into reality.

    To illustrate this, think of NATO. Contemporary discussions on strategic autonomy often miss that NATO is an effective actor not because it would have its own army (it doesn’t), because it would use qualified majority voting for decision making (it doesn’t), or because it would have its own resources (it doesn’t). Instead, NATO is able to act because the US is the Alliance’s de facto leader. When push comes to shove, Washington has had—at least in the past—the authority to bang heads together and convince its allies over the necessity of action.

    The EU has no such leader. France tries to play this role and has some claim to it by virtue of its defence spending and highly capable armed forces. However, most EU countries don’t share many of France’s strategic priorities in areas such as the Sahel and Sub-Saharan Africa. Germany could play this role but is unwilling to do so due to its semi-pacifist strategic culture that has been shaped by its difficult twentieth-century history.

    Finally, the UK, arguably Europe’s most capable country, is expected to leave the EU sometime in the not-too-distant future and is in no position to show leadership on any European issue for a long time.

    A possible solution for closing the aspirations-leadership gap might be to utilise various core groups or directorates more actively. Indeed, this seems to be the direction where Europe is heading with initiatives such as PESCO and the EI2.

    French President Emmanuel Macron’s recent meeting with Chinese President Xi Jinping in Paris, to which he also invited German Chancellor Angela Merkel and Commission President Jean-Claude Juncker, is also a step in the right direction but should be expanded to make such meetings geographically more representative of Europe’s diversity. They could also help in paving the way for the creation of some kind of European Security Council, an idea that is being discussed.

    These and other plans currently on the table such as the formation of a ‘European army’—most likely by expanding and revising the EU’s existing battlegroup concept—need to be discussed openly. When choosing the EU’s next foreign policy chief after the European elections, the member states should also prioritise the appointment of someone who enjoys a high level of confidence in all major European capitals to improve the general effectiveness of EU foreign policy.

    Every little helps in closing the aspirations-leadership gab but the main effort needs to come from the member states themselves.

    Niklas Nováky EU Institutions EU Member States Leadership Security

    Niklas Nováky

    Europe’s aspirations-leadership gap

    Blog

    20 May 2019

  • Here we go again. With slowing growth, increasing debt and an uncertain global environment, Italy faces another budgetary crisis in 2019.  Once again Rome will face Brussels in a battle for fiscal sovereignty. The result? Either another political fudge or the end of Europe’s current fiscal rules as a credible policy tool. This In Brief argues that there is an alternative to engaging in repeated political arguments about existing fiscal rules.  Rather, the EU should recognise the fundamental weaknesses in the governance of the eurozone.  A move towards a more decentralised monetary union based on the concepts of national fiscal autonomy and a credible no-bailout rule is now essential.  Only then will the eurozone have a realistic chance of long-term survival.

    Economy EU Member States Eurozone Macroeconomics

    Why Italy should spell the end of Europe’s fiscal rules

    IN BRIEF

    16 May 2019

  • The Martens Centre is pleased to announce that this year’s awards for “best cooperation” and “best activity” during the year 2018 have been awarded to Kós Károly Akadémia Foundation (Romania) and Wetenschappelijk Instituut voor het CDA (CDA Research Institute) (Netherlands), respectively. Now in their seventh year, the annual Martens Centre Action Awards underscore outstanding cooperation in all aspects and serve as recognition of the immense quality and impact of projects in cooperation with the members of our Europe-wide network. While the competition for this year’s awards was fierce, given the sheer quality of our member foundations and the projects to choose from, in the end the decision was unanimous.

    Throughout 2018, KKA has worked diligently and effectively, forming synergies throughout our network and beyond, to deliver smooth-functioning joint activities with the Martens Centre. Their exemplary work was particularly highlighted in a jointly organised training seminar in Cluj-Napoca, “Millennial Leaders: Effective involvement of the touchscreen generation”, where 19 participants from 7 countries were trained in cutting edge communication techniques, with the overall aim of encouraging greater political participation of the millennial generation.

    For the category of “best activity” of 2018, CDA WI has been awarded for their exceptional work on Het Midden (The Middle Class: The middle class as the moral core of society). This timely edition, a follow-up to the 2017 research No Robots: The position of middle-class households in nine European countries, explores the current state of the middle class in the Netherlands and the rest of Europe and what impact this has on civil society as a whole and on European politics. This impressive publication is already having an impact and is gaining traction among policy makers.

    With these awards, both political foundations have become strong examples to our other members, raising the bar of the quality of our joint projects while illustrating the sheer talent of the Martens Centre’s network. Working closely with national partners in 2019 and beyond will continue to allow us to bring the European debate where it matters the most: closer to the European public.

    EU Member States European People's Party Leadership

    Two Martens Centre member foundations rewarded for outstanding achievements in 2018

    Other News

    08 May 2019

  • On the 1st of May 2004, the EU was enlarged by eight post-communist countries along with Malta and Cyprus. Today, we are quite obviously asking a number of questions: what has this massive European enlargement brought to these countries? And, on the other hand, how and in what way have the new member states enriched the EU?

    We should also ask what mistakes should be avoided in the future because, while the vision of Europe ‘whole, free and at peace’ has not yet been fulfilled, we are already facing the phenomenon of an East-West divide within the EU itself.

    These days my country Slovakia is taking stock of the first fifteen years of its merge with the West. This is happening just before the European elections, and, since January, I have held discussions with Slovak secondary school and university students, looking together with them for answers to the questions raised above.

    Slovakia is an ice-hockey obsessed country, so I borrowed ice-hockey parlance to assess my country’s membership of the EU, and I divided this fifteen-year period into three thirds.

    The first third: Honeymoon with the West

    In May 2004, the weather during the ceremony in Dublin was beautiful; the Slovak national flag was raised on one of the 25 flagpoles in the garden of the Irish President’s residence. It seemed as though the fair weather boosted our conviction that the future would be similarly cloudless. And, for a few years, this was indeed the case.

    Enlargement euphoria and the strong desire to emulate the West of Europe encouraged us to pursue deep structural reforms that transformed Slovakia into one of the economic leaders in the region. This great commitment to changing the country was completed through joining the Eurozone in 2009.

    Our strong ‘drive to score’ was also carried over into foreign policy, culminating with the Bush-Putin Summit held in 2005 in Bratislava. EU membership had consolidated our democracy and brought stability and prosperity to Slovakia, the region, and also the EU.

    The second third: Awakening

    Despite these auspicious beginnings, we soon woke up to the realisation that in this newly-united Europe we would not always be blessed with ‘good weather’. The first clouds had already started to gather right when Chancellor Schroeder’s government signed-off on an agreement with Russia to build the Nord Stream II pipeline.

    No regard was taken of the fact that the capacity of the existing pipeline leading through the CEE countries was more than sufficient. Later on, we would have to endure further storms, like the aftermath of the global financial crisis.

    The bailouts to Greece, granted in order to keep it in the Eurozone, were painful for us, the new member states. I did not understand the pressure exerted on us by the leaders of certain older member states, who failed to recognise the consequences of harsh economic reforms and structural changes in the post-communist countries.

    From one day to the next, we were asked to comply with the same demands as older and significantly richer member states. Just as we had managed to overcome our own existential difficulties, we instantly became embroiled in the existential difficulties of others – difficulties we had no part in causing.

    Not infrequently, the leaders of the CEE countries felt that when it came to serious decisions they were simply expected to play along, without being given a chance to influence those decisions in a more substantial way. This is how it played out in the case of the Greek loan facility, or in the case of the already mentioned North Stream II.

    The third third: Disenchantment

    The developments of recent years tied to migration flows have shown that these new member states are neither ready, nor willing to bear this common burden, or to put forward solutions. This status quo has no future and must be changed. The CEE countries must learn to better understand the solidarity principle.

    At the same time, older and more cosmopolitan countries must learn to better understand the completely different historical experience and degree of social conservatism that exists in this part of Europe.

    There are too many misunderstandings and too little real dialogue in the EU today, especially between East and West. There cannot be real dialogue if we do not acknowledge and respect of each other’s culture and history.

    An important takeaway drawn from the current climate of disenchantment in Europe has been the realisation that establishing a democracy is not a one-off event, it is an ongoing project that must be protected and nurtured each day.

    It is true that this does not apply only to Visegrad countries. Populism and extremism are also gaining a foothold in Europe’s advanced democracies. Therefore, the EU needs to become a true federation combining a strong but limited centre with strong members states.

    That said, there may also be light at the end of the tunnel for Slovakia. The squares crowded with people after the murder of journalist Ján Kuciak and his fiancée brought down the prime minister and re-activated civil society, as well as mobilising the political participation of young people.

    Recently elected to the presidential office in Slovakia is a civil activist who managed to stand her ground against evil and prevailed against the odds. This trend must be fostered and encouraged by putting forward a new, attractive and forward-looking vision for the whole of the EU.

    I am convinced that such a vision has the potential to inspire and motivate us in the same way I was inspired by the vision of a Europe “ whole, free and at peace” in 1998. That year, I rode my bike across the country in the name of such a vision, calling on my fellow citizens to join me on the journey.

    I still remember how distant this vision seemed to me then, but the undying belief in that vision brought change to Slovakia – change for the better. In an era of similar challenges, the time has come to set out on a similar journey once again.

    Mikuláš Dzurinda Enlargment EU Member States European Union Leadership

    Mikuláš Dzurinda

    The Big Bang Enlargement at 15: lessons learned vs lessons applied

    Blog

    30 Apr 2019

  • It’s one of the more naïve, but appealing, narratives circulating around disbelieving Brussels at the moment. Britain – sick of the convulsions of this never-ending Brexit – will eventually allow pragmatism to win out.

    Parliamentary compromise (however tortured) will restore Britain to its rightful place in the EU, or in a worst-case scenario, to a cashmere-soft Brexit complete with a customs union and possible membership of the single market. Teresa May will resign with the Tories destined for the opposition benches amidst an in-house civil war.

    But this is a delusion. Rather than cause a British (or English) political revolution, Brexit will actually solidify existing British political structures. Brexit – soft, but real – will strengthen Tory rule. This is disturbing, but inevitable.

    As the Fabian Society have pointed out, Labour is becoming increasingly concentrated in major cities with higher levels of ethnic diversity and young adults.  But, even more importantly, in areas most commonly defined as ‘working class’ there has been a noticeable swing to the Conservatives since 2005.

    Although, the current ‘first past the post’ system mitigates against dramatic upheaval the longer-term implications are clear. Limited potential for future electoral gains for the Labour Party in urban areas (for example, Labour already holds 23 out of 27 seats in Greater Manchester) coupled with the potential for the Conservatives to gain traction, if not seats at first, in staunchly Labour, but Brexit supporting areas.

    This isn’t science fiction, or even political fantasy. It’s the new politics of the vulnerable, disconnected masses.  Nor is this unique to Britain, electoral maps and traditional voting patterns have been eviscerated in states as diverse as Italy and the Netherlands in recent years.

    A Tory party – with an engaging and coherent leader (if this exists) – should be able to act as an umbrella for all Brexit supporters from the hard right to the more malleable centre. Will Jacob Rees-Mogg and his European Research Group (ERG) friends really prefer the principled isolation of Westminster to the Conservative high table? The Tories are too fond of power for that.  In fact, the composition of the “Independent Group” in Westminster shows that while the Tories may splinter, Labour might lose a whole branch. 

    The absence of a coordinated Remainer group in the Conservatives also renders their overall strategic position relatively clear.  Hard Brexit or soft Brexit is up for discussion, but Brexit it will be. Those who will leave the Tories over Europe have, in fact, already left.  Closet Remainers, such as Phillip Hammond, will never jeopardise party unity for Europe. 

    They simply don’t care enough about Brussels to make that leap.  Moderate, pro-European Tories – such as Ana Soubry and Nick Boles – have already been written out of Conservative Party history.  Ken Clarke stands as a noble and proud throwback to a different age, and a different Tory party.

    Finally, any sort of Brexit – be it May’s deal or anything softer – will allow the Tories to make a coherent election pitch lifted straight from Labour Party policy: we delivered Brexit but simultaneously protected jobs and trade in the long run.  This isn’t really coherent policy or even good for Britain, but its clever politics and would make the most of Teresa May’s dreadful period in charge. This approach will also allow the Ulster Unionist’s to sing loudly of the United Kingdom’s territorial integrity.

    Of course, in a political context, the fissures of Brexit aren’t that unique.  The Suez crisis of 1955/56 was marked by Conservative Party splits (including a ‘Suez Group’ whose emotionally charged nationalism echoes clearly in today’s ERG), divided families and ultimately the fall of a once well regarded Tory Prime Minister.  But Suez, driven by an almost visceral need to sustain a global role, ultimately failed because of economic realities and American pressure.

    But Suez is more important because it shows a pathway forward for the Conservatives.  Suez did not spell electoral disaster for the Tory party or for the British economy. Under Harold Macmillan (ironically one of the staunchest initial backers of military action in Suez) the Conservative Party successfully retained power in 1959 with a larger majority.  Increasing middle-class mobility, economic growth and a recast Anglo-American alliance (albeit with Britain as very much the junior partner) sustained a relatively harmonious political landscape for the Tories up to the early 1960s.

    Clever Conservatives should now prioritise delivering a cashmere Brexit; soft to the touch but warm enough to repel the chill from the political extremes.  This is not the best solution for Britain, nor for Europe.  But Brussels has resigned itself to Britain leaving and now understands that Britain in Europe is no longer possible.

    It’s simply too destabilising for the entire European project. Nobody in Brussels believes that Jeremy Corbyn’s instincts lie anywhere other than in a dated view of the EU blocking his socialist revolution. In that context, for both Britain and Europe, there can be no turning back.

    Eoin Drea Brexit EU Member States Leadership Political Parties

    Eoin Drea

    Why a cashmere Brexit will save the Tories

    Blog

    09 Apr 2019

  • In the era of populism old ideas are being rolled out again. One of them is the concept of basic income, which has recently been circulating in many political debates in various member countries and international conferences, including Davos and the World Economic Forum’s annual meeting this year. Many variations of basic income are on the table, and some have even been translated into electoral promises, for example Five Star’s late proposal on Citizens’ income.

    Finland’s former government actually ran a pilot project on basic income, whereby 2,000 people across Finland were paid a tax-exempt income of 560 euros for two years. Participants were unemployed, and no other conditions were required to receive the payment.

    The pilot project received much more enthusiasm from outside Finland than within Finland itself. The main reason might be that while outside Finland the pilot project was taken as an indication of structural change to the whole social welfare system, in Finland the project was really seen as just a test, mainly launched to realise a long-standing objective of the Prime Minister’s Centre Party.

    The first set of results came out more than a month ago. While more specific studies are yet to be published, these results indicate that while people receiving the income were happier, the income did not have an impact on the employment status of the test group.

    In Finland, reactions have not been enthusiastic. Heikki Hiilamo, Professor of Social Policy at the University of Helsinki, has commented on the preliminary results of Finland’s basic income experiment, noting that effects on the labour market were minimal, and survey results demonstrating that basic income recipients had better subjective well-being are questionable.

    These results indicate that while people receiving the income were happier, the income did not have an impact on the employment status of the test group.

    Taking the results into account, it is not surprising that with the Finnish parliamentary elections taking place in just two weeks’ time (on 14 April), and with other reforms taking centre stage of discussions, the basic income topic has faded away totally from the electoral debate. Indeed, while many parties initially made proposals they called ‘basic income’, after it was pointed out that these proposals do not really respect the basic definition, the label was dropped.

    Reflecting on the results of the basic income experiment, Finnish politicians Juhanna Vartiainen and Asmo Maaselkä  pointed out that basic income is not suitable for a developed country like Finland, especially if it happens to be of large geographical size. Basic income is not able to equalise the cost of living in different parts of the country in the same way as income support can, nor does basic income adapt to the situations of different families.

    Basic income would possibly suit countries with low levels of basic security and a low cost of living with a lot of low-skilled work not requiring higher education, i.e. developing countries, not countries in Europe.

    Introducing real basic income would mean radical reform of labour market structures

    In addition, basic income cannot be debated without speaking about compatibility with labour market structures, starting with incentives for the labour market to target specific groups, such as young people without qualifications. 

    In order to ensure that getting and applying for a job would remain attractive, the society-wide labour contracts would need to be rethought if basic income were introduced, as would the minimum wage and the prohibition of zero-hour contracts, for example.  This was obviously not done in Finland due to the temporary nature of the experiment, and the results speak for themselves: there was no boost in the integration of people into the job market.

    If the cost neutrality of introducing basic income is taken as a guideline, the problem of basic income to the political left becomes obvious. Already existing support, allowance and regulatory structures which have been dear to the left would need to be erased. As an example, the Finnish Social Democrats (SDP) oppose the basic income.

    The entry of basic income into Finnish political discussions appears temporary based on what we can see from the current debate. However, the debate around basic income is useful; complex social support systems and overlapping unemployment benefit schemes need reform and simplification in most European countries.

    The need for simplification most likely means that in many countries some variation of a universal credit system will be debated, but as UK’s experience with the universal credit system shows, simplification of multi-layer system takes a lot of effort.

    In a similar way to Finland’s political debate, many proposed models will be called ‘basic income’, but in reality represent only some variation of it. Pure basic income will hardly be introduced in European countries, but simplification of our current social and unemployment allowance systems is absolutely needed.

    Tomi Huhtanen Economy Elections EU Member States Jobs Social Policy

    Tomi Huhtanen

    Basic income is basically unworkable – so let’s drop it

    Blog

    02 Apr 2019

  • For those seeking to understand the debate in Britain about leaving the EU, it is important to understand that history—or rather a certain Eurosceptic Tory interpretation of British and Imperial history—played a key role in building and sustaining the momentum for Brexit, both during and after the 2016 referendum. In this context, the process of Britain leaving the EU can be seen as the triumph of a misrepresented and selective view of British Imperial history and an unbending view of the primacy of the nation state. This narrative was combined (quite quickly and unpredictably) with a rise in economic nationalism and populism stimulated by the global economic crisis that commenced in 2007. This combination, in turn, challenged long-established political norms such as Britain’s membership of the EU. These were challenges that were largely based on a mutated form of British declinism and a fatalist view of the EU.

    Ultimately, this paper concludes that it is not in the interests of Brussels that Britain should either seek to remain (or gain re-admittance in the future) as a full member of the EU. Rather, Britain’s historical self-conception is more conducive to a looser, yet clearly defined relationship with Brussels, based on shared political, economic and security interests. Such an arrangement—a bespoke Anglo-Continental compact—is more consistent with Britain’s political realities and accepted historical narratives. It will also better preserve the integrity of the EU’s internal cohesiveness, which since 2016 has become unavoidably intertwined with Britain’s search for relevance in this post-colonial age.

    Brexit Economy EU Member States Euroscepticism Macroeconomics

    The Empire Strikes Back: Brexit, History and the Decline of Global Britain

    Research Papers

    12 Mar 2019

  • 2018 was a very special year for our organisation as we celebrated the first decade of our existence. We took our anniversary not just as an opportunity to celebrate, but also as a chance to reflect. It seemed crucial to us to set up objectives to counteract all political challenges for the decade ahead.

    Centre-Right EU Member States European Union Leadership

    Activity Report 2018

    Activity Report

    04 Mar 2019

  • A no deal outcome to the Brexit saga has become increasingly likely because prime minister May has decided that her priority is to avoid a split in the conservative party. She has calculated that, if she tried to get her deal through with mainsteam labour support – her conservative party would break up. She would lose 50 to 100 members of parliament and cease to be prime minister.  She is trying instead to win over individual labour members by promising spending in their constituencies, a desperate tactic that corrupts the political system.

    Brexit EU Institutions EU Member States European Union Political Parties

    Catharsis, not compromise, is what Brexiteers want

    IN BRIEF

    01 Mar 2019

  • One year ago, Slovakia was shaken by the brutal murder of investigative journalist Ján Kuciak and his fiancée Martina Kušnírová. Prior to his untimely death, Kuciak was working on the links between the Italian mafia and Slovak government officials, focusing on the misuse of EU funds.

    In particular, Kuciak was working on the case of an oligarch who has, time and again, emerged from various scandals unscathed simply because he had “buddies” in the government, the police, and the prosecution. Now, all of the evidence is pointing to the conclusion that the oligarch is behind the murders. The outcome of this investigation could bring results that might cause a major earthquake throughout the Slovak political scene.  

    The socialist government, who is responsible for the current state of the country, is seen as an unbending force that is taking the country in the wrong direction, most notably for its failure to modernise the country,  for its complicity in corruption, and for the controversial declarations made by former prime minister of Slovakia, Robert Fico, regarding Slovakia’s ambition to be among the core members of the EU. After its successful EU presidency, Slovakia enjoyed a solid pro-European image when compared to other Visegrad countries.

    Today’s image of Slovakia is largely that of a corrupt-ridden country. In the latest Transparency International Corruption Perceptions Index, Slovakia was ranked as the sixth most corrupt country in the EU. Slovakia has become a country where journalists, civic activists or ordinary citizens who expose corruption scandals are intimidated or, in the worst cases, silenced. Presently, Slovakia is in the grip of the kleptocrats, and after almost 15 years of EU membership, the foundations of democracy and the rule of law are still very fragile.

    The murders of Kuciak and his fiancée have mobilised Slovaks to take to the streets and protest under the slogan “For a Decent Slovakia”. These protests were the largest rallies since the fall of Communism. The gatherings eventually led to the resignations of Prime Minister Fico, the minister of the interior and the president of the police force.

    Nevertheless, Slovakia has not yet witnessed any genuine policy changes. Fico’s puppet has since been appointed Prime Minister and Fico himself has since escaped from politics by running to be a judge of the Constitutional Court. By being appointed as a new president of the Court, Fico would obtain 12 years of immunity and a status that would allow him to review the constitutionality of laws and measures that his own government drafted and pushed through parliament.

    The Socialists’ coalition partner, Andrej Danko, a nationalist and the parliament’s speaker, has a different passion – he loves the Kremlin and its regime, and is openly critical of the “uselessness” of sanctions against Russia. He is a frequent guest of Chairman of the State Duma who is on the EU sanctions list.

    After US Secretary of State Mike Pompeo concluded his visit to Slovakia, Andrej Danko flew to Sochi to meet Russian Minister of Foreign Affairs Sergey Lavrov, where he stated that “[Slovak] politics should not, as it had been under Communism, be oriented to only one side, and that we should talk to both the Eastern and the Western countries.” That sounds familiar: In 1990, Slovak politicians remained undecided regarding the anchoring of the country towards the West, which resulted in the exclusion of Slovakia from EU and NATO accession talks.

    This year, Slovakia is celebrating its 15th year as a member of the EU and NATO and the 30th anniversary of the fall of Communism. These milestones are a testimony to Slovakia’s failures, but also to its ability to rise again and realign its course to the right path.

    In two weeks, Slovakia will be put to the test in terms of maintaining democratic process and on its ability to return to the right path, through the presidential elections. Fico’s presidential candidate will be European Commission Vice President Maroš Ševčovič, who still recently had the ambition of leading the European Socialists into the European Parliament elections in May.  

    Last week, however, Fico and his SMER party blocked a parliamentary vote on the appointment of judges to the Constitutional Court. As a result, Slovakia has been plunged into a constitutional crisis – the Constitutional Court is left with only four sitting judges, instead of its normal composition of 13.

    Fico has blocked the election of new constitutional judges because he fears that even if he were to be elected by Parliament, President Kiska would not appoint him to the Constitutional Court as its member, let alone its chairman.

    It seems that he is waiting for a new president ‘of his choosing’. The problem is that Maroš Ševčovič has been avoiding the question of whether, if elected President of the Republic, he would appoint Robert Fico to the Constitutional Court.

    What is at stake in this case is not Ševčovič as a person, but rather the future of Slovakia. It is a question of what principles will prevail in Slovak politics: Will it be those of liberal democracy with its checks and balances, or will it be an even further concentration of power in the hands of a modern-day kleptocracy?

    Last Thursday, peaceful demonstrations took place in several Slovak and European cities in memory of Ján Kuciak and Martina Kušnírová. Let’s hope that this encourages all Slovak democrats to vote in the upcoming presidential elections with a mindfulness of the very needed opportunity to realign with the path of justice, morality and decency in public life to be restored.

    Viktória Jančošeková Democracy EU Member States Leadership Political Parties Society

    Viktória Jančošeková

    Is Slovakia heading towards a political earthquake?

    Blog

    26 Feb 2019

  • After a prolonged political and legal skirmish, EU officials finally reached an informal compromise last week on the reform of the Union`s Gas Directive. Hailed as an important achievement, the compromise mostly aimed to rein in the Nord Stream 2 pipeline and ensure that the EU keeps Gazprom in check when it comes to gas supply and competition rules.

    Who Calls the Shots

    These changes were hastily proposed in 2017 by the European Commission in the desperate attempt to get some say over the construction of the Nord Stream 2 project which would substantially boost the direct gas flow between Russia and Germany. The construction of the pipeline has been the Apple of Discord between Germany and many Central European and Baltic countries. Berlin has faced growing criticism for allowing a pipeline project which will further increase Russia`s energy dominance and directly endangers the energy security of CEE countries.

    The amendment of the Gas Directive didn`t intend to cancel Nord Stream 2 altogether but to make sure that the Gazprom-led project would comply with European energy legislation for ownership unbundling, third-party access and non-discrimination in tariff setting. Compliance with these provisions would require Gazprom to adapt their approach and be bound by a new set of rules which may hurt their business model.

    The adopted compromise (text still not officially voted) make such rules applicable to new pipelines, but also grants the member state which is the first point of entry of the pipeline the right to ask for an exemption of these rules. This places Germany in a favourable position to push for such an exemption and ensure not only that the project goes through but that it also secures a lax regulatory treatment. Even though the Commission is the one which gives the final decision, it is unlikely that the freshly sworn-in EU executive will confront Merkel head on in late 2019.

    German Solidarity?

    The seemingly successful compromise on the Gas Directive manages to brush aside the most relevant question – why is Nord Stream 2 allowed to be constructed in the first place? This project has little rationale as it will not bring new gas to Europe but mostly redirect the current supply transmitted through Ukraine. The ultimate aim of Moscow is to completely circumvent Ukraine and redirect most of the energy resource directly through the Baltic sea.

    Germany is going ahead with the construction of a project which has been condemned by several heads of state and the majority of the European Parliament as going against Europe`s interest. Moreover, Berlin is opening an additional avenue for further systemic corruption and political influence for Gazprom which is a direct conduit of the interests of the Kremlin.    

    For Angela Merkel, the current developments under the umbrella of a ‘European solution’ to Nord Stream 2 bring a sigh of relief. For several years she has been locked in this project mostly due to pressures from her coalition partner the Social Democratic Party (SPD). The infamous legacy of Gerhard Schröder and Sigmar Gabriel has committed Germany to this pipeline, regardless of the split it causes between Eastern and Western EU member states and also the betrayal towards Ukraine.

    Irrespective of Russia`s military aggression, foreign interference in elections and energy blackmail of smaller EU-member states, for Germany it seems as if it will be business as usual when it comes to pipelines.

    A Humiliation for Europe

    Ensuring the diversification of energy supply and speaking with one voice on energy affairs have been top priorities for the European Commission and the still incomplete EU Energy Union. Regardless, the institution has struggled to play any meaningful role with respect to Nord Stream 2. The Commission even found itself in the embarrassing position of reminding journalists that the amendment of the Gas Directive was her proposal and not only the product of a Franco-German compromise.

    The only upside is that this situation might potentially give the EU additional leverage in brokering a parallel favourable deal for Ukraine in her attempt to continue to provide a transit route to several CEE member states. The revision of the Gas Directive might improve the chances of incorporating the interests of Kiev in securing future transit fees from Russia and keep Ukraine`s infrastructure operational to some extent. All in exchange for an exemption on Nord Stream 2, of course.

    And here lies the biggest problem. Instead of preventing the construction of the pipeline altogether, the member states have just managed to produce a lowest common denominator solution. Germany will get its cheap gas and even try to save face by promoting the importance of the achieved Franco-German compromise under European rules. In reality, this compromise is nothing more than a fig leaf for Germany.

    Dimitar Lilkov Energy EU Member States EU-Russia

    Dimitar Lilkov

    Nord Stream 2: a pyrrhic victory for Germany

    Blog

    19 Feb 2019

  • Under a monetary union, fiscal and monetary discipline have to go hand in hand if macroeconomic stability is to be maintained. The question is how to set up the right institutions to achieve this stability in a credible manner. This policy brief proposes a new institutional arrangement for the euro area to restore fiscal discipline. It places the responsibility for compliance entirely on the shoulders of the member states. It also provides for the mutualisation of 30% of the member states’ debt-to-GDP ratio.

    This would help to maintain a stable currency and to limit the risk of contagion should another crisis occur in the future. However, this comes at a cost. Under the fiscal scheme proposed, member states, which would be fully fiscally sovereign, would need to run long-term sound fiscal policies to benefit from euro membership.

    In addition,  this  brief  proposes  a  reform  of  Target2  under  which  overspending economies would have to pay the financial cost of accessing extra euros, which would deter the accumulation of internal imbalances within the euro area. All this is expected to change the current fragility of the architecture of the euro, provide member states with the right incentives to abide by sounder economic principles and make them fully responsible for the policies they adopt.

    EU Member States Eurozone Macroeconomics

    Rebalancing the Euro Area: A proposal for Future Reform

    Policy Briefs

    19 Dec 2018

  • One of the main concerns that voters are likely to have in their minds when casting their ballots in next  year’s european elections is security. This means that the EU needs an ambitious agenda in the area of security and defence for  2019-2024.  More specifically, it needs a set of concrete deliverables, which, if delivered properly and communicated effectively to european citizens, could help boost europeans’ sense of security where they might live in the Union.

    Defence EU Institutions EU Member States Foreign Policy Security

    Security and Defence policy: An Agenda for 2019-2024

    IN BRIEF

    29 Nov 2018

  • The ‘known known’ in the basket of uncertainties that is Britain’s withdrawal from the EU is the intention of the Commission’s negotiating team to maintain the integrity of the four freedoms. On the British side the objective is to enjoy some of the benefits accruing from its EU membership, whilst at the same time seeking to fulfil the democratic mandate to leave the EU conferred by the referendum verdict.

    In large part the withdrawal negotiations that ensued after the British Government invoked Article 50 have been a contest between these quite different, indeed conflicting, mandates. Both sides, each from its own standpoint, have offered quite different solutions to the conundrum of the Irish border. With Brexit day fast approaching, this singular issue has become a proxy for the altogether wider question of future EU–UK relations.

    At the time of writing, the entire sweep of these tense negotiations is concentrated on resolving the ‘Irish Question’—without success until finally a ‘technical’ agreement’ was reached by the negotiators. Whether this ‘solution’ will survive resistance from arch-Brexiteers remains to be seen.

    Brexit EU Member States European Union Integration Leadership

    Brexit and the Irish question, Part Three: Solving the Border Conundrum?

    IN FOCUS

    14 Nov 2018

  • This paper critically reflects on the development and implications of the Spitzenkandidaten system. It makes three claims. First, it argues that, despite the assertions of many commentators, this system did not appear out of the blue in 2014 but has a much longer history.

    Since the Maastricht Treaty, a series of steps have been taken that have clearly led the way to this outcome and, in fact, may even lead beyond it. These steps, including the role of the European People’s Party, are explained here as they cast a different light on the whole process, without which the success of the Spitzenkandidaten system cannot be properly understood.

    Second, the paper claims that, from a political–institutional point of view, the system implicitly promotes the parliamentarisation of the EU architecture and might eventually lead to a stronger EU executive and a weaker European Parliament, as is the case in most national parliamentary systems. This would be the opposite of what many of its supporters would like to see.

    Third, the paper concludes that, in order to avoid this unintended consequence and fulfil the democratic potential of the Spitzenkandidaten system, the current procedure must be understood as an intermediate step on the road to the direct election of the president of the EU. This, however, requires its success and consolidation in 2019. The paper thus ends with some recommendations that will help to make this happen.

    Elections EU Institutions EU Member States European Union Political Parties

    25 Years of Spitzenkandidaten: What Does the Future Hold?

    Policy Briefs

    06 Nov 2018

  • This paper aims to provide a critical analysis of the federalist doctrines that influenced the development of European integration. It argues that four federalist visions emerged at the dawn of European integration, each with its own specific ideological background and its own idea of what the federal Europe of the future should look like. The progressive federalism of Altriero Spinelli was different from the technocratic federalism of Jean Monnet, as much as the liberal federalism of Luigi Einaudi diverged from the personalist federalism of Christian Democrats.

    The  paper also contends  that  the  two  federalist philosophies most influential throughout European integration—those of Spinelli and Monnet— are founded on a unitary view of sovereignty and care little about protecting and retaining local state identities. On the contrary, within the Christian Democratic tradition there developed a bottom-up, culturally rooted federalism that was mindful of national and regional autonomy and averse to the concept of absolute sovereignty, be it national or European. Today, it is from this tradition that we should draw inspiration to redesign a more legitimate EU.

    EU Institutions EU Member States European Union Integration Leadership

    The Four ‘Classical Federalisms’

    Future of Europe

    22 Oct 2018

  • Since 1998 the Irish border has become invisible, more conduit than barrier between Ireland North and South and at every level. Cross-border trade has expanded exponentially and increasing civic engagement is both entrenching and normalizing the peace process on both sides. The border region is slowly but surely becoming as much a shared civic and political, as a merely functional or economic space. The prospect of a reinstated border threatens that endeavor, concentrating minds in both communities, in government and in Brussels about the malign consequences of what seems to most observers to be an entirely retrograde move.

    In these uncertain times, the likelihood is that the significantly altered status of the post-Brexit border will have far-reaching and mostly negative consequences for future relations on the island of Ireland, and at every level. Brexit threatens a fundamental reversal of a tentative yet tangible peace process, a fundamental downshift in political, commercial and civic relations that means North-South co-operation cannot continue on present terms. Certainly not, if as seems likely, quite different economic and regulatory arrangements will pertain in the island’s respective political jurisdictions, a fact that will become even more conspicuous with a reinstated and formal border.

    Brexit EU Member States Leadership

    Brexit and the Irish question, part two: Brexit’s unintended consequences. Five key challenges

    IN FOCUS

    09 Oct 2018

  • This paper analyses the new European Intervention Initiative (EI2). Proposed by France, the EI2 is an intergovernmental forum outside the EU and NATO for enhancing  military  interactions  between  the  most  able  and  willing  European countries. By seeking to facilitate the development of a European strategic culture, it is an attempt to solve the demand-side problem of European defence cooperation—that is, most European countries’ unwillingness to intervene in crises and to use force when necessary.

    Defence EU Member States Security

    France’s European Intervention Initiative: Towards a Culture of Burden Sharing

    Policy Briefs

    03 Oct 2018

  • The outcome of the 2016 British referendum on EU membership will have significant and lasting consequences. For the United Kingdom and its relations with European neighbours, for the constitutional fabric of the British State and for the EU at a time of uncertainty over the future of the European project. The consequences of this decision will have no greater impact however than on the still-fragile peace process known as the ‘Good Friday’ or Belfast Agreement, negotiated  in  1998  by  parties  representing  Northern  Ireland’s principal cultural communities and the governments of the United Kingdom and the Republic of Ireland. This historic event brought to an end decades of political violence and centuries of sectarian bitterness, or so it was thought at the time. Brexit has thrown into doubt the future of that peace process.

    Brexit Elections EU Member States Leadership

    Brexit and the Irish question, Part one: Ireland’s Slow Road to Peace

    IN FOCUS

    20 Sep 2018

  • It’s the summer torpor that dictates it : nothing juicy to report on the news except the usual columns of chiens écrasés and our ever repeating marronniers: it’s never been hotter, the drought has never been worse, France won the World Cup and will reign on football until the end of time.

    But something is rotten in the Kingdom of Macronie : a close aid of Emmanuel Macron since the days of him being a mere dot on France’s political spectrum, seems to have gone berserk and kicked the living daylights out of some May 1 demonstrators, all this while pretending to be a police officer. It turns out the man has skyrocketed through the ranks of the réserve of the Gendarmerie Nationale (not to be confused with the career militaries, as has been the case on social media where Benalla has been compared to having the same status as the heroic lieutenant-colonel Arnaud Beltrame) and been given considerable privileges simply for being close to the Président.

    As soon as Le Monde had published the videos of Alexandre Benalla attacking the demonstrators, it should have been clear-cut that he needed to be dismissed immediately and brought to justice: this didn’t happen. Instead, we found out that the Elysée had already been aware of the bodyguard’s actions and he had been “mis à pied” at the time, i.e. suspended for 15 days. Since July 18 when the videos were published by Le Monde, the Elysée has barely communicated on the entire affair, hoping to put a lid on it quickly and be done with it.

    All in all, it’s a story that should have been quite ordinary, yet instead took an air of “affaire d’état” and has become the object of a parliamentary inquiry, with the minister of Interior, Gérard Collomb, former mayor of Lyon and close ally of Emmanuel Macron from when he was a member of the Parti Socialiste, audited today at the Assemblée Nationale, along with other governmental and institutional personalities over the next days. Though the Assemblée was supposed to work on a revision of the Constitution to reduce the number of parliamentarians, this affair has now halted all other legislative work.

    But there is something far more daunting about this entire scandal: while the Président has stayed conspicuously silent on the entire matter, his most dangerous opponents at both opposing ends of the French political spectrum, have seized this vacuum to spout their criticism and are reveling in it.

    In what will now go down as one of the most disastrous press conferences ever held in the Assemblée Nationale, Christophe Castaner, the State Secretary of the Prime Minister, whose primary job is to communicate between the government and Parliament, gave Marine Le Pen a golden ticket last Friday to lash at the government and Emmanuel Macron in particular.

    Jean-Luc Mélenchon, leader of the France Insoumise, the party that came 4th in the French presidential elections of 2017, calls it France’s Watergate moment. He declares the Président to be responsible for this entire scandal and therefore has proposed a censorship motion on the government since the Assemblée Nationale has no means of attacking the head of state directly.

    From the party that Emmanuel Macron created, La République en Marche, and which holds a heavy majority in Parliament, not a peep has been heard. Here and there some of its MPs have stated how stunned they are, but nothing more substantial. As usual, they are proving themselves to be loyal soldiers and have done honour to French politicians’ traditional “langue de bois” (a manner of speaking wherein the user is purposefully being vague and ambiguous or pompous so as to divert attention from the issues at stake).

    From the two mainstream parties that used to share power in turn in French politics, we didn’t hear anything weighty either, except perhaps from Laurent Wauquiez, president of Les Républicains, who asked those who work at the Elysée to be “exemplar”. Exactly what the candidate Emmanuel Macron said he would expect from his tenure at the Elysée as well.

    What has this entire scandal shown us? That the comms-savvy team at the Elysée has not exerted damage-control on the scandal when it clearly should have. The vacuum they have let settle has been seized by French democracy’s most dangerous opponents, especially at a time when far-left voters were being lulled into their own summer torpor with the train strikes finally being over, and the Front National being busy fighting its own judicial demons.

    Though this World Cup should have seen Président Macron’s popularity soar, the Benalla affair has put a damper on everyone’s high spirits according to the latest BVA opinion poll. Instead, we can’t help thinking Président Macron did a Lloris. In other words: this won’t be detrimental to the Macron presidency but it does make it look rather clumsy. 

    Photo by Stefan Steinbauer on Unsplash
    Anna van Oeveren EU Member States Leadership

    Anna van Oeveren

    Benalla, or why France has les Bleus

    Blog

    23 Jul 2018

  • When Donald J. Trump was elected US President in November 2016, some considered it necessary for Europe to start looking for new allies. As a result, some advocated for much stronger cooperation with China, especially in economic terms.

    Yet, positive expectations for the future development of Europe-China relations quickly morphed into concerns, mainly due to the massive scale of Chinese investments across Europe in all sectors. China has bought or invested in assets amounting to at least 318 billion dollars (272 billion euros) over the past 10 years.

    China has also expanded its cultural influence via the Confucius Institutes—a growing network of government affiliated educational organisations promoting Chinese language and culture—and by financing China studies and academic chairs in different European universities.

    Until now, Chinese influence has been seen by the public as less problematic than for example the influence of Russia. However, according to Thorsten Benner and Kristin Shi-Kupfter, China seeks to weaken western unity with Europe and across the Atlantic and pushes to create a positive global perception of China’s political and economic system as viable alternative to liberal democracies.

    The pressing question is, how will China use its influence in Europe while its economic power continues to grow? Is it a possibility that China will resort to more aggressive tactics?

    For us, the case of China’s relations with Australia and New Zealand, and the concerns those two countries have vis-à-vis Beijing, can give an indication of what might come. Compared to Europe, Australia’s and New Zealand’s relations with China are much deeper, richer in events and history.  Unfortunately, however, their relations with China have recently become characterised by ever deepening suspicion and concern.

    Australia’s concerns

    The Australian Security Intelligence Organisation (ASIO), the country’s domestic intelligence agency, wrote in its annual report to the Australian parliament that foreign governments are trying to extend their influence in Australian society, posing “a threat to our sovereignty, the integrity of our national institutions, and the exercise of our citizens rights.” In Australia and New Zealand, the Chinese government has gained influence in political systems, universities and media.

    A particular concern are businesspeople with links to Beijing who promote pro-China views and donate millions to labour and the liberals—the country’s two major political parties. An analysis by Melbourne Law School’s Dollars and Democracy database states that between 2000 and 2016, about 80% of foreign political donations to Australia’s parties came from China.

    ASIO identified at least AUS$ 6.7 million in donations to the two main political parties from two Chinese billionaires close to Beijing. Also, ASIO has identified 10 political candidates at various levels of government with strong ties to Beijing and the United Front.The United Front is part of China’s ‘soft power’ operation which President Xi Jinping has made one of the paramount objectives of his administration and is estimated to cost China between $10 and $12 billion annually.

    Chinese influence is also perceptible in universities and think-tanks. Mr. Huang Xiangmo, one of the billionaires who allegedly donated money to Australian politicians, helped fund a think-tank focused on China at University of Technology Sydney and he was chairman of the Australian Council for the Peaceful Reunification of China, an organisation backed by China’s United Front. He was also chairman of the Australian-China Relations Institute advisory board. He resigned when it was questioned by academics as to whether it was becoming a mouthpiece for the United Front, for Beijing’s propaganda.

    In addition, China’s state and security forces have reportedly engaged in a campaign to monitor Chinese nationals, including many students. Thus, ASIO is concerned about foreign interference in Australian Universities.

    As a result, new laws have been drafted in Australia, designed to restrict the potential influence of foreign governments and to enforce greater transparency, namely aimed at the Chinese government i.e. Chinese Communist party.

    New Zealand’s experience

    In New Zealand the developments have been very similar. Anne-Marie Brady from University of Canterbury, released a report which received a lot of publicity, describing with many examples how China has gained influence in the New Zealand’s society, such as political donations.

    Maybe the most media attention was given to a case in New Zealand in 2017, when a successful politician in foreign affairs, Mr. Jian Yang, was investigated for his background in Chinese military intelligence, which involved 15 years of training and work which he managed to conceal.

    For the US, China’s influence in New Zealand is a concern, especially with regards to Wellington’s reactions to China’s territorial claims in the South China Sea. On 7 May this year, former US presidential candidate Hillary Clinton spoke in Auckland, warning of increasing Chinese influence.

    China’s future influence in Europe

    The level of concern in both Australia and New Zealand’s state institutions resembles the concern most Europeans have today for Russia. Also, despite the wide public debate in Australia and New Zealand about Chinese influence, China continues to use its tactics.

    Australia’s and New Zealand’s experience shows that better transparency is needed as it comes to foreign influence especially related to the core processes of European societies; elections and voting periods.

    China is growing its economic influence in Europe. Its economic power is not yet massive, but it is increasing rapidly. Europe consists of open societies like Australia which makes them easy to target, easy to penetrate.

    Which forms will China’s influence take when it really starts to gain economic power and leverage in Europe? China’s advancement of its interest and successful penetration of Australian and New Zealand societies might give us an answer. Chinese tactics in Europe may become more assertive, aiming for greater impact and so become cause for greater concern.

    Tomi Huhtanen EU Member States Foreign Policy Globalisation

    Tomi Huhtanen

    China’s rise in Europe: lessons learned from Australia and New Zealand

    Blog

    01 Jun 2018

  • Populists love blaming the EU for everything that goes wrong in our societies, proclaiming that a return to a Europe made up of nation states is the only path forward. But when doing so, they should go beyond the ideology and look at the real consequences of such a shift. They should talk about how this will end open trade as we know it, how this will cost hundreds of thousands of jobs across the EU and how it will make the EU less safe.

    The European “super state” with its soulless bureaucracy and its ivory tower is an easy target cliché for those looking for a scapegoat. But people using that image swiftly find themselves in an awkward bind. If they say that citizens need a quid pro quo when paying taxes and only want their taxes to be used to build roads and bridges, they should also say that more often than not roads and bridges are payed for with EU funds. If they say that EU taxes would be an atrocity, they should stop saying that the EU’s external borders remain unprotected.

    So let’s speak the truth about the EU. The truth is that it wasn’t established by soulless bureaucrats but by people like Adenauer and Schuman and Spaak. Statesmen who had personally witnessed the horror and ruin of neighbours going to war with one another.

    Populists love blaming the EU for everything that goes wrong in our societies, proclaiming that a return to a Europe made up of nation states is the only path forward. But when doing so, they should go beyond the ideology and look at the real consequences of such a shift. They should talk about how this will end open trade as we know it, how this will cost hundreds of thousands of jobs across the EU and how it will make the EU less safe.

    The European “super state” with its soulless bureaucracy and its ivory tower is an easy target cliché for those looking for a scapegoat. But people using that image swiftly find themselves in an awkward bind. If they say that citizens need a quid pro quo when paying taxes and only want their taxes to be used to build roads and bridges, they should also say that more often than not roads and bridges are payed for with EU funds. If they say that EU taxes would be an atrocity, they should stop saying that the EU’s external borders remain unprotected.

    So let’s speak the truth about the EU. The truth is that it wasn’t established by soulless bureaucrats but by people like Adenauer and Schuman and Spaak. Statesmen who had personally witnessed the horror and ruin of neighbours going to war with one another.

    A strong European Union  benefits every European citizen. Not in spite of, but because of its large scale.

    The EU started as a project to  safeguard peace across the continent. But over the years it became so much more, it became an ever-closer union. A Union of unprecedented economic and social welfare and shared values. Christian democrats have been the driving force behind that evolution, and the EPP remains the driving force to this day.

    We continue to ensure that the European Union is being democratically governed. Through the member states in the Council, through the representatives elected to the European Parliament by our people and through Commissioners who are delegated by the governments of their home nation.

    A strong European Union  benefits every European citizen. Not in spite of, but because of its large scale. We live in an era of fundamental geopolitical and economic shifts. The reality of today, the outside world in turmoil scares people, which is understandable. But capitalizing on those fears for electoral reasons and making protectionist pleas for a return to separate, individual nation states with closed borders, is reprehensible. In a world that is dominated by competing superpowers, even countries like France and Germany are small players.

    The European Union, representing 25% of the global economy, must speak with one voice on the global stage. It is the only way to defend our interests. Only in the Bible does David triumph over Goliath. If US President Donald Trump hasn’t yet implemented import tariffs on European steel, it is because the EU is taken seriously as a large trade block. I am sure he’d much rather negotiate directly and separately with Belgium or Italy or Hungary.

    Is this a plea for that infamous European “super state”? No, of course it isn’t. Our citizens aren’t interested in those kinds of institutional theologies that all too often dominate the debate on Europe. They don’t care about the colour of the cat, as long as it catches mice.

    Which mice should Europe catch?

    The EU is an economic success story. The internal market brings growth and prosperity, especially so for a very open economy such as Belgium’s. But the benefits and the added value become even clearer when things go wrong. With one member state preparing to leave the EU, the dark economic picture is getting clearer: for Belgium alone this may cost 2.2 billion euros in tariffs as well as the loss of 42,000 jobs.

    Yet I do not believe that Brexit will be the beginning of the end of the European Union. On the contrary, we already see that Brexit is bringing the remaining 27 members closer together.

    So, the European story is unfinished. We should get on with the creation of an Energy Union and a Digital Union because this is where tomorrow’s economic challenges lie. At the same time, we should recognize that Europe is more than a market. The European Union should protect its citizens. It should provide security and a level playing field.


    So no, we don’t find ourselves all of a sudden in a European demos that replaces the national identity. If nothing else, because our identity cannot be defined one-dimensionally.

    Under the guidance of Commissioner Thyssen and with the active support of the Belgian Government, we have taken significant steps towards a stronger social Europe and in the fight against social dumping. Equal pay for equal work in the same place has become a reality. We should build on this: before the European elections of 2019 we should reach an agreement on the creation of a European Labour Authority and on the Work-Life Balance Directive.

    In addition, the Union should continue its work in shaping a coherent migration policy and  better protection of our external borders. A European Union that is built on the rule of law and shared values owes it to itself to provide decent and humane assistance to refugees. We can manage this. But we cannot welcome the entire world to Europe.

    This is why we should focus more strongly on timely, quality assistance in the immediate vicinity of conflicts. And we need to know who is entering the EU. Controls at the European external borders need to be strengthened. That is why I plead for a further reinforcing of the European Coast and Border Guard and an increase in EU Border Guards from 1,200 to 10,000.

    Who will foot the bill?

    The EU Budget has for years amounted to more or less 1% of GNI. So, just 1% of our overall income goes to the EU; the other 99% is spent on other things. This is the order of magnitude and it will not change significantly. So let us not turn the 1% threshold into an obsession. I prefer 1.1% spent well, over 0.9% spent poorly. The proposal of the European Commission for the post-2020 Multiannual Financial Framework seems a good basis to me.

    I do not welcome every aspect of course: in the context of Brexit and increasing pressure on Customs services in frontline countries like Belgium, the proposed decrease of the retention of Customs collection costs from 20% to 10% is simply unacceptable. But I also find a lot of interesting ideas in this future-oriented budget: the increase in spending on innovation, investments in human capital and the doubling of the Erasmus+ program.

    And yes, new own resources should be a possibility in my view. The proposal of a tax on non-recycled plastic waste is a creative proposal that can help the EU achieve its climate and environmental goals and create a better world for our children and grandchildren.  

    The limits of the nation state

    So no, we don’t find ourselves all of a sudden in a European demos that replaces the national identity. If nothing else, because our identity cannot be defined one-dimensionally. The notion that we cannot be Flemish if we want to be Belgian, or Belgian if we want to be European, is completely outdated.

    Today’s reality is that we have a multi-layered identity. We can feel Flemish, Belgian and European at the same time. Because in all of those identities we find a common past and we see a joint future. And that multi-layered identity requires multilevel governance, with real competencies and the necessary striking force. European democracy coincides with local democracy. It is the only way the European Union can strengthen our nations and vice versa.

    Kris Peeters Brexit EU Institutions EU Member States European Union Euroscepticism

    Kris Peeters

    Let’s speak the truth about the European Union

    Blog

    29 May 2018

  • Our think tank is celebrating its tenth birthday! It started off small, with just three people on board. Today we have a team of over 20 talented and dynamic individuals at our Brussels headquarters, and we cooperate with more than 40 member foundations and partner organisations across Europe. Every year we organise over 100 events. In this way we have developed a platform for centre–right decision-makers, experts and thinkers to discuss and exchange views on current issues and to debate proposals to address the foremost challenges facing Europe.

    EU Member States European People's Party European Union

    Activity Report 2017

    Activity Report

    09 Apr 2018

  • Many of the outcomes of the March 4 Italian parliamentary elections were highly predictable and, indeed, correctly foreseen. However, the extent to which this vote marked a radical request for change and is a turning point in Italian politics comes – if not as a surprise – as a confrontation with reality. It is now time to make sense of this new reality and try to analyse what is happening in Italy. Here are three points from which to start the analysis.

    1. Almost 55% of Italians voted for populist, anti-establishment and euro-sceptic forces

    Does this mean that Italian people are radicalising? Hopefully not. Surely, there is a certain degree of anger in the air, but extremism remains a marginal, yet dangerous phenomenon. Actually, many of those who expressed a “protest vote” in this election belong to the so-called “moderate electorate”.

    Middle-class households, entrepreneurs, but also factory workers, unemployed people of different ages and social status and young people deprived of opportunities in a country which, unfortunately, seems to have increasingly less to offer. Put simply, these are ordinary people. They feel betrayed and are disappointed in the parties which they traditionally voted for and are hoping to see their conditions improve.

    The Five Star Movement, the League and Brothers of Italy (a smaller far-right party belonging to the centre-right coalition) travelled across the country in recent months and years. They met with people and they made them feel heard. They showed empathy to their problems and offered simple (if not unfeasible) solutions.

    In the South of Italy, the Five Star Movement presented a platform that prioritised addressing the regions high levels of poverty, unemployment, and corruption. They promised more jobs, a tough approach to corruption and privileges, as well as to introduce a universal basic income that gave everybody the means to conduct a decent life.

    They met with people and they made them feel heard. They showed empathy to their problems and offered simple (if not unfeasible) solutions.

    In the most productive regions of Italy, especially the North, entrepreneurs are frustrated by bureaucratic burdens and an unsustainable level of taxation. Here, the League proposed a flat tax of 15% in conjunction with a commitment to abolish many of the existing burdensome administrative constraints.

    Nationwide, for many years Italy has struggled with issues surrounding migration and security, and the perception of a lack of support from the European Union has resulted in increases in euro-scepticism and anti-European sentiment. There is also an increasingly widespread belief that, all in all, Italian people are not better off within the European Union, which is being criticised for imposing too many constraints without sufficient benefits and solidarity in return.

    Under these conditions, it is quite understandable how much the nationalistic recipes of populist parties and their promises to take back control over the country’s policies resonated amongst the ordinary people. Are all of the above promises deliverable? Probably not. However, they included what many Italians needed to hear.

    In the most productive regions, especially the North, entrepreneurs are frustrated by bureaucratic burdens and an unsustainable level of taxation. 

    Hope for radical change and concern for the present and future conditions mobilized a large majority of the 73% of the electorate that voted. On the one hand, the Five Star Movement alone got more than 32% of the votes, becoming the largest political force in Italy.

    Another reason for their success was the reassuring tones of its 31-year-old leader Luigi Di Maio. He managed to convince the relative majority of Italian voters to trust the M5S, in spite of emerging scandals surrounding its members and its multiple failures in holding concrete administrative responsibilities (such as the messy situation in Rome).

    On the other hand, the League of Matteo Salvini reached around 18%, evolving from a regional movement – the former “Northern” League – to a national party. Brothers of Italy scored around 4%. The three parties – in particular the M5S and the League – represent different types of populism, which makes Italy an interesting case.

    2. Unsurprisingly, the big success of populist movements was coupled with the worst results ever of the two mainstream parties

    Within the centre-right – which came out of the elections as the winning coalition with around 37% of the vote – the League was larger than Berlusconi’s party for the first time, and Salvini is now laying claim to the leadership of the coalition. Such a result would make it more difficult for the moderate elements of the centre-right to avoid far-right shifts in its internal balances. This is especially true on subjects like migration, security and commitment to the European Union and the Eurozone.

    On the other side of the political spectrum, Matteo Renzi’s Democratic Party fell from the 40% achieved in the 2014 European Elections to less than 20%. A massive failure which is worse than anybody (including Renzi himself) could have ever imagined and which is coherent with the general trend that many centre-left, social-democrat parties are currently experiencing across Europe and beyond.

    What is the future of mainstream parties in general? Italy is not alone in dealing with this dilemma. 

    3. Besides the rise of populism and the crisis of traditional parties, the current Italian electoral law delivered a hung Parliament with no clear solutions 

    Indeed, at present neither the M5S nor the centre-right coalition have the majority required for forming a stable government (estimated to 40%). With so much political fragmentation, it was clear from the beginning that such a system would have not helped in delivering a clear outcome.

    What’s next? Nobody knows. According to the Italian Constitution, the situation is now in the hands of the President of the Republic, Sergio Mattarella, who will meet with all the parties and see if there is a viable solution or if new elections must be called. Among many uncertainties, the only certainty is that both the Five Star Movement – as the winning party – and the League – as the major shareholder in the winning centre-right coalition – will play an important role in what is expected to be a long process of negotiations. 

    Indeed, Italian voters sent a very clear message that Mattarella will have to take into consideration in the exercise of his constitutional powers. Given the absence of a clear winner and majority, it is possible that the President of the Republic, before taking any decision, decides to wait at least until the election of the Presidents of the two Chambers – scheduled on March 23 – and see if there is clear evidence of a possible stable majority in the Parliament.

    Everything will depend on the availability of the main players to make compromises and on their ability to put together a wider majority.

    The whole process will probably take some time. In this sense, Italy is facing political challenges that other European democracies have also been facing.  It is too early to make more precise predictions and, at this stage, any speculations on possible scenarios could easily prove wrong. Everything will depend on the availability of the main players to make compromises and on their ability to put together a wider majority.

    Both the M5S and the League seem open to dialogue: yet, they remain firm in their positions and they cannot take the risk of betraying their respective electorate by consenting to any “inciucio” (deal done under the table, particularly with rivals). The margin of manoeuvre is very narrow. European and international partners are watching Italian developments carefully.

    Italy could come up with a solution which keeps populist initiatives under rational control. On the other hand, a deeper focus on national interest and a changed attitude towards external partners could also emerge. Is this the beginning of Italy’s “Third Republic”? It seems that the transition has begun.  

    Margherita Movarelli Centre-Right Elections EU Member States Euroscepticism Populism

    Margherita Movarelli

    Three points to make sense of the Italian elections outcome

    Blog

    07 Mar 2018

  • My fingers are shivering under the bitingly-cold Brussels weather as I check my phone on my way to work. It’s a text message from a former colleague and journalist, and it freezes me in my tracks. Investigative journalist Ján Kuciak and his fiancée Martina Kušnírová have been murdered in Slovakia. A premeditated murder, execution style, apparently related to his work.

    In one winter morning Slovakia has been set back to where it had once been: to the dismal nineteen nineties. I suddenly feel the same feeling of nausea that overwhelmed me in 1996 when, after a forceful abduction abroad of the then-President’s son, ex-police officer Robert Remiáš was assassinated just as he prepared to give a deposition about the matter on which he possessed vital information.

    They planted a car bomb in his vehicle. They. Although it has never been proven who was behind his murder, from the very beginning the evidence pointed to the involvement of the Slovak Secret Service.

    These murders share a common story: both journalists vigorously explored the signs of corruption, for which they paid the ultimate price.

    I did not know Ján Kuciak personally. According to the media, he was a young investigative journalist who probed into and reported on tax frauds involving senior business figures with links to the representatives of the current government, especially the Minister of the Interior. He wrote about corruption cases associated with the use of EU funds, scandals of the party in power, and covered the Panama Papers case.

    That he had filed a criminal complaint in September alleging threats indicates that he was on the right track. However, the police repeatedly failed to act on his concerns before finally playing them down. Had they acted differently, it is likely that this young couple would be alive today. His violent death makes me look at and perceive the work of investigative journalists, several of whom were my university classmates, in an altogether different light.

    In the space of a few months, Ján Kuciak became the second journalist to be murdered in the EU, following the murder of Maltese journalist Daphne Caruana Galizia. These murders share a common story: both journalists vigorously explored the signs of corruption, for which they paid the ultimate price.

    According to a Journalists without Borders report, Slovakia is ranked as a country with a high degree of press freedom. However, in recent years, that freedom as well as the state of democracy in Slovakia and neighbouring countries has been jeopardised. In November 2016, when the media questioned Slovak Prime Minster Robert Fico about the state of corruption and its links to government, he had no qualms about publicly labelling them as “dirty Slovak prostitutes”.

    This official denigration of the status of journalists was repeated in the Czech Republic when President Zeman spoke about the need to “liquidate” journalists. This was said in public during a meeting with Russian President Vladimir Putin, although his spokesman did later claim that it was “just a joke”.

    These paragraphs offer just a brief outline into the decreasing press freedoms in this region, a region where the politicians in power seek to build a New Europe.

    In Poland, the government recently put forward a bill that aims to limit foreign ownership of Polish media, a move that has been viewed as an attempt to hinder the work of media outlets that dare to criticise the government. As well as his plan to “reform” the Polish judiciary, Kaczyński has made no secret of his desire to deconcentrate the ownership of Polish media.

    This regional trend of curtailing press freedoms has potentially been most visible in Hungary. By establishing a “Commission” of select journalists (really a guild), Viktor Orbán has taken actions to make his dream of a compliant media a reality. Here journalists are given significant tax reliefs to encourage them to join this Commission and many publishers feel pressured to join in order to safeguard their operations.

    This means that journalists favours will be purchased by granting them certain privileges while existential challenges and threats will be created for those reluctant to adhere to the policy of uncritical commentary of the work of Viktor Orbán.

    These paragraphs offer just a brief outline into the decreasing press freedoms in this region, a region where the politicians in power seek to build a New Europe. The murder of a young journalist and his fiancée paint a stark picture of a democracy that is moving towards crisis point. I feel saddened and frightened, but also ashamed.

    I am ashamed because, in recent years, the leaders of these countries have acted strategically to diminish the space of democracy and weaken society’s sensitivity to corruption scandals. Freedom of speech and an independent police, judiciary, and prosecution are fundamental pillars of democracy and in this region they are being eroded.

    While these post-communist countries are still experiencing the early days of democracy, the response to these developments will tell a lot about the direction of their democratic trajectory. If these countries are to one day become mature democracies these limitations on press freedoms must be stopped and those behind the murder of Ján Kuciak must be brought to justice in a courtroom free from political interference by independent jurors.

    Viktória Jančošeková Democracy Ethics EU Member States

    Viktória Jančošeková

    A chilling morning: the Ján Kuciak case and press freedom in the Visegrad countries

    Blog

    27 Feb 2018

  • Successful systemic reforms – reforms that put an entire country on a higher trajectory of development – have become the Holy Grail of modern democratic politics. All politicians of some ambition claim to be pursuing them, but few manage to secure any during their time in office.

    In recent decades, successful reforms have in fact been a rarity and a riddle in western democracies: they seldom happen and we do not exactly know why they succeed. For one country that made it – for example Thatcher’s Britain – one can find several that failed – from France to Italy and Greece.

    Thanks to Nils Karlson’s book Statecraft and Liberal Reform in Advanced Democracies, published by Palgrave Macmillan this year, successful reforms will be less of a riddle and perhaps less of a rarity too.

    Karlson, the Founding President and CEO of the Ratio Institute in Stockholm and an Associate Professor at Uppsala University in Sweden, had first-hand exposure to successful structural transformations in his own country when he served as a public sector manager under Prime Minister Carl Bildt.

    Successful systemic reforms have become the Holy Grail of modern democratic politics.

    This was the period when Sweden transformed from an economy plagued by low productivity, heavy regulation and exorbitant taxes into an open, competitive one with high productivity, deregulated markets and sound public finances.

    From an in-depth comparison between the Swedish experience and the Australian one – another success story of reform – the author develops the best theory yet on how to understand – and pursue – reforms.

    Modern statecraft – the art of governing a country well and of promoting reform – requires that there is an opening for action but most crucially that elites know what to do and how to do it. The opening is usually created by changing economic and social conditions that show the inadequacy of existing arrangements.

    By the 1970s, for example, interventionist policies had created a state of economic sclerosis and social stalemate in Britain and Sweden. Something had to be done, but what exactly? At this juncture, ideas take center stage.

    Jean Claude Juncker’s famous quip that ‘we all know what to do, but we don’t know how to get re-elected once we have done it’ shows way too much confidence in politicians’ skills.

    Politicians are consumers, not producers, of ideas.

    Building on an intuition that had already surfaced in the thinking of Friedrich Hayek – the great liberal economist and social theorist – Karlson explains that novel ideas for policy changes must have been developed and strategically promoted for policy-makers to know what to do when the occasion arises.

    Politicians are consumers, not producers, of ideas. All available examples show that policy entrepreneurs in universities, think tanks and strategically placed institutions play a key role in developing ideas for policy changes and in finding political champions to promote them.

    Without these people, beneficial change does not normally happen. In the British case, a policy entrepreneur such as Anthony Fisher and an organisation such as the Institute of Economic Affairs come to mind.

    This process of elaborating and spreading new ideas can be decades-long – it was in the cases treated in the book. Besides, its success is no guarantee of welfare-enhancing reforms.

    The author explains that policy-makers who have embraced ideas for change need to overcome powerful obstacles on the road to reform, from special interests and public goods traps to public opinion and cognitive biases.

    To be successful, they need to know how to do what they deem necessary, which in practice means mastering and using three major reform strategies: Popperian, Kuhnian and Machiavellian.

    The first are based on rational argumentation, the second on changing the frame of discussions, the third on shrewdness, divide-and-rule and scapegoating. All successful reformers seem to have used some combination of the three, depending on circumstances. 

    The book does a good job explaining why major policy changes succeed in advanced democratic welfare states. It also offers a promising framework to understand why they often fail. In France, Italy and Greece, for example, policy entrepreneurs are mostly absent, and think tanks relatively underdeveloped.

    To be successful means mastering and using three major reform strategies: Popperian, Kuhnian and Machiavellian. 

    Elites are traditionally absorbed by the state bureaucracy, which acts as a bulwark of conservatism and discourages any reform. In order to prove the robustness of his theory, Karlson will have to test it with more countries, most interestingly those who tried and failed to reform. The theory may also benefit from placing higher emphasis on institutional obstacles to reform, which are somewhat neglected.

    When a country has dysfunctional institutions, in addition to ineffective economic and social policies, reforms may be blocked even if all the conditions identified by Karlson are in place. The Italian case comes to mind again here, with successive reformers – most lately Renzi – worn out by failed attempts to modernise an ineffective constitution that makes special interests all-powerful.

    All in all this is an excellent contribution that scholars, practitioners and politicians with reformist ambitions would do well to read carefully. At a time when the future of Europe and EU reform are the talks of the town, it is an essential read for us in the Brussels bubble too.

    It should help think tanks and political foundations better understand how decisive our role in developing and spreading novel ideas for EU reform can be in the current context. And it should induce us to upgrade our ambitions from playing a mostly supporting role to becoming drivers of change that actively shape narratives and policies.  

    Federico Ottavio Reho Economy EU Member States Macroeconomics

    Federico Ottavio Reho

    Even advanced democracies need reforming

    Blog

    15 Feb 2018

  • During the 2018 February plenary session, the European Parliament voted on its future composition after the departure of the United Kingdom from the EU. Members of the European Parliament (MEPs) decided to redistribute 27 of the current 73 UK seats among several EU member states which have been previously under-represented. The full-list of the proposed allocations can be found here.

    The house also debated whether some of the remaining available seats should be taken by MEPs elected from an EU-wide electoral constituency and through a ‘transnational list’ which would complement the national lists in the 2019 European elections. The European Parliament (EP) eventually voted against the proposal for transnational lists.

    What happens to the UK seats if there is no actual Brexit?

    The current 73 UK MEPs have been democratically elected for a full mandate until May 2019. These seats will not be available to the UK after the withdrawal from the EU becomes legally effective (expected on 29 March 2019). The EP proposed text specifies that in case the UK is still a member of the EU at the time of the 2019 elections these changes will not take place.

    The idea of transnational lists is great because I would be able to vote for candidates who would represent the European Union interests, correct?

    Not really. This is already the case with the traditionally elected MEPs who are sworn to represent the European Union’s interests while also remaining accountable to their national constituencies. Current MEPs sit in pan-European political families which are at the centre of the everyday work of the Parliament.

    The political engagement of every MEP within his European political family is key for his successful committee and legislative file work. Historically, most traditionally elected MEPs have guarded the Union interest and advanced pro-integration legislation whilst serving as a link between the national electorate and the supranational institution. Why destroy this link with transnational MEPs?

    But don’t you want to see a new type of Parliamentarians?

    Transnational MEPs would actually have to choose a European political family to align with and sit together with the ‘traditional’ ones or become independent. These ‘new’ Parliamentarians could demand additional legitimacy from their political family due to their allegedly upgraded mandate but would essentially have exactly the same rights and obligations as a traditional MEP. Becoming independent would leave them with limited speaking time, visibility, resources and overall ability to influence legislation which would be the exact opposite of the ideal pan-European delegate.

    What about making the MEPs more visible and strengthening the connection between voters and elected Members?

    This is precisely why having transnational lists would be a bad idea. The question can be answered with a series of open questions. How would a Member who has been elected with a different number of votes from different member states be held accountable? With which national electorate would they spend time during the weeks designated for constituency work?

    In what language would they communicate to their electorate? If the delegate eventually opens offices in his/her native member state and interacts with a local audience, what would be the point of having a transnational mandate?

    The old proverb “One who is everywhere is nowhere” would apply fully in this case. 

    Why not have a truly European race for votes in a European-wide constituency?

    The European-wide constituency was previously proposed in 2015 as part of the reform to the Electoral law of the EU. The file is still pending in the Council of the EU which is effectively stopping its development because of a lack of member state support. Even if the EP had voted in favour of transnational lists for 2019, this probably wouldn`t have been implemented in practice as the decision requires the unanimous approval of European heads of state or government (European Council).

    Having a single constituency for the 2019 elections which is based on proportional representation remains practically impossible. Such changes would have to be agreed beforehand with national/regional parliaments and implemented in national electoral laws on very short notice. Practical issues remain regarding the feasibility of hundreds of candidates campaigning across the EU in a 30-day time period to audiences with diverse political, linguistic and cultural backgrounds.

    Globally there is no country or federation with such a huge number of eligible voters which produces proportionally elected Members from a single constituency. One might argue that the Spitzenkandidat process brings about an informal EU-wide constituency which actually works because it produces a single winner (see below).

    So I guess being against transnational lists makes you anti-European?

    Quite the contrary. Rushing in transnational lists in 15 months would produce an unbalanced process which could achieve an anti-European effect. The system would naturally give an advantage to bigger member states as they would cast the biggest number of ballots and most likely produce additional ‘bonus’ seats for Germany, Spain, Italy and France.

    An attempt to balance such a system with national, gender and maximum member quotas would take a lot of time and additionally cause party/voter frustration. Such a hasty top-down decision would backfire and be seen as an elite-driven initiative for institutional legitimacy which would further discourage voters and cement the `second order` status EP elections.

    The short time-frame for actual campaigning and communicating such a change would create very polarized voter groups (convinced anti-EU and strong pro-federalist segments) and ultimately produce extremely diverging MEPs who wouldn`t represent true transnational sentiment.

    How about engaging more EU citizens and contributing to the formation of a European demos? 

    The million-euro question about active citizen engagement on a regional, national and European level remains indeed open. However, we shouldn`t expect supranational institutions to be the only inventors and promoters of a European identity which may turn out to be artificial. The European Citizens` Initiative has been operational for more than 5 years and has produced disappointing results. This is a good example of how a top-down idea promising citizen involvement defeats its own purpose.

    The sensible goal for the 2019 elections would be to promote the lead candidate process (Spitzenkandidat) in which the European political families campaign their manifestos along with their leading candidate who they nominate for President of the European Commission. This is a workable solution which de facto produces a European-wide constituency as it is best suited to present a single winner from an extremely large number of votes.

    The 2014 EP elections were the first in which the new Commission president was elected with the support of the winning party and not appointed after a high-level political compromise behind closed doors. This achievement essentially gives European political parties a campaign face and makes the small but necessary step for politicizing EP election campaigns further. 

    Dimitar Lilkov Brexit Elections EU Institutions EU Member States European Union Political Parties

    Dimitar Lilkov

    Q&A: why introducing transnational lists in the 2019 European elections is a bad idea

    Blog

    15 Feb 2018

  • Media headlines seem to have given much larger attention to the bailout programme in Greece than to those of most other countries. But Greece’s experience with economic adjustment is in many ways an outlier, complicated by the election of the radical-left government of Tsipras.

    Cyprus offers the interesting example of an economy saved with the help of economic adjustment and responsible reforms. Cyprus under centre-right leadership seems to be a rags-to-riches story after being shut out of financial markets only six years ago.

    During the 2000s Cyprus registered strong growth driven by buoyant domestic demand according to a European Commission report. On average, Cyprus’ real GDP grew at a rate of 2.75% between 2000 and 2010 compared to the 1.4% of the euro area for the same timeframe.

    The country enjoyed high employment rates, low inflation rates and rising real disposable income. This led to real convergence with the stronger economies in the European Union. Apart from domestic demand, Cyprus’ accession to the European Union in 2004 and its joining the euro area in 2008 contributed to this growth by boosting investor confidence.

    While Cyprus resembles other countries in the euro area most affected by the crisis, it represents a success story in crisis management.

    However, this positive image was underpinned by economic vulnerabilities and imbalances due to the mismanagement of the public finances. Notably, Cyprus ran current account deficits averaging 6.9% of GDP for approximately one decade during EU accession and entry to the euro area. In order to finance its current account deficit, Cyprus relied on foreign direct investment, which provided little added value to the economy.

    Furthermore, the public sector had grown extensively in the 2000s, taxpayer compliance was low, and total government expenditure as a share of GDP increased. Additionally, the banking sector was vulnerable because of inadequate prudential supervision and because of its openness toward Greece.

    When the financial crisis and subsequent euro crisis hit, the Cypriot banking sector was severely impacted. Cyprus reached a 6.3% budget deficit and gross debt rose sharply to 85.8% of GDP and subsequently going over 100%. Cyprus was shut out of financial markets for 18 months starting in mid-2011.

    In order to adjust its economy, Cyprus agreed a bailout programme and undertook comprehensive structural reforms under centre-right President Anastasiades. The implementation of the bailout programme of €10 billion (56% of Cypriot GDP) took place between 2013 and 2016.

    It was one of the largest sovereign bailouts in history. The bailout programme targeted Cypriot banks and involved a severe austerity programme (cuts to public spending, tax increases, and privatisation of semi-government organisations).

    The reform to the banking sector, which saw Cyprus’ second-largest bank shut down, was received negatively by the public as it involved losses to all stakeholders in the banking sector, especially bondholders and depositors.

    The government in Cyprus was determined in its response to the crisis and Cypriots were stoic in their resolve to see the reforms through. Apart from minor unrest toward the beginning of 2013, there were little protests and no riots against the austerity programme.

    While Cyprus resembles other countries in the euro area most affected by the crisis, it represents a success story in crisis management.

    The performance of Cyprus is a clear example of the positive link between a bailout programme for a country in deep crisis and sustainable economic activity. 

    The country exited the bailout programme on track in 2016 due to ambitious and consistent implementation of necessary reforms by the centre-right government led by President Anastasiades.

    Statistical data from Eurostat supports the positive contribution government policy since 2013 has made to the country’s recovery. Cyprus ranks among the top ten countries in the European Union on key financial indicators.

    Data for the third quarter of 2017 shows a 0.9% increase in GDP over the previous quarter and a 3.9% increase over 2016. Employment has increased by 0.7% in the third quarter when compared to the second and by 3.5% when compared to 2016.

    Equally, Cyprus registered the fifth largest year-on-year decrease in unemployment in the European Union, from 13.1% in 2016 to 11.0% in the third quarter of 2017.

    Cyprus had the largest year-on-year drop in government debt to GDP ratio (7.4%) in the EU in the third quarter of 2017. According to a European Commission forecast, growth is expected to remain strong in 2018 and 2019 coupled with a strong labour market and modest inflation.

    The economy of Cyprus has outperformed the government’s budgetary targets, and government debt is likely to fall below 100% of GDP in 2019.

    The academic literature on public administration reform often emphasises the difficulty of agreeing to and implementing reforms as well as of deciding whether or not the intended reforms had the intended outcome.

    In this respect, the performance of Cyprus is a clear example of the positive link between a bailout programme for a country in deep crisis and sustainable economic activity. Notably, it is a victory for the centre-right, which has once more shown its ability to deliver results in highly challenging circumstances.

    Even so, the Cypriot economy should not rest on its laurels even if it has registered a significant improvement. A forecast by Oxford Economics warns that reform is still necessary as the ‘legacy of the 2012-2013 crisis can still be seen in the banking sector’.

    Further work on restructuring non-performing loans and improving public finances is required in order for the positive forecasts to become a reality. Rags-to-riches stories are popular, but so are riches-to-rags. 

    Andrei Moraru Centre-Right Crisis Economy EU Member States Macroeconomics

    Andrei Moraru

    Cyprus: from rags to riches?

    Blog

    01 Jan 2018

  • Regional cooperation is mutually beneficial collaboration between neighbouring countries. This holds regardless of whether it is a matter of cooperation between the Benelux countries, the Nordic–Baltic states, France and Germany, or the Visegrád countries. The last-mentioned countries’ dismissive attitude to tackling the migration crisis has thrust them into the limelight.

    The most recent cooperative forums in the Central Eastern Europe region, such as the Slavkov Triangle and the Three Seas Initiative, evidence a new dynamic and a regrouping of forces on the basis of national interests and EU themes. Western and Eastern Europe have different approaches to the most pressing challenges, such as migration.

    These differences have caused deep divisions between their respective leaders. However, the disagreements on the migration issue and the future of the EU notwithstanding, regional cooperation among the Central and Eastern European countries remains valuable in areas that include the integration process, security and defence.

    Read the full article in the December 2017 issue of the European View, the Martens Centre policy journal.

    Viktória Jančošeková EU Member States Leadership Migration

    Viktória Jančošeková

    Regional cooperation in Central and Eastern Europe and its implications for the EU

    Blog

    14 Dec 2017


  • Tax policy is central to national democratic policy making, and tax issues feature more and more prominently in EU level discussions too.

    For citizens – who are also taxpayers – taxes are everywhere and ever-increasing, impacting every aspect of their daily lives, including trivial things such as purchasing cigarettes, alcohol or gasoline. In recent years an increasing number of legal instruments have been adopted both at Belgian and European level, in order to strengthen the transparency of citizens’ revenues and thus further increase their future tax burden.

    For states, taxation is deemed to be vital to guarantee the proper functioning of basic public services. However, it should be noted that despite levying increasing taxes, Western European countries are unable to reduce public debt, while often cutting the financial means of key public sectors such as justice, defence and public infrastructures. The real ability of high tax regimes to truly reduce inequality is also questionable.

    In such a context, how is it possible to justify such high taxes to citizens? For many, the easiest way  out is indignation about tax scandals that are revealed on a regular basis – be they ‘Lux Leaks’, ‘Panama Leaks’ or ‘Paradise Papers’. These scandals present an opportunity to take steps to enforce tax transparency both at national and European/international level.

    Few see that they should also represent an opportunity to rethink the purpose and efficiency of current taxes. In Austria, young ÖVP leader Sebastian Kurz  appears to be one of them, as he declared that he wants a ‘lean state’ in Austria, with reduced intervention and taxes.

    Efficiency is a key principle to make tax levies acceptable to the population in future. In a recent book on the ethical aspects of taxation, the German philosopher Peter Sloterdijk reminds us that in Queen Victoria’s time a tax levy of 3,33 % was already seen as problematic.  

    Tax efficiency and tax justice are key to maintaining social cohesion within the population of the European member states. They raise important questions, which need to be scrutinised in relation to the subsidiarity principle. At European level in particular, a crucial question is how to balance a high degree of innovation and competition within the Euro area and tax harmonisation.

    A certain degree of tax coordination – for example with the exchange of information – is welcome and necessary in order to fight against tax fraud and tax evasion. But should tax coordination in specific areas automatically lead to tax harmonisation or even to tax uniformity?

    Unsurprisingly, high-tax countries dislike tax competition. However, the experience of VAT – a tax that is almost completely harmonised at European level – shows that tax harmonisation in Europe automatically leads to higher tax rates. As a general rule, harmonised tax legislation mandates a minimum tax rate, but never a maximum tax rate, which means member states are free to introduce higher tax rates.

    Furthermore, it is doubtful whether imposing harmonised tax rules can be seen as ‘fair’: every European country has its own features and sources of income. In fact, the truth is that tax harmonisation can be regarded as a convenient fig leaf for high-tax jurisdictions, enabling them to hide their need to undertake economic and fiscal reforms. It is designed to hinder the flow of capital and jobs from high-tax countries to low-tax ones. Tax competition, on the contrary, stimulates the efficiency of states that are ready to embrace a reformist agenda.    

    True, both tax competition and tax harmonisation have their own advantages: tax competition is deemed to promote economic growth and efficiency in the public sector, whilst tax harmonisation is expected to reduce firms’ compliance costs and strengthen transparency.

    The best scenario would be a European Union where investment decisions in any country are not merely determined by tax considerations, but also by other criteria such as the country’s social environment (in terms of education, health care, public infrastructure, environmental protection, etc..).

    European countries would compete to offer the best environment to potential investors, not just tax advantages, which in turn will benefit to the local population. Governments should devise policies that put tax competition at the service of the common good, not initiatives that curb it for the advantage of high tax jurisdictions. 

    Gaëtan Zeyen EU Member States Macroeconomics Social Policy

    Gaëtan Zeyen

    European tax policy: focus on efficiency, not harmonisation!

    Blog

    07 Dec 2017

  • The European Union is experiencing a new dynamic behind its quest for a credible security and defence capacity. New projects and mechanisms suggest a shift in European ambition.

    This paper assesses the reality of this new dynamic, arguing that the EU needs a clearly articulated grand strategy – outlining the objectives in the Southern and Eastern neighbourhoods, and tailoring those objectives to realistic means. Those means will range from high end assets to purely civilian assets. Defence spending will require structured Europeanisation. 

    Involvement of third countries will require creative legal developments. EU-NATO relations must undergo fundamental revision. If ‘strategic autonomy’, the objective of the European Global Strategy, is to become a reality, it will involve the EU progressively assuming leadership within NATO, thereby meeting the calls across the United States for the allies to assume greater responsibility for their own affairs.

    Defence EU Member States European Union Security

    For a True European Defence Union

    Future of Europe

    07 Dec 2017

  • The inability of the British government to gain Ulster Unionist support for “regulatory alignment” between Northern and Southern Ireland is baffling many in the Brussels bubble.  “Why is this so important?” they ask, as Irish diplomats take on an unusual prominence which makes every Irish person slightly uncomfortable. 

    But to understand why the border matters so much to the Republic of Ireland it is first necessary to understand the position of the Democratic Unionist Party (DUP) and to acknowledge that their loyalty to the wider United Kingdom is total and absolute. It is this loyalty, this requirement to assert their “Britishness” in any way possible that is determining their current actions. 

    Alas, centuries of Anglo-Irish conflict have seemingly failed to leave any hint of understanding on Tory decision makers.  

    The stated vision of the DUP, as per their official website, is to “maintain and enhance Northern Ireland’s constitutional position within the United Kingdom”. Nowhere in  this “vision” do the concepts of improving Northern Irish relations with either the Republic of Ireland or the European Union feature. In this context, it is probable that the only thing by which the DUP was really blindsided in recent days was Prime Minister May’s continuing belief that they would agree to any proposed deal that threatened their direct equality with the rest of the UK.

    Alas, centuries of Anglo-Irish conflict have seemingly failed to leave any hint of understanding on Tory decision makers.  Just over a century ago, Bonar Law led the Tories in full blown support of the Ulster Unionist opposition to the 1912 Home Rule Bill.

    His infamous message to Belfast – “Whatever steps you may feel compelled to take, whether they are constitutional, or whether in the long run they are unconstitutional, you have the whole Unionist Party, under my leadership, behind you” – showed just how far political manoeuvring can undermine civil democratic society and buttress insular, sectarian views: views which later exploded into action as the Irish War of Independence in 1919 and the partition of Ireland in 1921.

    On this issue, Prime Minister May is caught in a classic Unionist-Brexit dilemma. Following the traditional Bonar Law, the Tory position will keep the DUP happy (and maintain her power in Westminster) but destroy the Good Friday agreement and place in jeopardy a decades long (and very hard won) peace process. To place the interests of peace first, Mrs. May would probably have to resign, the Tories to lose DUP support and ultimately face the uncertainly of another general election.

    By 2021 and the centenary of the partition of Ireland we could be back to where it all started: strife in Ireland because of Tory party politics.

    The Irish fear, as evidenced by their quite aggressive diplomatic efforts over the past weeks, is that British misunderstanding of North-South Irish relations will always result in a “solution” solely in the interests of Westminster power politics and not in the interests of either Northern Ireland, its people or the island of Ireland as a whole.

    Contrary to much comment in the British media, the agenda of the Irish government is not to promote the idea of a “United Ireland”. Public support for this concept in the Republic of Ireland is far from overwhelming.

    Rather in promoting a more open, connected Northern Ireland, the Irish government is desperately seeking to allow normal society, a society where army checkpoints and senseless violence are not the norm, to continue to flourish. For this to occur, a soft border allowing the tens of thousands of daily interactions – both personal and business – to occur unhindered is an absolute pre-requisite.  

    Anglo-Irish history is, as historians know, full of many cruel ironies.  But perhaps the cruellest yet is that by 2021 and the centenary of the partition of Ireland we could be back to where it all started: strife in Ireland because of Tory party politics.

    Eoin Drea EU Member States Leadership Political Parties

    Eoin Drea

    Tory party politics and strife in Ireland

    Blog

    05 Dec 2017

  • The UK has traditionally played an ambivalent role in European security and defence policymaking. With Brexit, the EU loses one of its two serious military players. On the other hand, it has been liberated from the constraints imposed by London on the Common Security and Defence Policy, and this has created a new dynamism behind the defence project.

    There has been comparatively little commentary on the defence implications of Brexit, and the UK has been less than forthcoming in making concrete proposals for an ongoing UK–EU partnership. Both sides assert that they wish to maintain a strong cooperative relationship after Brexit, but the outlines of such an arrangement remain very unclear.

    This article suggests that the UK will have more to lose than the EU from any failure to reach agreement, and that UK ambivalence about links between the Common Security and Defence Policy and NATO will prove to be a major sticking point.

    Read the full article in the December 2017 issue of the European View, the Martens Centre policy journal.

    Jolyon Howorth Brexit Defence EU Member States Security

    Jolyon Howorth

    EU defence cooperation after Brexit: what role for the UK?

    Blog

    30 Nov 2017

  • The rule-of-law procedure against Poland, opened in January 2016, has painfully tested the safeguards supposed to protect the EU’s fundamental values. It is now obvious that the protective mechanisms need to be strengthened. For in their current form, tested in real life for the first time, they have not dissuaded the present Polish government, led by the nationalist Law and Justice party (Prawo i Sprawiedliwość, PiS), from seriously and continuously breaching the rules. All interested EU parties—that is, willing member states and institutions—should acknowledge this and start preparing modifications both to Article 7 of the Treaty on European Union, which includes a sanction mechanism, and to the European Commission’s Rule of Law Framework, so that the EU’s internal defences are strengthened for future needs.

    Read the full article in the December 2017 issue of the European View, the Martens Centre policy journal.

    Konrad Niklewicz Democracy EU Member States Political Parties

    Konrad Niklewicz

    Safeguarding the rule of law within the EU: lessons from the Polish experience

    Blog

    20 Nov 2017

  • Last Friday, the Czechs and the Slovaks commemorated the fall of Communist totalitarianism and the advent of a new era of freedom and democracy. We reflect on the events of November 17th and ask ourselves: was it all worth it? Are we living the life we imagined? Some go further and question whether we are really better off than we were under totalitarianism.

    While these questions may be disconcerting, we should not be afraid of asking them. Instead, we should worry about our unwillingness to address them. Why is it that the post-November development often leaves a bad taste in our mouths? Why is it that we sometimes experience disappointment, or even fear and regret?

    One of the reasons is that we have not yet met the expectations of 28 years ago. Euphoria over the fall of totalitarianism coupled with our lack of experience with the free world meant we were ill-prepared for the obstacles that needed to be overcome in order to integrate ourselves into this new reality.

    Another reason for this frustration is the turbulence that the free world itself has experienced over the last quarter of a century. This turbulence has forced us to re-think many of the things we took for granted about the Free World. That the 2008 Economic and Financial Crisis had its origins in the USA is significant.

    For decades, the US had stood as a symbol of freedom, civil liberties and prosperity for the freedom-loving people behind the Iron Curtain. Central to this was the belief that the President of the United States stood as the natural leader of the democratic world. Today we are confronted with the reality that this may no longer be the case.

    We wanted the world to be open to us, and for borders to become a thing of the past. But massive waves of migration and numerous terrorist attacks are leading people to demand that borders be closed once more and new fences be built. Throughout its existence, the EU has expanded and its membership has grown. Now, as we are faced with the exit of the United Kingdom we must acknowledge that this too is no longer guaranteed.  

    How do we find our bearings in this maze of tumultuous, often unforeseen, developments? In the past, we had a clear idea: to free ourselves from totalitarianism and plan our economy we joined the OECD, NATO and the EU. The goal was clear, and so was the way. Today, when we are facing truly unprecedented challenges, when unrest and instability are so present in our European neighborhood, we seem to be losing our bearings. Today the goal is not as clear.

    Last week, I had a peculiar experience. I got lost on my way to a conference I was due to open. After walking in the wrong direction for close to an hour, it transpired that I had inadvertently inserted the wrong hotel name into my smartphone. I believe my experience helps me to articulate an essential point: the reasons for our dissatisfaction and frustration are usually our own failures and mistakes. It is not the essence of the free world. We feel frustration because, although we cherish freedom, we are avoiding its unshakeable cost – accountability.

    We are yet to grasp that the EU is not “them” while Slovakia is “us”. “Us” now includes the EU and NATO. The government is engaged in a war of words with the opposition over whether or not we should be part of the core of the EU. However, neither side has said that it is also up to us: the Slovaks, the Czechs, the Poles, and the Hungarians to proactively shape such a core.

    In the aftermath of the 2006 General Election, a prominent Slovak political writer stated that “even the losers have a right to their government”. No doubt they do. However, the winners must be aware of their responsibility if they leave the governance to the losers. As liberal-minded people, we must be aware that freedom is inseparable from responsibility and the readiness to assume that responsibility is what we collectively strive for.

    Globalisation, the fourth industrial revolution, and the proliferation of social media has expanded the space of our freedoms, but equally it has enhanced the degree of our responsibilities. Unfortunately, the space of ​​these new freedoms can be misused; for instance, by spreading misinformation or by committing cyberattacks.

    There is no doubt that the world has changed since November 17th 1989. There is no doubt that it will continue to change in the future. But neither is there any doubt that the best answer to both present and future challenges will be our ability and readiness to safeguard our freedoms, and to assume responsibility. Responsibility for what we stand for and for our decisions.

    This is true for us as individuals, this is true for Slovakia, and also for the EU. It is also true for regional cooperation, for the Visegrad Group. Regional groupings can only play a positive role by encouraging inclusive dialogue rather than pursuing individual interests or generating imagined conflicts.

    Mikuláš Dzurinda Democracy EU Member States European Union Euroscepticism

    Mikuláš Dzurinda

    The Velvet Revolution at 28: from euphoria to responsibility

    Blog

    20 Nov 2017

  • This book explores how the position of the middle class has changed in the past decade. No Robots expresses the perspective of households which are not floating as some kind of atomic particles in a macro economy, but consist of human beings who find meaning in  relationship  to  others.  Analysing  their  perspective  on  the  economic  situation, globalisation, migration and technology is key, we believe, to understanding political trends.  In  this  context,  No  Robots  also  expresses  the  widely-felt  anxiety  about  the replacement of jobs by robots. Households in every country are concerned about the future of work: whether it will be there, whether it will be well-paid and whether their children are receiving the right education to find a job. These are the type of concerns that we uncover for a diverse set of countries from the European Union. 

    Economy EU Member States Macroeconomics Social Policy Society

    No Robots: The Position of Middle-Class Households in Nine European Countries

    Collaborative

    19 Nov 2017

  • Today being pro-trade and defending globalisation seem to be out of fashion. After Trump crushed the Trans-Pacific Partnership (TTP), and put the North American Free Trade Agreement (NAFTA) under his hammer, it does seem that the tide has turned against global trade and globalisation.

    In Europe this is seen through the fall of the TTIP agreement, which in fact was already in trouble before the election of President Trump. Anti-trade sentiments are labelled as partly responsible for the rise of populism in Europe, and nationalist parties have adopted a soft-anti trade stand.

    Setting the numbers straight

    But the fact is that the mainstream held assumption that there is strong anti-trade sentiment in Europe is a fallacy. The majority of Europeans support free trade and want more of it, as the Eurobarometer study shows. 73% of EU citizens view free trade as positive. There is national differences of course, with 85% of Danish citizens seeing it as positive at the higher end of the spectrum and 58% of Greeks seeing it positively.

    Furthermore, according to the Eurobarometer, respondents increasingly see globalisation as positive and important for economic growth. More than half of all respondents consider globalisation to be positive (54%), an increase of six percentage points since autumn 2016 and a 17-point increase since spring 2005. More than six in ten (62%) agree that globalisation is an opportunity for economic growth, and more than half (51%) agree that globalisation represents a good opportunity for companies in their country by opening-up new markets.

    How do you explain these results, despite all of the negative spin in the media? The fact is that Europe and the EU are made up of mainly small and medium sized countries, which understand that political and economic isolation will not bring them strength and prosperity. Many of the countries have well known success stories of citizens’ companies being successful in global markets. Those companies could not have made it if they only had access to the market of their home country.

    When the minority is loud and the majority remains silent

    If trade is such a popular topic, what then explains the unpopularity of TTIP in Europe? Firstly, a loud minority together with anti-globalist networks, who managed to dominate the debate. Secondly, for the large majority of the political actors in EU capitals and Brussels, TTIP was important, but not important enough to fight and go public in defending. And thirdly, as Matthias Bauer of ECIPE points out, the anti-TTIP movement was not a bottom-up movement but clearly a top-down one:

    “The widespread aversion to TTIP in Germany is the result of an orchestrated, top-down campaign initiative launched by a small number of long-established, well-connected and, thus, highly influential politicians of Germany’s Green and left-wing political parties and associated NGO campaign managers masquerading and operating under the guise of pro-democracy, pro-environment and pro-Christian civil society.”

    In addition, we are only beginning to understand how Russian-related media played strongly against TTIP.

    What should pro-trade forces do?

    A major difficulty with debating trade agreements is that when anti-trade actors criticise trade agreements, they usually speak hypothetically about what the trade agreement could contain. The problem, for example, with TTIP was that there was no official text since the negotiations were still ongoing. It is difficult to refute obnoxious claims on the details of the agreements on a fact-basis, when the official agreement paper has not yet been drafted.

    In this case, what should pro-trade forces do? Firstly, as the European Commission has already emphasised, as part of underlining the economic benefits and positive impact on growth, we need also need to make it clear that rule-based trade agreements can play a strong role in developing a rule-based framework for the global economy. Trade agreements aim to eliminate distortions and unfair practices on a global scale. They are a tool for promoting European values.

    Secondly, we need to continue to find new partners for trade and work on respective trade agreements. The Commission’s intention to examine the possibilities with Mercosur is a good example of the direction we should be going in. Also, we should build on where we left off with TTIP, especially in our trade relationship with the United States.

    Despite the political situation in the US, we must work on sectoral cooperation, as Vice-President of the European Commission Jyrki Katainen mentioned during a recent keynote. If an overall agreement with the United States is not possible, we should work on sectoral agreements. Despite the White House statements, there are still very important Republican and Democrat Congress members who are very much in favour of re-launching the trade agenda.

    Lastly and perhaps most importantly: we must change our mindset and understand that trade is not an underdog topic, but it is a topic which the majority of voters (at least centre and centre-right ones) feel positive about. If trade is supported by more than 50% of European citizens, it must not become a “no-go area” for centre and centre-right politicians.

    In conclusion, if the majority of European voters are in favour of both trade and globalisation, thus showing that the commonly held assumption about anti-trade sentiment in Europe is a fallacy, centre and centre-right politicians have an important mission to keep defending, pursuing and explaining the benefits that trade brings.

    Tomi Huhtanen Economy EU Member States EU-US Globalisation Trade

    Tomi Huhtanen

    The European anti-trade sentiment: a fallacy, not a fact

    Blog

    15 Nov 2017

  • Urban terrorist attacks have become increasingly frequent in Europe in recent years. The review conducted during 2016 into London’s preparedness to respond to a major terrorist incident found that London’s emergency services had improved their ability to respond quickly to such incidents.

    However, the safety of citizens from such events can never be guaranteed. Preparation is nevertheless essential, and emergency services need to adjust their tactics and plans in response to terrorist incidents that occur anywhere in the world as attack methodologies spread very rapidly through the Internet. The safety of all public spaces needs to be kept under review. There is a role for commercial businesses in enhancing security, and each individual has a part to play in building a culture of security and resilience.

    Read the full article in the December 2017 issue of the European View, the Martens Centre policy journal.

    Lord Toby Harris EU Member States Security Society

    Lord Toby Harris

    London and anti-terrorism in Europe

    Blog

    30 Oct 2017

  • The Czech parliamentary election took place on 20-21 October 2017.  The election resulted in a victory of protest parties. Their triumph was more resounding than expected. The election outcome is clearly part of the revolt against the established elites that is spreading across the West. Consequences for Czech internal and external policies remain unclear.

    Bafflingly, the populist triumph in Czechia occurred amidst economic growth of almost 3 per cent. Unemployment rates are at a historic minimum, 2.9 per cent, currently the lowest in the EU.  200 000 jobs are not filled, and salaries have been rising in line with the increased demand for labour. It was also the issues of salaries, not immigration, that dominated pre-election debates.

    Whether an economic protest on that part of the population which feels left behind, or a cultural one against globalisation, or simply better communication by the various protest parties, support for those who profess challenging the establishment has never been so high.

    Nine parties were elected to the Chamber of Deputies. This means a highly fragmented parliament. Composing a government that commands at least 101 deputies in a 200-member house will be an exercise fraught with difficulties. The four protest parties that made it to the chamber of deputies received 134 mandates. Astonishingly, they took the first, third, fourth and fifth position among the nine parties.

    The ANO (Yes) movement of Andrej Babiš won by a landslide, receiving 78 seats.  Babiš is a highly controversial figure. He is a billionaire who came to his riches during the privatisation process in the 1990s. He runs his movement as a private company (some people say he ‘owns’ his movement) and tolerates no internal dissent. He has been able to attract considerable new talent to politics–including a number of capable women–at a time when the other political parties continued complaining that no-one wanted to go into politics any more.

    Babiš resembles Beppe Grillo, the leader of the Italian Five Star Movement, by espousing an eclectic, in fact unidentifiable, political programme, and by regularly contradicting himself. Like another Italian politician, Silvio Berlusconi, Babiš has been able to accumulate economic, media and political power. Like Berlusconi, he is a master of marketing, and like Berlusconi, he is being investigated by the police for fraud, a fact that does not disturb his voters.

    Like Emmanuel Macron’s En Marche, Babiš’s ANO has bulldozed through the middle of the political spectrum, crushing the left parties and damaging the right. But unlike any of these figures, Babiš is suspected as having acted as an agent of the communist secret police before 1989.

    Although he served as finance minister in the outgoing centre-left government, Babiš regularly claims that he is not a politician. He prefers handing out doughnuts to writing political programmes. His public rants match, in their tone, anti-establishment rants that you could overhear in any Czech pub on any day or night.

    The Pirate Party, a newcomer to the chamber of deputies, ended up as the third party, having obtained 22 mandates. Their political programme is just as unidentifiable as ANO’s, although it does bear marks of multiculturalism and anarchism. The Pirates appealed distinctly to the young voters but their true colours remain a mystery, perhaps even to themselves.

    The Freedom and Direct Democracy (SPD) party also received 22 seats. Led by the son of an immigrant, the straight-talking Tomio Okamura, the party takes inspiration from other European far-right movements. It promotes a referendum on Czechia’s membership in the EU, a legal ban on ‘Islamic ideology’ and close ties to Russia.

    Finally, the Communists (KSČM), the fourth protest party, received only 15 mandates. This is a historic defeat for the Czech Communist Party who traditionally attracted most of the protest vote.

    In a strange way, this defeat for the Communists symbolises the defeat of the political establishment in this election. Ostracised by other parties, the Communists have not taken part in any of the post-communist era governments at the national level. Their stances–an anti-NATO rhetoric and a mix of internationalism and anti-German sentiments–have made the party a predictable anti-systemic force in Czech politics. In this election, many of their supporters moved to the centrist ANO and to the far-right Freedom and Direct Democracy.

    As for the political mainstream, the eurosceptic Civic Democrats (ODS), linked politically to the British Conservatives and the Polish Law and Justice party, surprised many by taking as many as 25 mandates, a marked increase from the 2013 election. The governing Social Democrats lost 35 mandates and ended up with just 15. This is a horrible defeat for a party that, along the Civic Democrats, used to form the backbone of the Czech post-communist era politics. Like elsewhere in Europe, the Social Democrat vote was swallowed by the far-right and the radical centre. 

    Also two pro-European centre-right parties linked to the European People’s Party did badly, barely scraping in to the Chamber of Deputies. The Christian Democrats (KDU-ČSL) and the liberal-conservative TOP09 received 17 mandates in total, as compared to 36 mandates in total in 2013. The Mayors movement, unattached to any EU-wide political movement, received 6 seats in this 2017 election.

    Creating a governing coalition will be a gargantuan task, given the level of animosity against and among the protest parties and the rebellious mood in the new chamber of deputies. A lot depends on how Babiš behaves after he, presumably, forms a government with one or more other parties.

    He may turn out a constructive figure, accepting responsibility for the country, its anchoring in the EU and NATO and taking a distance from his business and media interests. Or he turns the country’s economy into a branch of his business empire and joins the chorus of national populists who take pleasure in defying ‘the establishment’ and ‘Brussels’ without offering an alternative. It’s an open call.

    In the near future, the two Czech EPP parties need to consider again whether they can survive as separate entities. In this election, they were lucky, as both just overcame the 5% threshold necessary to enter the Chamber of Deputies. Such luck may not occur again. Pro-European centre-right forces need to set aside their differences and consider integrating the Mayors movement which has shown willingness to cooperate.

    TOP09 might consider widening its appeal beyond urban middle class and entrepreneurs. Finally, both TOP09 and KDU-ČSL need to offer promotion to female politicians in order to appeal to more sections of the electorate.

    Vít Novotný Elections EU Member States Political Parties Populism

    Vít Novotný

    Czech elections: it might not be the economy, stupid!

    Blog

    24 Oct 2017

  • President Macron in his sweeping vision of the Future of Europe (delivered on the 26th of September) correctly identifies the centrality of the Euro to the long term economic power of Europe. Through Economic and Monetary Union (EMU) he argues “we can create the heart of an integrated Europe”. His goal is increased economic power to allow Europe better compete on a global scale with China and the United States.

    His overarching plan for the Euro involves the creation of a Eurozone budget overseen by a common Finance Minister under European Parliamentary control.  Such a budget would be used as a stabilising mechanism in the face of economic shocks. 

    This is a vision for the Euro based on increased convergence across all aspects of the economic model – from harmonised corporate taxation to single regulatory frameworks in areas such as the digital economy. It is from an economist’s viewpoint, the traditional view of turning the Eurozone into an Optimum Currency Area (OCA) complete with what many term a “fiscal union”.

    Such a vision for Europe is both welcome and timely, particularly in the absence of a long term political framework from other member states.  However, his proposals for the Eurozone risk repeating two of the biggest mistakes made by European policymakers in the move towards monetary union thirty years ago. 

    Firstly, in the late 1980s, the desire to spur deeper political integration resulted in the construction of a monetary union whose institutional design flaws were painfully exposed from 2007 on. President Macron’s vision – “the German taboo is financial transfers; the French taboo is treaty change. Ultimately, if we want Europe, both will happen” – again assumes that more integration, more harmonisation will drive EMU forward.

    Yet, this vision fails to appreciate that the EU, and in particular the Eurozone, is still dealing with the results of the last decade of economic and financial crises.  While very real progress has been made across a suite of relevant issues (including Banking Union and ECB credibility as an independent actor) further vital work remains to be completed.

    In particular, Banking Union must be completed through the finalisation of a European Deposit Insurance Scheme, the Single Capital Markets programme progressed and the link between sovereign debt and domestic banks further weakened.

    In addition, a sense of economic realism must be brought to the political discussion on legacy debt issues, particularly with regard to Greece.  These are the practical issues that will determine the viability of the Euro over the next decade, not a much broader political vision of Europe as an OCA.

    Second, President Macron’s vision is based on an explicit belief that a fiscal union is required for the long run sustainability of the Eurozone. However, such a view is not based on the operational experience of the largest monetary union currently in operation, the United States. 

    As has been highlighted by many American economists and economic historians the development of the American monetary union was not characterised by automatic stabilisers or significant fiscal transfers. 

    Such characteristics took nearly two centuries to be developed. Rather, the existence of a credible “no bailout” clause underpinned credibility and allowed the monetary system in the U.S. to evolve into the Federal Reserve System which operates today.  A system which even since its establishment in 1913 continues to change and evolve.

    President Macron’s vision for Europe chimes nicely with broader debates on the “Future of Europe” currently being aired in all member states.  However, when it come to the Euro, a more realistic approach will help preserve its stability for us all.

    Eoin Drea EU Member States Eurozone Macroeconomics

    Eoin Drea

    President Macron, politics and a realistic approach to the future of the Euro

    Blog

    24 Oct 2017

  • It has been a challenging year for the European Union. The hangover from Brexit, election fever in a number of European countries, terrorist attacks in European capitals, the perennial existentialist question of quo vadis Europe, and now the Catalan crisis.

    After Macron’s victory in France, liberal democratic Europe breathed a sigh of relief. The outcome of the French presidential election and Merkel’s much anticipated victory would restore confidence in liberal democracy, and put the European project back on track. And to a large extent this has happened. It has not been a clean sheet, however. 

    Germany did not manage to escape the predicament of other European countries: the weakening of traditional democratic parties and the surge of nationalist populism and extremism. The western liberal order has survived for now but the party pillars of the political system have been weakened.

    Those that are left behind by change, frustrated and alienated, direct their anger towards mainstream politics. 

    The centre-left, centre-right divide, for many decades, offered European societies a set of different ideological creeds, policy options, and solutions, within the framework of free market-based liberal democracy. Now, we are witnessing the erosion of this post WWII European political divide.

    Structural changes such as globalization, the fiscal conformity in preparation for the monetary union, and the monetary union itself created a policy of convergence between parties. The main victims of this fusion were the centre left parties that travelled most of the political distance towards the centre.  

    The adoption of centre-right elements in economic policies and structural reforms gave them electoral victories in the short run but in the long run was a prologue of their demise. Mainly because it severed the ties with their party base and their traditional electorate. The financial crisis and the backlash against globalization further eroded the political centre.

    Exacerbated economic inequalities, blamed on globalization and automation, have altered societal stratification, creating new haves and have-nots.  New waves of immigration have created a demographic and cultural panic. Technological advances created a new divide in society between technologically literate and illiterate, and a new kind of technological unemployment.

    Open societies does not mean lawless societies and certainly not borderless states.

    Those that are left behind by change, frustrated and alienated, direct their anger towards mainstream politics. The centre-left parties may have become something of an endangered species, but the centre-right parties have come under pressure as well.

    The disdain of politics as usual and political correctness has empowered populist leaders and parties from both ends of the political spectrum. From Beppe Grillo, Tsipras, Podemos,  and Die Linke, to Trump, Farage, Le Pen, and Orban, all have run against status quo politics. They have tried to manipulate the anger and disappointment in government, the establishment, corruption and nepotism, stagnating salaries, and rising unemployment.

    A new dividing line is being formed: on one side are the traditional political formations, and on the other side is an abrasive, anticonformist populism. A populist surge that is based on economic protectionism, an assertive nationalism, xenophobia, anti-immigration and anti-globalization policies.

    The populists have also capitalised on the return of identity politics. When threatened, people tend to resort to fundamental values intrinsic to their identity. Germany managed, in the decades following WWII, to place the debate on identity within the European context. Now, AfD, breaking old taboos, brings back the debate to the national level, exploiting the uneasiness of part of the society from the presence of a million refugees on German soil.

    The return of identity politics is interconnected with euroskepticism. The incomplete European project is at a critical juncture. The populist demagogues make a case against Europe as being unable to provide policy responses to the challenges of immigration, border security, homeland security, or economic inequalities.

    They are questioning, in essence, the wisdom of transferring authority and sovereignty from the nation states to Brussels. The antiglobalization of the populist left feeds euroskepticsm, while the extreme right of AFD and Le Pen resort to xenophobia, protectionism, and nationalist extremism.

    We can be patriotic without being nationalistic, we can defend freedom and human rights as well as law and order with equal conviction.

    The new political landscape is a minefield for centre-right parties. Populism, extremism and especially right-wing extremism and nationalism have appealed to voters by distorting our ideological agenda. In an effort to repatriate those voters, centre-right parties might be tempted to veer to the right and trail extremism as it sets the agenda. That would be a political folly.

    Before repatriating our voters we should repatriate our ideological agenda, reclaim it and project it forcefully. Centre-right parties have to stay the course, defend liberal values, respond to the challenges based on our own ideological arsenal. We can be patriotic without being nationalistic, we can defend freedom and human rights as well as law and order with equal conviction.

    Open societies does not mean lawless societies and certainly not borderless states. We can defend the market economy while addressing inequalities. We can address the inequalities resulting from globalization and automation without becoming protectionist and isolated.

    Compromising our values and principles will only present us with short term political gains, if it does. It will hurt, however, our fortunes in the long run, as the socialists have discovered.

    Constantine Arvanitopoulos Centre-Right Elections EU Member States Leadership Political Parties

    Constantine Arvanitopoulos

    Centre-right parties: sailing in stormy seas

    Blog

    18 Oct 2017

  • Watershed. Earthquake. Tectonic shift: the hyperbole is palpable in Berlin, on the morning after a memorable election. But let’s be clear: this election will remain memorable not because of a change of Chancellor. Angela Merkel will lead the next government as much as she has led the previous one. But this election will be remembered for three other reasons:

    • First, both big tent parties, Angela Merkel’s Christian Democrats (CDU/CSU) and Martin Schulz’ Social Democrats (SPD), have dramatically lost votes. Most of the smaller parties have gained in strength, and the new Bundestag will have six parliamentary groups (i.e. seven parties, because CDU and CSU have a common caucus). While there is no desire for radical change in Germany – the economy is doing very well – there seems to be a certain unease with the way both big parties have been running things.
    • Second, Germany now has a very self-confident right-wing populist party, AfD, which will be the third strongest force in the Bundestag. That means there will be more provocations, more passionate debate, but also more nonsense in Parliament.
    • Third, in a refreshingly clear and early move, right after the first exit poll, Germany’s Social Democrats have taken themselves off the map for coalition talks, saying they will have to rebuild themselves in opposition, and also in order to prevent the AfD from being the strongest opposition party.
    Source: The Federal Returning Officer

    Here are the three most important takeaways from this election:

    1. The only coalition option for the moment seems to be ‘Jamaica’ – a four party coalition of CDU, CSU, Liberals (FDP) and Greens

    Even before the election, everyone knew that coalition building would be tricky. But now that the SPD has clearly ruled out remaining in government, there is only one option left. Its nickname refers to the colours of Jamaica’s flag – black (CDU/CSU), yellow (FDP) and green. It also implied, until now, a certain outlandishness which is now gone. But coalition talks will be excruciatingly difficult. In immigration policy, energy and environment, as well as family and gender questions, conflicts between the Greens and the others (especially the CSU) are obvious.

    The FDP may turn out to be difficult in questions of the Eurozone. And at the end, any coalition deal will have to be approved by the members of both Greens and the FDP: by no means a foregone conclusion. If this coalition option fails, either the SPD will have to join the government against its will, or there will be snap elections. Both options sound unpalatable, hence ‘Jamaica’ may well be condemned to success.

    2. The right wing populist Alternative for Germany (AfD’s) success is news for Germany, but will not revolutionise German politics

    Contrary to what many of Germany’s scandalised bien-pensants are now saying, Germany is getting what other European democracies (France, Austria, the Netherlands and many others) have had for a long time: right wing populists in the national Parliament. Some in the AfD rehash elements of racist nationalism, and many others are Eurosceptic conservatives, but most of them bear a fundamental grudge against Chancellor Merkel’s migration policy since 2015.

    According to all opinion polls made around the election, people did not vote AfD because of economic fears or income inequality. They did so as a protest vote against what they perceived as a government losing control of our borders, a rise in crime and terrorism, and against a very centrist drift of the CDU in recent years. New infighting between and inside CDU and CSU about identity politics and the right amount of social conservatism will be unavoidable.

    As to the AfD, there will be ugly scenes in the Bundestag when its politicians claim that Germany’s coming to terms with its past (Vergangenheitsbewältigung) belongs to the past. But the one million former CDU/CSU voters that voted AfD in 2017 will not be impressed if they’re labelled Nazis by everyone else. We will have to live with this paradox for the time being. It makes no sense to frame European politics primarily in terms of ‘open vs. closed’ instead of left vs. right, which is another reason why the SPD’s decision to join the opposition benches is probably a good idea.

    3. Changes in Germany’s foreign and European policy will be only gradual – but they will be in the right direction

    In a ‘Jamaica’ coalition, Chancellor Merkel will most likely determine foreign affairs even more than in recent years. She will continue to represent the steady hand at the helm in turbulent times, as she emphasised time and again on election night. In the Franco-German couple, the ideas will mostly come from Emmanuel Macron (he has announced a major speech this week) and Angela Merkel will accept some and reject others.

    The FDP’s staunch opposition to a transfer union in the Eurozone will limit her maneuvering space. She will definitely reject the notion of a two-speed union, but together with EU institutions uphold the rule of Law in Europe, against individual governments such as Poland’s and Hungary’s. But she will want to avoid the impression of a new East-West conflict between old and new member states.

    On European defence, a ‘Jamaica’ coalition is likely to push forward together with France, but incrementally and within NATO, not replacing the Alliance. Sanctions against Russia are set to remain in place – the Greens’ disdain for Putin will likely help Merkel against any appeasing steps that CSU and Liberals might have in mind.

    Whether all this is really enough to respond to the urgent need for leadership in Europe, in times of Anglo-Saxon withdrawal through Brexit and Trump, and mounting insecurity in the EU’s neighbourhood, that is the question. But if she wants to form a legacy beyond the 2015 refugee crisis, Angela Merkel will have to push Germany to a more active role in European and international security.

    Finally, on this bittersweet election night, most observers agree that Angela Merkel’s fourth term as Chancellor will also be her last. But if she wants to leave her successor, whoever it may be, a fair chance of proving themselves in power, she might have to leave the stage a year or so before the election in 2021.

    At the moment, nobody can really imagine a CDU without Angela Merkel, or Germany or Europe without her. And yet, that moment will come. The complicated coalition talks of the next few weeks, and the difficult government afterwards, may yet look harmless compared to the bumpy times of 2020 and beyond.

    Roland Freudenstein Education EU Member States Leadership Political Parties

    Roland Freudenstein

    Angela’s bittersweet victory: takeaways from Germany’s election

    Blog

    25 Sep 2017

  • The State of the European Union address by European Commission President Jean-Claude Juncker contains five takeaways for Romania which prove, once again, that the country has an important role in the Commission’s plans to reform the European Union. Romania has a unique chance to be amongst the member states that will take the next step towards European integration.

    1. The Sibiu summit: linking Romania to the future of the EU

    One of the most important takeaways for Romania announced by President Juncker is the proposal to hold an EU summit in Sibiu on the 30th of March 2019, the day after the UK leaves the European Union. This summit, which will take place during the Romanian presidency of the Council of the EU, will constitute a means for EU leaders to reflect and make decisions about the future of the EU. It is a great opportunity for Romania, as all future steps of European reform and integration will be linked to our country and the city of Sibiu.

    In addition to this historic summit opportunity, Romania can also use the fact that it holds the Presidency to explain to Romanian citizens what the European Union means and what joining the EU has meant for the country. Related to this, I believe the decision to hold all informal meetings at ministerial level of the EU Council in the Palace of the Parliament in Bucharest is a mistake. Romania is more than Bucharest and the Parliament Palace: it holds the seventh largest population in the EU and has large, well-developed cities with a modern hotel, administrative and air transport infrastructure, capable of providing all the conditions for such an international event. 

    I would propose instead to organise the ministerial meetings in several cities of the country. Why not have the Defence Ministers’ meeting in Constanta, near the military base in Kogalniceanu where we could talk about security in Europe? Moreover, why should we not organise the meetings on education in a university centre with tradition and prestige such as Cluj-Napoca or Timisoara? Why should we not organise the meeting of Foreign Affairs Ministers in Iasi, near the border with Moldova, where we could also talk about the Eastern Neighbourhood and about Russian threats?

    2. and 3. Renewed support for our strategic priorities: the eurozone and Schengen

    President Juncker also announced the launch of a European Commission instrument that will provide technical support to Member States which are not yet members of the euro area, but that will have to join in the near future, as is the case for Romania. It will be a very useful tool for our country, as it is certain that euro area Member States will continue to integrate further and there would be a risk for countries that have not yet adopted the single currency to remain on the outside.

    President Juncker’s message is clear: when we take future steps in the direction of European integration, the countries that are not yet in the euro area will not be disregarded. This is the same request that I made earlier this year as rapporteur on the fiscal capacity for the euro area.

    This budget must be open to all EU Member States, including those that are not yet members of the euro area, but who have the obligation to adopt the single currency in the future. They must receive full participation rights, contribute and benefit financially and be part of euro area governance in order to be fully prepared when they adopt the single currency.

    Beyond technical support for joining the euro area, President Jean-Claude Juncker has asked European politicians to allow Romania and Bulgaria to join the Schengen area. His message was clear: if we want the EU to have stronger external borders, Romania and Bulgaria must join the Schengen area immediately. It is time for other European political leaders to understand that our country’s place is in Schengen, that our country’s borders are part of the solution, not part of the problem. 

    4. Brexit will not reduce European funds for Romania

    The budget of the European Union after the exit of the UK will have to be even bigger than before: this was one of the key messages of the President of the European Commission. The truth is that we cannot have a strong Union with a weak budget. This is the case especially since we see that a new traditional priority of the European Union has been added alongside growth and job creation, namely security challenges.

    Thus, President Juncker’s announcement means that the level of European structural funds allocated to Romania will not be influenced directly by the exit of the UK, since we will not be talking about a reduced budget, but on the contrary, about a larger budget.

    However, for Romania to benefit from the same high level of EU funds beyond 2020, it has to convince other Member States that allocations for our country are being used efficiently. The only way to prove this is to have an absorption rate close to 100% during the current multiannual financial framework (2014-2020).

    5. Respect for the rule of law remains an obligation

    President Juncker’s statement on the rule of law, which according to him is binding for all Member States, is bad news for all politicians in Romania who think they can control justice. This is however good news for the many honest citizens who advocate for the respect of the rule of law.

    The rationale is clear: it is simply not possible to enjoy the benefits of joining the European Union (free movement, billions of euros in non-reimbursable funds, etc.) and at the same time try to control justice and state institutions. The Commission will not tolerate even the slightest deviation from the rule of law – this is the firm commitment given by President Juncker.

    The speech by President Jean-Claude Juncker contrasts with all the gloomy scenarios that were predicting a Union in which our country would be disregarded or on the outside. The message is clear: there is no predefined group of countries, a core nucleus. Romania, like all other Member States, will have the chance to participate in all steps of European reform and integration.

    Moreover, because we will hold the Council Presidency during Brexit and because we will host the first summit on the future of the post-Brexit EU, Romania has a unique opportunity to be amongst the member states that will lead the future steps of European integration. It depends only on us, especially on the Government and other state authorities to take advantage of this truly historic opportunity. 

    Siegfried Mureşan EU Member States Eurozone Leadership

    Siegfried Mureşan

    SOTEU: 5 key takeaways for Romania

    Blog

    14 Sep 2017

  • The first question that needs to be answered is still the familiar one: ‘do we even need Europe at all, with all the expense it entails?’

    The answer, quite simply, is yes, because, unlike in the past, the traditional nation state can no longer protect its citizens and tackle the immense challenges it faces using only the instruments available at national level.

    For example: what is the use of the German government’s decision to shut down the country’s nuclear power plants if at the same time new plants of this type are being built in France and the Czech Republic? Is a system of national drug licensing fit for purpose now that citizens can buy medication anywhere in Europe?

    Does fighting cybercrime and tax avoidance at the national level stand any chance of success these days? What about environmental protection and competition law? When it comes to the limitations of national action, the list is endless. In these areas, the European level must be used on a supplementary—in other words, subsidiary—basis.

    In addition, Europe is urgently needed as a unified ‘voice of reason’, championing peace and stability in what has become an unpredictable world.

    Having answered the initial question in the affirmative, let us immediately turn to a second question, namely why it is still so difficult for many people to accept the European level, despite its importance. In response, I would say that the practical implementation of European policy requires a radical rethink: European decisions, by definition, must be geared towards what is best for Europe as a whole, rather than the good of individual nation states, as has often been the case up to now.

    Of course there may be divergences between the two. For example, European Central Bank President Mario Draghi has justified his zero-interest policy (which is hopefully now nearing the end of the road) by emphasising his commitment to the European common good. Accepting this may be far from easy, but it is essential to Europe’s long-term success.

    The election of Emmanuel Macron as French president has fuelled great expectations of the new Franco-German partnership. These range from cutting youth unemployment and supporting neglected regions to curbing right-wing nationalism.

    However, simply handing out money would be expensive and entirely unhelpful. Instead, the following measures should be taken:

    • Support should be provided for an effective structural policy that will get the neglected regions back on the right track.
    • Dual education, combining apprenticeships with vocational training, should be introduced across Europe, as only this will create the conditions for successful small and medium-sized enterprises.
    • A genuine social partnership must be established between employers and trade unions throughout Europe; as long as these two key players continue to view each other as enemies, as is the case in some countries, the cooperation needed for economic success will remain out of reach.
    • The political class in southern Europe must have the courage to implement unpopular but inevitable reforms at national level, similar to the Agenda 2010 reforms undertaken in Germany. If you want a stable currency, you need to build an efficient economic structure.
    • The European level must facilitate economic development, and so enable job creation, by cutting red tape and preventing its further proliferation.
    • The European level must exert all its global influence to reject any attempts around the world to put up protectionist trade barriers. For our part, we in Germany should take seriously our neighbours’ recommendations to ‘normalise’ our high current account surplus through domestic investment.

    It is fair to say that European integration to date has been a huge success. Since Europe faced its darkest hour at the end of the horrific Second World War, the continent and Germany in particular have experienced an astonishing recovery.

    This success, unprecedented in history, was born of a number of factors, but European integration is certainly foremost among them. Only when enemies had become partners and friends could the foundations be laid for Europe’s new, universally admired role and importance on the world stage.

    To conclude, the long-term success of our own country, Germany, depends on the success of the European project. We are, indeed, already bound by a common destiny.

    Ingo Friedrich EU Institutions EU Member States Integration

    Ingo Friedrich

    Emmanuel Macron: where do we go from here?

    Blog

    11 Sep 2017

  • While most attention over the past few years has been centred on Russia’s aggression and the critical situation in the Middle East, very few analysts notice a security emergency on the EU’s south-eastern border. 

    Only in 2016, the Greek General Staff recorded 1,671 national airspace violations by Turkish aircraft. The size of this breach can be easier understood if one considers that, during the same period, NATO jets scrambled to intercept Russian military planes 780 times, which is the highest recorded number since the Cold War.

    The root of tensions in the Aegean is Ankara’s efforts to question the existing status quo in the area, both in the air and at sea. This antagonism has led the two countries three times (1976, 1987 and 1996) to the brink of war. According to international norms, the national airspace should correspond to territorial waters. However, Greece, since 1931, established its airspace to 10nm, while its territorial waters remain at 6nm. This international paradox was never challenged by Turkey before its invasion in Cyprus.

    The reasoning behind the Turkish stance derives from its claims that the 4nm difference between Greek airspace and its territorial waters should be considered as international space over which Greece has no authority. The situation became more complex when, in 1995, the Turkish Parliament declared that any possible extension of the Greek territorial waters up to a limit of 12nm – and subsequently the national airspace – would automatically result in an act of war (casus belli).

    Over the space of the past seventeen years, Turkish fighter jets – many of them equipped with combat arms – have been violating Greek airspace (see below), resulting in interception attempts by Greek forces and, in many cases, dangerous air engagements and dogfights, even over inhabited islands of the Eastern Aegean.

    Photo source: Global Military Review

    In reality, Turkey’s revisionism in the Aegean can be traced to its existential fear of possible geopolitical, economic and military isolation. Taking into consideration the political instability and security threats that the country is facing over the space of the past five years, one could easily understand how fragile peace on NATO’s Eastern flank is. In that frame, Erdogan’s rhetoric on possible change and renegotiation of the Lausanne Treaty – which defined, in 1923, the boundaries of the modern state of Turkey – endangers not only Greco-Turkish relations, but the entire South-East Mediterranean region.

    The frequency of Turkish violations and infringements also dramatically affects and puts in harm’s way civil aviation in the area. The concentration of the Greek islands, coupled with the intensity and the heights that the warplanes can reach, increase the probability of another fatal accident in the Aegean, as has happened in the past.  

    Another important aspect of this secret war is the financial cost. According to Greek officials, every time a Greek fighter jet scrambles, the cost rises to €8,000 – €12,000 per hour. Of course, in the case of collision, this cost exceeds the €50,000,000 per plane without counting the loss of human lives. As it is easily understood, these numbers for a country in deep recession are onerous and deprive other sectors more vital for the daily life of the Greek citizen of important resources.  

    Unfortunately, during the last four decades, the EU and especially NATO, have not paid the necessary attention to Turkish bellicosity. It is evident that the Turkish political and diplomatic fluctuations should alert the West. Impartiality and apathy with regards to Turkish hostile behaviour towards its neighbours should not be the norm.

    Erdogan and Putin’s recent marriage of convenience has raised many analysts’ doubt over Turkey’s intentions. Therefore, NATO should not underestimate the fact that Greece remains the oldest member of both NATO and the EU in the region, committing – even under the current horrendous financial situation – 2.38% of her GDP to defence, and thus to the Western alliance.

    In fact, the Aegean dispute has not been adequately debated. It is not solely a Greco-Turkish problem. It should be perceived as an EU problem, as Greece is called upon to protect the Union’s external borders in the vital region of the Eastern Mediterranean. The EU should finally define, in the clearest terms, its current land, sea and air borders, in order to be prepared to protect them against any external threat.

    An idea would be the creation of a common European airspace, by establishing territorial sea and airspace 12nm, throughout the EU. This decision might discourage further provocations and hostile acts by third countries, as well as defusing tensions between the two bitter friends in the Aegean.   

    Panos Tasiopoulos Defence EU Member States Technology

    Panos Tasiopoulos

    The untold war: dogfights in the Aegean

    Blog

    19 Jul 2017

  • Since last year when the UK made the decision to leave the EU, we at the Martens Centre have been having an intensive discussion on how to deal with this issue, particularly how to avoid a risk of negative escalation between the UK and the EU. While emphasising constructive communication, just over a week ago we gathered in London to discuss with like-minded experts and decision-makers how to avoid disaster and make the best of it for those of both sides. Here are some of my personal recommendations on how to manage the ongoing negotiations, based on my own experience from the division of assets after the break-up of the former Czechoslovakia.

    1. Tackle strategy first, tactics second

    To begin with, it is necessary to define the end result, namely the expected outcome of the EU-UK negotiations: the shape of our long-term relationship after the UK leaves. Do we want to remain allies, or just friends and partners, or simply neighbours? If we want to remain allies, does this only apply to NATO or also to other areas of cooperation?  Depending on what conclusion the two sides will eventually agree upon, we can proceed to formulating the content of the new deals in all specific and relevant areas – the free movement of persons, trade, security and other topics.

     2. Define the “what”

    This regards the status of the EU citizens living in the United Kingdom and vice-versa, the final bill for the UK’s exit from the EU, the regime at the border between Northern Ireland and the Republic of Ireland and that between Gibraltar and Spain, and possibly other issues directly related to Brexit.

    3. Be flexible on the “when” and the “where”

    When, at a relevant moment, the negotiations show that we are on the right track but more time is required to strike a good deal, we should agree on a transition period for the UK to leave the EU. Several factors should be taken into account for that transition period (such as conformity with the EU financial planning period).

    4. Consider Brexit irreversible

    There will be no second referendum. We should not work with this hypothesis, not even at a theoretical level; we should not fuel false hopes of those who continue to believe that the process of the UK’s exit from the EU can still be reversed.

    5. Remember: non-agreement is not an option

    Both sides should clearly declare their awareness of the fact that an uncontrolled exit of the UK from the EU in the absence of any agreement on mutual relations is the worst possible outcome for both sides. Brexit-related losses must be kept at a minimum on both sides. To this end, an agreement is inevitable: That means both an agreement on the future arrangement of mutual relations and one on the divorce.

    6. Keep it realistic

    We should strive for concluding the deals that will be enforceable, sustainable and feasible within the set deadlines. This is the only way to avoid misunderstandings in the future and to minimise the harm caused by any such misunderstanding.

    7. Communicate more, squabble less

    There is no doubt that Brexit is a lose/lose “game” for both sides (the EU and the UK). The time before the UK’s exit from the EU becomes final (March 2019) should thus be used to cut the losses. The squabbles over the amount of the bill to be paid by the UK could drag on for years (it took close to ten years to resolve the division of assets of former Czechoslovakia). But it would be a waste if those squabbles went on at the detriment of our citizens, trade, investment, or security cooperation.

    8. Let diplomats do their job

    Brexit talks are now an arena where every spoken word becomes the object of analyses, comments and, of course, reactions. In this kind of atmosphere, it is difficult to offer concessions. Yet we know that concessions are inevitable. Thus, in addition to official negotiations exposed to public scrutiny and media comments, it is also necessary to engage in an intensive “silent” diplomacy.

    9. Strive for a compromise…

    The most promising method in a win-win or lose-lose game is the search for a compromise.   Both sides must realise that compromise is a state where both sides leave the negotiation table (after reaching a compromise) either equally satisfied or equally dissatisfied.

    10. …and achieve a win-win

    The final decision will be political. It will be made by politicians at the time of ratifying the deals. Both the rhetoric and the expectations should be shaped accordingly. There is a need to work with public opinion right from the beginning. Public discourse should be dominated by the emphasis on mutual benefits and not by rivalry or even vengeance. The EU can only survive if it is built on a positive vision, on positive emotions and, in particular, if it brings added value to its member states.  

    At one moment, the Communist bloc collapsed like a house of cards in spite of being held together by force, threats and intimidation. It disintegrated because it was becoming an ever greater burden on, and not a benefit for, its member states. That is why the final deal will only be sustainable if it entails the best for both sides.

    Mikuláš Dzurinda Brexit EU Member States Leadership

    Mikuláš Dzurinda

    The ten commandments of Brexit negotiations

    Blog

    05 Jul 2017

  • This article argues that maintaining the status quo is not an option for the euro area. The euro has functional and existential weaknesses that force us to take drastic action if we want to become resilient enough to withstand the next banking crisis. The article argues that the existential weaknesses of the euro stem from the D/Y ratio (debt-to-GDP). Euro-area members have only limited scope for using traditional mechanisms to deal with D/Y problems.

    What makes this especially worrying for the overall stability of the euro area is the ownership of the debt issued by the euro-area member states. It is absolutely vital to separate banks and sovereigns and to slash debt-to-GDP levels. The question is whether the political decision-making processes in the member states can deliver these structural changes.

    Read the full article in the June 2017 issue of the European View, the Martens Centre policy journal.

    Juha-Pekka Nurvala Economy EU Member States Eurozone Macroeconomics

    Juha-Pekka Nurvala

    The status quo is not an option: functional and existential weaknesses of the EMU

    Blog

    04 Jul 2017

  • Despite the EU’s official motto ‘United in Diversity’, the bloc is experiencing a profound crisis in which diversity is threatening to dispel unity. Instead of harmony, diversity increasingly spells conflict. A variety of factors are behind this strife, including terrorism, the uncertain position of religion in public life, the unclear situation of minority groups (including autochthonous minorities and the Roma), radical Islamism, insufficient integration of immigrants and a loss of personal status and identity due to globalisation.

    These phenomena are occurring against the backdrop of the recent economic crisis, instability in Europe’s neighbourhood, and the uncontrolled influx of migrants and refugees in 2015–16. All these developments are feeding conflicts both among the member states and between the EU institutions and national governments, as well as a cultural war between globalists and identitarians that cuts across European societies. 

    The European People’s Party, and governments at all levels, need to engage with the ‘forgotten part’ of society without compromising on pluralism and personal freedoms. They need to promote a concept of state which allows different religious and secular opinions to thrive. They should combat extremism and, in cooperation with civil society, encourage a public culture that defends tolerance and liberty. They should promote a critical reading of the Koran.

    Developing concepts of citizenship with a focus on immigrants is crucial, as is effective participation of autochthonous minorities and the Roma in public life. Taking such steps would ensure that internal and external adversity does not destroy European unity. 

    Ethics EU Member States Immigration Religion

    Unity in Adversity: Immigration, Minorities and Religion in Europe

    Collaborative

    08 Jun 2017

  • Emmanuel Macron’s election to the French presidency has been welcomed as a ray of spring sunlight in the cloudy skies of Brussels. It is believed to be the first salvo of a mainstream counteroffensive against the insurgent forces of populism in Europe. Since his first visit to Berlin last May, Macron made it clear that his European ambitions pass through a revitalisation of the Franco-German relationship, long debilitated by the imbalance between the two historic partners.

    In the short term, Macron’s relaunch of European integration pursues three objectives: the creation of common European rules on asylum, stronger reciprocity in trade with external partners and new rules to stop the ‘social dumping’ effect of posted workers from Central and Eastern Europe.

    Although Macron’s rhetorical virtues managed to present this last demand as impeccably European, in practice it can only amount to further restrictions on the free movement of services and people, two fundamental EU freedoms much resented by French  – and British – public opinion.   

    However, we should all wonder whether Macron’s success may not turn out to be as risky for the Union as his failure.

    In the long term, the President wants a eurozone budget to promote investments, a eurozone finance minister to administer it and a eurozone parliament to legitimise both. These plans may require not only changes in the EU treaties, which the President has not excluded, but also in Germany’s constitution.

    A credible French leader with an ambitious European agenda is surely good news for the old continent, whose unity has shown in recent years to be very fragile and in need of new safeguards. However, we should all wonder whether Macron’s success may not turn out to be as risky for the Union as his failure. There are two serious reasons to harbour such fears.

    The first is the potentially divisive nature of many French ideas about the future of Europe. Two of them, a weak commitment to the free movement of services and people and a tendency to focus on integrating the eurozone without much attention to the interests of the euro-outs, are particularly problematic.

    The former is an old thorn in France’s relationship with the EU, at least since the bogeyman of the ‘Polish plumber’ contributed to its rejection of the constitutional treaty in 2005. Since then, no pro-EU politician in the country has really been able to convincingly defend free movement without adding a plethora of qualifications about ‘social dumping’ and ‘fairness’ that are difficult to digest in Central and Eastern Europe. Emmanuel Macron is no exception here.

    The latter stems from the French tradition of economic ‘dirigisme’, which makes the notion of a ‘depoliticized’ currency based on constitutional rules and market discipline incomprehensible to the French way of thinking. Hence the insistent demands for a ‘managed’ currency, one complemented by an economic government responsible for promoting investment and, in the long run, harmonizing social standards in order to prevent, once more, ‘social dumping’ and enforce ‘fair competition’.

    Like it or not, Central and Eastern European countries instinctively distrust centralisation, dislike differentiated integration and are especially attached to the Single Market and its four freedoms.

    Those are highly divisive ideas that will prove potentially difficult to reconcile with the pursuit of unity among the EU27 – not just the EU19 – after Brexit. Like it or not, Central and Eastern European countries instinctively distrust centralisation, dislike differentiated integration and are especially attached to the Single Market and its four freedoms.

    The second reason is the geopolitical implications of France’s ambition to restore the Franco-German axis to its former role as the engine of European integration. French elites have gradually understood that there are structural reasons why Germany has come to play a more central role than France in Europe. Its good economic performance is one of them, and the economic and demographic consequences of reunification are another.

    However, the main reason is the geopolitics of the 2004 enlargement: Germany is the pivotal player because it is the guarantor of Central and Eastern Europe’s participation in the European project and because the EU membership of this region has given it a much larger playing ground on which to build its coalitions. This was a momentous change from previous decades: as long as the European project was limited to a small group of Western and Southern European countries, France was inevitably the pivotal partner of Germany.

    The most far-sighted French observers have long understood that the Eastern enlargement was bound to make France more marginal and Germany more pivotal in Europe. Mitterand, who was certainly one of them, tried to counter this tendency by proposing to include countries newly freed by the communist yoke in a broad confederation within which the European Community would have retained its inner balance.

    Today the only way for France to regain its geopolitical centrality is for the European project to be recentered on its western and southern core. This is well captured by Macron’s plans on the future of Europe, which de facto amounts to de-emphasising the single market, limiting free movement, and investing much political capital on integrating the euro zone.

    The most far-sighted French observers have long understood that the Eastern enlargement was bound to make France more marginal and Germany more pivotal in Europe. 

    If French demands are taken up by Germany, the risk is that the project will tacitly refocus in a direction that weakens, not strengthens continental unity. Germany’s historic mission is to lead the continent towards a model of unity that is sustainable and acceptable to everyone. The adoption of Macron’s agenda implies the exact opposite.

    Federico Ottavio Reho Eastern Europe Enlargment EU Member States European Union Leadership

    Federico Ottavio Reho

    Macron’s vision will split the EU, not unite it

    Blog

    08 Jun 2017

  • On June 7th the European Commission will put forward its proposals to enhance European military cooperation, framed as ‘The Future of the European Defence’. These proposals are very timely and necessary and will hopefully be embraced by all EU Member states. However, it is important that we don’t fall into a trap when we speak about European defence, because what is possible in the future is vastly different to the realities of European defence today.

    The conclusion reached in various EU member states is that under US President Donald Trump, we can no longer rely on NATO as much as we did before, especially considering the increased aggressiveness of Putin-led Russia. Therefore, as a backup plan, we will need to boost European defence cooperation and increase our independent military capabilities. It is possible for this to happen within the NATO framework rather than contradicting or overlapping with it.

    The logic is solid, but there is a danger in underestimating the urgency of the situation. The security that NATO provides cannot be replaced by any European defence cooperation in the near future. The fact is that, since 1990, European real military capabilities have decreased dramatically.

    In many countries, real operation units have fallen to one third of what they were at their peak in the 90s, and even then they were operationally dependent on US support. When we examine the figures, we can see that they paint a stark picture for the EU’s military capabilities without the help of the US.

    Within the NATO framework, the US spends 3 times more on its military than the combined total of the EU member states. And this ratio has not been not improving: from 2007 to 2015, the US increased their defence spending by an average of 3.1%, whilst the EU28 decreased their military spending by an average of 14.5%.

    Figure 1: Changes in Western European Combat Battalions (1990-2015)
    Source: IISS, The Military Balance 2016

    The combat battalion figures of EU member states are also in sharp decline. Germany, for example, has decreased its total battalion count of 215 battalions in 1990 to just 34 in 2015. In key military equipment, the EU28 have collectively decreased their total stock of battle tanks by 70%, helicopters by 38%, and patrol and combat boats by 54%.

    Across the board, there is one trend we can see in relation to EU defence spending and that trend is decline. Europeans still cannot and could not confront a large-scale military intervention from Russia effectively without the help of the United States.

    Crucially, major military upgrades take years if not decades to complete. A good example is Russia, which started a major reform of its military after the war in Georgia in 2008, when they realised that they had a large, but ineffective army.

    The reforms came with unquestionable political and financial support from Putin, who even cut domestic budgets such as social welfare and healthcare in order to pay for this military reform (a move which would be extremely unpopular in Western European states). However, even though Russia has invested massively in its military since 2008, Russia’s military reform is still far from complete

    When we talk about the future of the common European Defence without the US, we need to realise that we as Europeans have for decades been totally reliant on the support of the Unites States. The argument for a strong European defence also assumes that European military spending would be greatly increased and that enhanced military cooperation would turn to some form of integration.

    It is also necessary to point out that if Europe is to build a military force which is capable of facing a worst-case scenario, then we need to speak about European nuclear weapon capabilities.

    The Commission’s proposals for enhanced military cooperation are very welcome, we need more initiatives like them, and we need to embrace them. Investing in the future of European military cooperation is the only solution to independently maintain the integrity of the EU in the long term. However, in the short term, this goal is not possible without the support of the United States.

    We can be disappointed by what President Trump did or did not say during his last European visit, but we should not neglect or fail to give credit to the fact that operationally the US continues to invest in Europe as it did before.

    Just look for example at the US troops in the Baltics or the US bilateral defence cooperation agreement with Estonia. When we evaluate our investment in our transatlantic relationship with the United States, we need to take into account that so far nothing has changed in US-EU defence cooperation.

    Whilst taking steps to enhancing European military cooperation and common capabilities, the EU member states need to continue the modernisation of their military and increase their independent capabilities. To achieve a genuine European Defence Union, this Union needs to be built on the modern and fully operative units of the EU Member states.

    Tomi Huhtanen Defence EU Member States EU-Russia Security Transatlantic

    Tomi Huhtanen

    European defence can only be achieved by closing the capabilities gap

    Blog

    06 Jun 2017

  • China first became an active and visible player in Central and Eastern Europe (CEE) in the 1950s, when it worked together with the region to stop a possible Soviet invasion of Poland in October 1956. This strong relationship was later dismantled due to the Sino-Soviet split and the volatile domestic situation in China (the Great Leap Forward and the Cultural Revolution).

    It is only since 2012 that China has become active in the region again, now as an emerging global power with a strategy and new investment initiatives in play: first the 16 + 1 framework and now the Belt and Road Initiative as well. Does China consider the CEE countries to be its new playground, or test area, within the EU? Or does it instead see the region as a gatekeeper that can help it get a foot in the door to the West?

    China has a vision, a pragmatic approach and political will, but the implementation of this vision has been weak. While several existing mechanisms offer new potential, they have so far only been partially exploited, due to the different business mentalities of both sides, as well as many other obstacles. China is opening up opportunities for CEE, but the latter must be better prepared for China’s new activities.

    Read the full article in the June 2017 issue of the European View, the Martens Centre policy journal.

    Bogdan Góralczyk EU Member States European Union Foreign Policy Globalisation

    Bogdan Góralczyk

    China’s interests in Central and Eastern Europe: enter the dragon

    Blog

    27 May 2017

  • Events in recent years have put the European economic integration project and the euro under pressure. The main cause of the euro crisis is loss of competitiveness, particularly on the periphery of the Economic and Monetary Union. To reverse this, Union members must promote structural reforms that increase long-term employment, productivity and external competitiveness.

    The successful implementation of reforms, however, requires sufficient public support, which in turn presupposes measures that support demand during the implementation of reforms. To that end, important steps include taking an expenditure-based approach to fiscal adjustment and the introduction of the European Deposit Insurance Scheme.

    And for Greece in particular, the set of necessary steps includes taking ownership of reforms, the downward revision of fiscal targets, and medium- and long-term measures of debt relief conditional upon meeting fiscal/reform targets. Finally, the stability of the euro hinges on the moderation of all fiscal and external imbalances across all member states, regardless of whether these imbalances are apparent or not.

    Read the full article in the June 2017 issue of the European View, the Martens Centre policy journal.

    Michael G. Arghyrou EU Member States Eurozone Growth Macroeconomics

    Michael G. Arghyrou

    Structural reforms in the euro area: a Greek view

    Blog

    24 May 2017

  • The EU is losing the battle for Europeans’ hearts and minds. The long economic crisis and the subsequent immigration crisis have frustrated millions of citizens and angered them against the elites—and, unfortunately, against the EU.

    Many fear that their material status, the economic security of their families and their ability to fulfil their own expectations and ambitions are slipping out of their hands. Europeans are also suffering from an identity crisis. Many believe that their countries and neighbourhoods are being threatened by mass immigration and that the ruling elites, sealed off in steel and glass towers in their respective countries’ capitals, are not listening.

    The EU is facing its biggest communication challenge ever. The EU institutions need to take up the gauntlet and start defending the European project. The purpose of this paper is to analyse potential new ways of ‘advertising the EU’. The key assumption is that, whenever possible, EU institutions should follow best practices from the business sector since these have proved to be more effective in the current communication environment.

    EU Institutions EU Member States European Union Euroscepticism

    We Need to Talk about the EU: European Political Advertising in the Post-Truth Era

    Research Papers

    23 May 2017

  • Mr. Emmanuel Macron is the new president of the French republic, and was formally enthroned in the Élysée Palace last Sunday. He succeeded François Hollande, a decent ‘president without qualities’ who reminded one of a musilian character from the crumbling Habsburg Empire, as opposed to anything resembling French grandeur.

    The new President, although only thirty-nine years old, seems to have an intense sense of the dignity of his function, framed since 1958 by Charles de Gaulle as a monocratic power in almost mystical connection with the French nation. He decided to celebrate his victory in a highly symbolic lieu of the French capital: the pyramid of the Louvre.

    This marks a discontinuity with the traditional settings of France’s political celebrations: for the Left, Place de la Bastille, where the 1789 revolution started; for the Right, Place de la Concorde, where an ocean of de Gaulle’s supporters converged after marching on the Champs-Elysées in protest against the leftist uprising of May 1968.

    The Louvre’s pyramid is a symbol of modernity built under socialist President François Mitterrand. But the Louvre Palace is an eternal witness to the glory of the old monarchs of France, who used it as one of their residences up until the construction of Versailles by the Sun King. The place, neither Left nor Right, modern and traditional at once, is perhaps a perfect symbol of Macron’s most striking characteristics: his fundamental political ambiguity and the mystery within which his real personal and political self is constantly wrapped.

    No doubt part of this ambiguity and mystery is a consequence of Macron’s limited exposure to the limelight. A private person far from the public’s attention until August 2014, the young public official and banker was only then catapulted by his mentor François Hollande into the post of Economy Minister, from which his spectacular ascension to the Presidency started. However, more profound reasons concur to forming this impression.

    First, Macron’s intellectual identity is solid and ambiguous at once. A man of great intellectual gifts according to most observers, Macron trained as an economist, started his career as ‘Inspecteur des Finances’ in France’s powerful public administration and worked several years as a banker.

    However, his first genuine loves were literature and philosophy: a passion for theatre seems to have brought him together with his wife, and he once assisted the renowned philosopher Paul Ricœur in preparing one of his publications. His interest in the humanities seems thoughtful and sincere, so that he is a technocrat and a humanist at once.

    Contrary to Valery Giscard d’Estaing, to whom he is often compared, Macron is a humanist turned technocrat, not a technocrat turned humanist. This brings him closer to François Mitterrand, a man with a taste for erudition and a profound grasp of the subtle nuances of human psychology. From this perspective, Macron could not be further from his two immediate predecessors: Hollande, a grey product of France’s technocratic establishment, and Sarkozy, a son of the pop culture of the 1960s and 1970s.

    Second, Macron’s politics is ambiguous, and this goes much beyond the alleged vagueness of his presidential platform. Macron is the second European politician who consciously bet on a transformation of western political systems that would substitute the cleavage reformist/conservative in place of the old left/right cleavage, deemed to have outlived its usefulness in an economically global world and politically integrated Europe.

    The first was not Matteo Renzi, a foreign leader to whom Macron is also compared – much to the latter’s chagrin I would imagine – but former Italian Prime Minister and would-be political leader Mario Monti. While Renzi has consistently depicted himself as a centre-left leader, Monti’s bet in 2012 was to split both the centre-right and the centre-left between their reformist, economically liberal and pro-European components on the one hand, and their economically conservative and Eurosceptic elements on the other hand.

    The first would be reorganised as a strong political centre under his leadership, and carry forward a programme of national reforms and European unification, while the latter would be condemned to lasting marginality in opposition. Macron is surely a more charismatic and gifted leader than Monti, but his vision ‘beyond Left and Right’ is essentially the same.

    Third and most importantly, Macron’s political goals are ambiguous. To be more precise, his political goals are only partly stated because some of them cannot be openly stated. What can be least stated is that the archenemy of Macron is not the Front National, but the republican Right. This has nothing to do with Macron’s personal distance from the positions and the leaders of the republican Right – in fact, on many policy areas, most notably the economy, his ideas are closer to the republican Right than to the Left.

    It is the logic of his political bet that requires the republican Right to split and crumble, with a more centrist wing swallowed by his movement ‘La République En Marche’, and a more hard-core wing potentially attracted by a newly rebranded Front National or condemned to irrelevance. If the republican Right succeeds and prospers, Macron will lose the political bet of his life. This is why he appointed a centre-right Prime Minister this week, in the hope of encouraging the forces of decomposition among centre-right conservatives.  

    It is true that Macron pledged to reabsorb support for the Front National during his five-year term. But his actions have subtly and, I suspect, consciously legitimised the far-right as his main opposition. Contrary to Chirac in 2002, he accepted to debate with Marine Le Pen, implicitly recognising the legitimacy of her project.

    He even addressed to her a ‘republican salute’ in his acceptance speech. In fact, Macron cannot accomplish the transformation of the French political system he is seeking without absorbing the republican Right and legitimising the Front National as his main right-wing opposition, and he is certainly aware of it. The cold-blooded precision with which he executed his plans so far, while hiding some of their real implications, signals that he shares not only Mitterrand’s erudition, but also his Machiavellian genius. 

    This article was originally published in New Europe
    Picture source: kenvtv.com
    Federico Ottavio Reho Centre-Right EU Member States

    Federico Ottavio Reho

    The mysterious Monsieur Macron

    Blog

    15 May 2017

  • This article argues that the traditional European narrative based on the rhetoric of progress, openness, ‘an ever closer union’ and the ever greater sharing of sovereignty has lost traction with a significant percentage of the European electorate, who are gripped by frustration, insecurity and disarray. It sketches the broad lines of a new Europeanism, arguably one that would be better equipped to deal with populism and identity politics. It makes the case for a ‘leaner Europe’, less bureaucratic and intrusive, but also more openly political and culturally grounded.

    Read the full article in the June 2017 issue of the European View, the Martens Centre policy journal.

    Federico Ottavio Reho EU Member States European Union Eurozone Integration

    Federico Ottavio Reho

    A new Europeanism before it is too late

    Blog

    11 May 2017

  • Donald Trump has repeatedly chastened European NATO members for spending less than 2% of their GDP on defence. In spite of recent reassuring declarations, his commitment to NATO has seemed wavering, and he displayed a readiness to coordinate with Russia in the Middle East.

    Should the Trump administration reach a similar understanding with the Kremlin on Eastern Europe, the Europeans will shed tears of regret for not having followed his advice and invested in their defensive capabilities earlier.

    Russia’s aggression in Georgia and Ukraine leaves little doubt as to the real unwillingness of the Kremlin to respect the sovereignty of the former soviet republics. And the Baltic States are next on the firing line. Urgent actions are needed in this field.

    First, defence spending needs to be increased. West Europeans have relied upon the USA since the 1940s for their own security, de facto freeriding on US taxpayers in this field. With 23 European NATO members below the 2% threshold in defence spending, it is clear that Europeans have overlooked their national security for too long.

    The time has now come for them to invest more on it. All of the European NATO member states increasing their defence spending to 2% of their GDP will send a powerful message to the Kremlin that they are serious about protecting Europe’s security and independence.

    Russia’s aggression in Georgia and Ukraine leaves little doubt as to the real unwillingness of the Kremlin to respect the sovereignty of the former soviet republics. 

    Second, European battlegroups need to complement NATO troops in the Baltic States. Increasing defence budgets does not instantly create a safer security environment. In a 2016 report, RAND made clear that the current national defence forces of the Baltic States and the NATO units stationed there are insufficient to hold off the neighbouring Russian forces, should the latter decide to invade. Germany and other NATO members have since contributed to forming battlegroups in the Baltic States and Poland.

    However, the size of NATO’s battlegroups is negligible compared to that of the Russian forces they face. Establishing permanent European battlegroups of significant size, with the necessary equipment to deter Russian aggression, would reduce the EU’s vulnerability in the east, and perhaps lead to an improvement in its relations with Russia, as the Kremlin will have to accept that it cannot encroach upon its European neighbours’ territory.

    According to the RAND report, this would cost around $2.7 billion, which is far less than what would become available if countries reached the 2% threshold in defence spending.

    Third, the supply of military hardware for the battlegroups needs to be homogenised. Each member state using unique military equipment takes away the option of lending that hardware to one another. Lending military hardware contributes to cutting down the costs of transferring it, and it is an invaluable asset, as troops in warzones could use leased equipment right away.

    For example, Greek F-16 and Mirage 2000 pilots, being experts in intercepting Turkish military aircraft violating Greek airspace, could assist in the protection of the Baltic States’ airspace using allied jets of the same type. Creating defence equipment homogeneity requires political will. So far the EU has been unsuccessful in creating military interoperability. Nonetheless, this should become a priority in order to secure European borders.

    Europeans need to direct their militaries into defending the entire EU, and not just individual European states.

    The President of the European Commission Jean-Claude Junker, has repeatedly spoken in favour of establishing a single European defence force. That currently being unfeasible, the Common Security and Defence Policy (CSDP) needs to be focused on the creation of battlegroups in member-states under threat.

    Assuming that all NATO member states reach the 2% objective of defence spending over GDP that would still not deter Russia from being aggressive towards its neighbours. The fact that the European NATO member states spend on defence five times the Russian defence budget, and remain unable to secure Eastern Europe is embarrassing.

    Europeans need to direct their militaries into defending the entire EU, and not just individual European states. After the end of the Napoleonic Wars the German states were facing similar threats to their existence by France and Russia. The Germans established the Federal Army to defend themselves, which was a collection of the armed forces of the member states of the German Confederation.

    The EU could imitate this model in the near future, while bearing in mind that the Federal Army fell apart in 1866 due to the lack in commitment of several of its members. Thus, even more ambition may be needed in the long run. 

    Konstantinos Lentakis Defence EU Member States Foreign Policy Leadership Security

    Konstantinos Lentakis

    Beyond 2%: establishing a true European defence force

    Blog

    10 May 2017

  • The year 2017 will mark the sixty-year anniversary of the Treaties of Rome. On this occasion, the European project will receive a thorough check-up, and important decisions will be made that will decide whether and in what form it survives.

    In this context, it is crucial to recognise the long-overlooked contest between two competing visions of European federalism, propounded by two great figures of Europe’s twentieth century: Altiero Spinelli and Friedrich Hayek.

    The recent past tells the story of a revolt against European integration that is taking dangerously big dimensions and demands urgent countermeasures.

    Honest pro-Europeans should admit that some sort of Hayekian federalism is the only federalism with some chances of success in our continent.

    This briefing was originally published on the European Policy Information Center (EPICENTER) website

    EU Institutions EU Member States European Union Integration Values

    The past and future of European federalism: Spinelli vs. Hayek

    Other

    10 Apr 2017

  • On the eve of the invocation of Article 50, this policy brief disentangles the main components of the Brexit imbroglio and lays out the legal framework and political constraints of the negotiations that are about to start. It assesses the reversibility of Brexit, the likely duration and possible outcomes of the negotiations, the legal options for the transition period, and the probable impact of Brexit on the EU27 in general and Central Europe in particular.

    Because of the UK’s size, economic weight  and  political  clout,  as  well  as  its  peculiar  historical  background,  it  concludes that the new EU–UK relationship cannot be based on one of the existing ‘models’ of external arrangements. The new partnership between the UK and the EU27 will have to go beyond even the most comprehensive free-trade agreement and it should also include finance, energy and external economic policies, as well as covering foreign policy, security and defence.

    The author emphasises that any weakening of the free movement of persons as a result of the negotiations would be  a  serious  violation  of  the  essential  constitutional  principles  upon  which  the EU is built, and could damage the foundations of European integration. The brief considers managing internal differentiation without creating permanent divisions among groups of countries as the most important challenge ahead for the EU27. 

    It also argues  that, with  Brexit, Central Europeans will lose a powerful ally on many economic and constitutional issues, although their economic and geopolitical weight will be on the rise in the new EU27.

    Brexit Economy EU Member States European Union Trade

    Brexit. Brexit?

    Policy Briefs

    15 Mar 2017

  • There has never been a shortage of thinking about the future of Europe. Last week, the Commission presented its five scenarios. Which is timely, because things are not working as they are. And which could be a distraction for the same reason: from the Commission one would expect to be strong on execution rather than on thinking about the future. Nevertheless, ideas are valuable.

    While the scenarios present a complete palette of organisational options for the EU, they are shallow in explaining why do we want the EU in the first place. What is its raison d’etre? This is what the proposed sixth scenario is about. But first let us have a look at the strengths and weaknesses of the original five.

    1 – The project goes on

    In the first scenario, the EU continues to implement reforms as planned. This “business as usual” scenario is useful because it reveals what the authors understand as problems. The two problems are that the decision-making process is slow, inefficient and complex; and that the EU institutions are not meeting the citizen’s expectations.

    To put it shortly, Brussels has no power to meet the expectations of citizens. This is the problem that the other scenarios are supposed to address. And what these scenarios propose, in fact, is either lowering the expectations or increasing the powers of Brussels.

    2 – Less Europe

    The second scenario assumes that the EU – unable to agree on anything else – is reduced just to a common market. It is unclear if this means abandoning the common currency. In principle, the common market is not so little if it functions properly. Hayek explained that a common market is a sufficient basis for a working interstate federation. It preserves peace, which is touted as the main achievement of the EU, and prevents government meddling with the economy.

    In the scheme of the five scenarios, this one has a role of the “bad one”. The writers assume that in order to be competitive in the common market, the member states would “race to the bottom” in the absence of common consumer, environmental, social and tax standards.

    This strawman should be approached with caution. Unless the EU does not ensure global standards for consumer protection, environment, social assistance etc. it would as a whole be a victim of a global “race to the bottom”. The solution would assume joining Mr. Donald Trump in limiting the freedom of world trade.

    3 – More Europe for some members

    The third scenario – multiple speed Europe – acknowledges that some member states may be interested in doing more together. While there may be many new interesting topics of collaboration, one is present as the elephant in the room already: the monetary union.

    A closer cooperation in the Eurozone is not an option but a necessity. The moment of truth for such a closer cooperation comes when German taxpayers would need to pay, for example, the Greek education system. Which, of course, means that the Germans can have a say in how many teachers you need on a small Greek island with two kids.

    This brings us to the core problem of all variants of “more Europe” scenarios: lack of European identity. If anything should be learned from Trump, Brexit and the raise of populism in Europe is that identity matters.

    Without people belonging to Europe almost all scenarios are doomed.

    West Germans were somehow willing to pay for East German social services. Not because Germany is a democracy and a democratically elected parliament passed a budget that said so. But because East- and West- Germans are one people. They are all Germans. They share history, culture, religion and language. They share identity. They are one demos. And you need a demos for a democracy. You can have a union without a demos, but without democracy. Like the USSR or Yugoslavia.

    The European democratic deficit, seen so often as a key European problem, has its root in the European demos deficit. The level of political integration that can be achieved formally is limited by the level of common European identity that is achieved among Europeans intuitively.

    4 – More Europe but on fewer topics

    This means the EU would need to concentrate on a few important tasks, but those performing well. Hard to find anything wrong with doing good the important stuff. The devil is in the details and the details are on which topics the EU would do more and on which less.

    5 – More Europe on all topics

    Member states should transfer more power to Brussels and establish common policies for several areas. This is essentially the Verhofstadt scenario and in line with the proposed new European Constitution of the Ljubljana Initiative. The “United States of Europe” scenario has all the problems of the Euro Area of Scenario 3, only worse, because there are more member states involved.

    All scenarios above are making one wrong assumption: that the division of power between member states and the union is a rational, technocratic decision to be taken by political elites while pretending to be debating it with “the citizens” on the internet.

    6th Scenario – More Europeanism

    Democracy needs an identity foundation that binds individuals into the demos. The binding can be a language, a religion, a culture, a race, or a belief in a credo. Europe does not have that. The proof? If something like that existed it could have been exploited by the populists just like the French, American, German, Dutch populists are exploiting the French, American, German, Dutch identities. There are no successful pro-European populists!

    The local and particular cannot be based on the general and universal. Local and particular is every state-like entity. Universal concepts of liberal democracy such as human rights, the rule of law and democracy are not a sufficient basis for local communities. There has to be something more in addition to the universal. Huntington explains this in his book Who Are We?

    Europe can be saved. But it will take more than technocratic options on how organise relations between Brussels and the member states. The sixth scenario is a scenario of a passionate Europeanism.

    We Europeans!

    Europe lacks a statesman whose platform would be “I am a European”; one who would sell to Europeans the dream of making Europe – not great again – just making Europe. Who could say what great things “we Europeans could do if we stood together”. And say it to the Germans, the French, the Dutch, the Slovenians and so on. It seems the founding fathers in the 1950s were able to do so but then this art was lost.

    She should sell the idea to the intellectuals that European nations working together is the only way to preserve the European civilization, its culture, its values, its institutions, its creed and its religion. That the reason for existence of the European Union is no more no less than to provide an institutional backbone of European civilization.

    And he should sell the idea to everyone that only together can Europeans face the threats from the south and from the east; that the battles of Tours and Vienna were fought and won by Europeans who spoke different languages! If dormant feelings of belonging to a group are to be awakened, let people belong as Europeans too, not just as Germans, French, Dutch..

    Europe lacks a statesman […] who would sell to Europeans the dream of making Europe – not great again – just making Europe.

    It would take too long to forge this sense of belonging by Interrail tickers, Erasmus exchanges and mobile phone roaming. These are all nice to have but, seriously, train tickets cannot be the foundation of a political union. But an idea can be! An idea of proud Europeanism that is adopted by leaders and communicated with a loud and clear voice, that is. Perhaps communicated to the voters at the next European parliamentary elections!

    The division of power between the member states and the union will then depend on how strong is the sense of belonging to the union via-a-vis belonging to the member states. This will determine which options from the menu of the five scenarios above are realistic and which ones are not; and where the Union could and should do more and where not.

    Without people belonging to Europe almost all scenarios are doomed.

    This op-ed orginally appeared in New Europe
    Žiga Turk EU Institutions EU Member States European Union Euroscepticism Values

    Žiga Turk

    The sixth scenario and Juncker’s white paper

    Blog

    08 Mar 2017

  • The Wilfried Martens Centre for European Studies (or Martens Centre), the official think tank of the EPP, had yet another year of exciting developments in 2016, while strengthening its network of member foundations, which now comprises 31 members and more than 12 partners.

    EU Member States European Union

    Activity Report 2016

    Activity Report

    01 Mar 2017

  • What is the alternative to a hard Brexit? 

    I believe conditions can be created in which the UK voters could decide not to leave the EU at all.  Ireland should work to create those conditions. The terms for Brexit set out by Mrs May will do incalculable damage to this island, politically, emotionally and economically.  We cannot simply wait for this to happen. While seeking to mitigate the effects of Mrs May’s chosen hard Brexit, we must also do everything we can to ensure that there is no Brexit.

    Apart from a few open questions, Theresa May has said what she wants. She wants out of the single market, out of the customs union, and “control” over immigration. The open questions she has avoided so far are about the financial terms of the divorce, the status of EU citizens living in the UK and vice versa, and two aspects of a future trade agreement (if there ever is one), namely arbitrating disputes, and  third country imports getting into the EU via the UK.

    It is unlikely that the Article 50 letter she will send to Donald Tusk next month will tell us much more about the UK negotiating position than the Lancaster House speech did. So it is time now to start thinking about how the EU will respond to Mrs May’s letter.

    On the present schedule, the European Council would meet in April to agree the orientation it would give to the EU negotiators for the discussions with the UK that would start in June. These orientations would be agreed by consensus, so every EU head of government would have to be satisfied.  For Ireland, this April European Council meeting is potentially the most important European meeting a Taoiseach will ever attend.

    In working out the orientation to be given to the negotiators, the crucial thing is for the European Council to work out what would be its ”best alternative to a negotiated agreement” (BATNA). It is important to have an alternative ready because there is every possibility that no agreement will be reached within the two year time frame for negotiation, and ratification, of a withdrawal agreement. Mrs May has said that, for her, no deal at all preferable to a bad deal. Her BATNA, so to speak, is no deal at all.

    “No deal” would mean the UK simply crashing out of the EU overnight, sometime before the end of March 2019.  This “no deal” scenario would be an overnight halt to flights, to trade and to commerce. There would be immediate and massive currency instability.

    From the point of view of pure negotiating tactics, maybe it is no surprising that Mrs May would threaten with a “no deal”. But to do so, in the absence of a well-crafted fall-back position, is something the UK cannot really afford. It vindicates Tony Blair’s description of the UK government as “not driving the (Brexit) bus”, but rather “being driven” by partisan and ideological forces it has not tried to control. In the absence of a real alternative to a hard Brexit, it is on auto pilot heading towards a cliff.

    The EU country that would be worst affected by the UK crashing out of the EU with no deal is, of course, Ireland. So Ireland must use all its imagination and ingenuity to see if a creative way out for the UK and the EU can be found.

    Should the EU offer UK voters another option? 

    If the UK government is unable or unwilling, because of domestic politics, to work out a responsible “best available alternative to a negotiated agreement” (BATNA), then the EU side should do so for it.  It should adopt it alongside its line by line response the UK’s negotiating demands. Having a BATNA would also strengthen the EU’s negotiating position. It would provide something with which an emerging deal could be compared. It would also provide a basis on which the UK could reconsider its decision of 23 June 2016, if it wants to do that.

    As Tony Blair said, UK voters have a ”right to change their minds”. After all, politicians are allowed to change their minds, so why not voters? If UK voters, in a referendum, sent their government on a mission towards Brexit, it would be reasonable that the same voters, rather than Parliament, should adjudicate on what will have been achieved (or not) by their delegates.

    If UK voters ever do change their minds about Brexit, it will happen slowly and incrementally. Parts of the Brexit scenario, obscured during the Referendum, will become clearer during the negotiation. The unavoidable interconnections between EU freedoms and EU rules will emerge. For this to happen, it will be in the EU side’s interest to ensure that there is maximum public understanding of the unfolding negotiation. Transparency will work in the EU’s interest.  A running commentary is exactly what is needed in the interest of public education!  

    If the alternative to EU rules is no rules at all, citizens in both the EU countries and the UK may come see EU membership in a different light. They may, for the first time in many cases, see the EU as something that simplifies their lives, rather than the reverse. In my view, the best BATNA that the EU side should adopt is an offer of continuing UK membership of the EU  broadly on the basis that the UK  was a member in 2015, before David Cameron’s ill fated “renegotiation”. 

    The 2015 terms were generous to the UK. They allowed it to opt out of the euro, of Schengen, of Justice and Policing cooperation, of the Stability and Growth Pact, and of the justiciability in the UK of the European Convention. Furthermore, the UK itself had also decided, without Brexit, that it would have a referendum of any new EU powers. In that sense the UK was already having its cake, while eating it, before it ever decided on Brexit. These 2015 terms should be left on the table by the EU side, but without the unjustifiable UK budget rebate.

    Of course, at this stage, the UK would reject such an offer out of hand.  But, as the inevitable consequences of Brexit become clearer, UK public opinion might begin to see merit in it, particularly when it is compared with the costs of simply crashing out of the EU, overnight, with no deal at all, which is Mrs May’s fall back negotiating scenario.

    The resistance to keeping such an offer on the table is more likely to come from some existing EU member states. Some members will point to the UK’s insatiable demands, when it was a member, for opt outs, rebates, and exceptions.  Arlene Foster’s analogy about feeding crocodiles may come to their minds. They will recall General de Gaulle’s original veto of UK membership, and his foresight that the UK would never settle in as a member. They might also argue that offering the UK a way back, after it has triggered Article 50, might encourage others to try it on too. 

    But if they sit back and think about it, they will, I believe, conclude that a UK that inside the EU is better for the EU than a UK that is outside. This will be so even if a trade deal is eventually concluded with the UK. Keeping the offer of resumed UK membership on the table would be good politics and good economics for the EU.

    The terms of the Lisbon Treaty do create some difficulty for this approach. Article 50 (3) says a country that has sought to leave the EU under that article will be automatically excluded from the EU two years after it has triggered Article 50 unless the EU side “unanimously decides to extend the period”. Article 50 (5) says that, if a state, that has withdrawn for the EU, asks to rejoin, it has to do under article 49, where the application would have to be ratified by all existing members.

    Others may argue that the UK cannot withdraw its Article 50 letter once it has sent it. This is a matter for the European Court of Justice to decide, but article 6.8 of the Vienna Convention on treaties explicitly allows revocation of a notice of intention to withdraw from a treaty.

    These problems are real, but not insurmountable. A political declaration by the EU heads of Government in April in favour of facilitating an eventual UK resumption of EU membership, on its 2015 terms minus the budget rebate, would create a realistic basis for comparison in the debate about Brexit that, in a sense, is only now starting in the UK.  

    John Bruton Brexit Economy Elections EU Member States European Union

    John Bruton

    Brexit out of the box

    Blog

    28 Feb 2017

  • The 2010s are becoming a decade of geopolitical paradoxes, even tectonic shifts. Donald Trump’s electoral victory may create a new and outrageous alliance between the US and Russia at the expense of the EU. And Trump may take the US out of the global agreements that Obama government promoted to make banks more resilient to storms on financial markets.

    In the UK, Scottish nationalism that two decades ago could not boast even a weak Scottish assembly, has by mid-2010s contributed to the rise of English nationalism. It was the latter force that ripped the UK out of the EU through the 2016 independence referendum.

    It seems that leaving the EU will not satisfy the mighty centrifugal momentum that is pushing the UK polity away from the continent. The possibility that the UK would stay in the single market is no longer there. Among the West European prime ministers at the time, UK’s Margaret Thatcher took the political lead in the efforts to dismantle barriers to trade inside the common market (see this Thatcher speech from 1988). 

    Theresa May’s historic speech on 17 January 2017 made it clear that the UK would be leaving the single European market, the joint product of British free market ideas and French and German efforts for the unification of (West) European economies. All that as a price for the ability to stop the free movement of people. 

    The Brits are leaving the single market, but all of us will suffer the consequences, economically speaking. It’s a lose-lose situation for everyone, from whichever angle you look at it. A reintroduction of tariffs for trade between the E-27 and the UK is almost inevitable. Tariffs will lead to a decrease in trade. This will leave the average European and UK citizen a little poorer.

    The paradox of paradoxes is that if they want to trade with the EU, the Brits will not only pay tariffs on EU goods (the same will of course also apply to UK goods in the EU) but will also have to abide by EU industrial standards.

    The despised EU-wide regulations in fact allow British firms to trade on equal terms with European companies and maintain supply chains across the continent. Leaving the single market will entail delays on the border, not least due to technical, health and safety inspections of goods, unless enlightened negotiators on both sides agree mutual recognition clauses for one another’s products (the UK government is planning to retain the existing EU regulations en bloc, and abolish individual pieces of EU legislation one by one after it officially leaves the EU, and as needed; this is a good sign and should make such mutual recognition easier).

    London will almost inevitably lose its status as a European banking centre. The City will inevitably lose the ‘passporting rights’ that allow UK financial firms conduct business on the continent without bureaucratic barriers.

    Among the tectonic political shifts, continental Europeans should remember that they need to stay united not only vis-à-vis Putin, but also vis-à-vis the UK government, which remains a crucial security ally. During Brexit negotiations, the UK may try to cut deals with individual member states to gain advantage on the shape of the future EU-UK economic relationship. It is a lose-lose situation for the EU-27 and the UK, but how much each side loses, depends on how unified and clear-sighted that side is.

    We live in strange times.

    Vít Novotný EU Member States Macroeconomics Trade

    Vít Novotný

    Britain is leaving its own creation, the single market

    Blog

    21 Feb 2017

  • I say Europe, you say…?

    Values.

    In our last interview, MEP David Mc Allister’s question to you was: “Where do you see the European Union in 20 years?” 

    With citizens who have a strong European identity and who are defending our values both inside and outside of the Union.

    What was the most interesting myth about the EU you needed to bust in your career?

    In the early 90s, the British Royal Family was not very popular and in Britain there was a rumor that the EU had a plan to abolish their Kingdom. My answer was that the British can only do it themselves. In the end, I am happy that the Royal Family is still accepted.

    What advice did you give your sons when they started doing politics?

    I didn’t give them any advice, they didn’t ask for it, they just did it.

    Recently you presented your book United for the Better: My European Way in Brussels. What do you miss most about living there?

    I had a very good time in the European Parliament and I am very thankful for that but I don’t miss Brussels.

    What is your favourite Konrad Adenauer quote?

    ‘The situation is serious but not hopeless’.

    Being at the forefront of advocating for the big-bang enlargement, what do you think are the prospects for a new enlargement?

    We need to do it very carefully because we need the backing of the people of the European Union.

    Who is your favourite movie character of all time and why?

    Miss Marple, because I like crime stories where you can also enjoy and laugh.

    What is your favourite moment from European history, depicted in the House of European History?

    The description of the change from communism to liberty in 1989-90.

    How do you think the present moment we are living in will be depicted in the House?

    As a moment of challenge which we have successfully overcome.

    What was the most awkward moment you experienced as President of the European Parliament?

    It was the signing of the Charter of Human Rights, in the EP in Strasbourg on 12 December 2007. The anti-European members created a chaos in the Parliament and the King of Jordan, Abdullah II waited to make his speech.

    What about most amusing moment?

    It could be when Dalai Lama addressed me as a ‘comrade’. I said to him: ‘Your holiness, I prefer you call me a friend’ to which he replied ‘my friend’.

    German or Belgian beer?

    German. 

    Working in Academia or in Politics?

    Politics with intelligence and emotion.

    Historical or crime novels?

    Crime novels with historical background.

    Which EPP colleague would you suggest for our next interview? What would be your question for her or him?

    I would like to ask Ramon Luis Valcárcel Siso the following question: how do you see the relations between the regions in Spain and the Spanish state in the framework of the EU? 

    Centre-Right EU Member States European Union Leadership

    I say Europe, you say…? Interview with Hans-Gert Pöttering

    I Say Europe

    15 Feb 2017

  • “Brexit and the election of Donald Trump as the new US president have brought the score to 2-0 for populism last year”, according to Member of European Parliament Eva Maydell (Paunova). “The only thing left to figure out is whether we are in the half time or only ten minutes into the game”.

    MEP Maydell, together with Martin Mycielski, Founder of the Committee of Defence of Democracy International, and Roland Freudenstein, Policy Director at the Martens Centre, were invited to discuss the resistible rise of populism in Europe, an event named after the title of the latest issue of the European View, the policy journal of the Martens Centre.

    The articles gathered under this slightly provocative title, a subtle nod to the brilliant play of Bertolt Brecht, shed light on the interaction between populist parties and conventional parties and make proposals for potential ways forward. They also discuss the role and influence of political communication , as well as the refugee and economic crises, identified as potential breeding grounds for populism.

    During the event, the speakers discussed the situation in their respective home countries. According to Martin Mycielski, the disconcerting trend is that populist communication in Poland enforces the perception that “a real Pole cannot be European”. This type of narrative promotes the division of the two identities instead of seeing them intertwined.

    In order to tackle the situation, Mycielski proposes to introduce the concept of local ambassadors to the EU. He emphasised the importance of grassroot, local level actions and communication to show people practical and positive examples of what the EU can give them.

    Populism is a relatively newer phenomenon in Germany. Freudenstein claimed Germany was “10 to 20 years behind its neighbours when it comes to developing right-wing populism”.

    Due to historical reasons rooted in the Second World War, parties such as AfD, the Alternative for Germany, and the PEGIDA movement, have only recently started raising their heads and have rapidly increased in size. Freudenstein, however, thinks it would be unlikely for other parties to form a coalition with AfD after the federal elections later this year.

    A problem in tackling populism is that people do not always understand the political solutions offered, as they will benefit Europe and people only in the long-term. When speaking in her home country Bulgaria, Eva Maydell (Paunova) likes to divide her speaking time with experts in certain fields to make the policy actions in those fields more understandable.

    Demonstrating concrete outcomes achieved in shorter-term projects is also important, just as well as the established political parties being a little bit more entertaining in their communication, as pointed out by Roland Freudenstein.

    MEP Antonio López-Istúriz White gave some sobering final remarks: “Populism is not new in history”, he said, “but today, it is different in its attempts to undermine democracy”. In order not to repeat the mistakes of the 1930s and its symbiosis with extremism, it is time to fight populism at its roots.

    Democracy EU Member States Euroscepticism Political Parties Populism

    Brexit and Trump: 2-0 for populism, says centre-right MEP

    Other News

    31 Jan 2017

  • Declining election turnouts and popular disillusionment with politics show that our political systems are being put to a test. Citizens are turning away from traditional political involvement (voting, party membership, contacting a local politician) and turning towards other forms of political participation (signing online petitions, taking up ad-hoc causes, organising demonstrations).

    With our political systems becoming more and more complex, no wonder democratic institutions are being perceived as remote by voters. In the era of internet and social media, discontent is easier voiced than solutions. The rise of populist parties can in part be interpreted as people’s attempt to revolt against processes, institutions and elected officials they no longer feel represented by.

    As a political think tank, we are continuously trying to understand these trends and to find opportunities to improve political participation. Together with our partners, EDS (European Democrat Students) and YEPP (Youth of the European People’s Party), we are launching a new ideas contest where we want to hear your concrete proposals addressing one of the 3 following fields:

    • Political parties: How would you make political parties work better (more accessible membership, more democratic, more efficient use of resources)?
    • Political institutions and processes: How would you improve democratic processes such as electoral systems, election campaigns, referendums, etc.? What should be the role of the internet in general and social media in particular for political institutions and processes?
    • Politicians: How can politicians really connect with citizens? How can they improve their image, record, etc., for example by using technological advances? 

    If you would like to participate, please choose and submit your proposal in one of the fields above. The word limit for each proposal is 500 words. If you would like to submit more than one proposal (for example, one proposal for the field “political parties” and another one for the field “political institutions and processes”, or two different proposals for the same field), you can do so by submitting each proposal in a separate document. Your proposal should have the following structure: 

    • The problem: identify and briefly describe the problem that your proposal is trying to address
    • The proposal: elaborate on your proposal, explaining the practical steps needed to implement it
    • The outcome: wrap-up by explaining the positive effects of your proposal in addressing the initial problem

    All proposals should be concrete, feasible and address national or EU politics

    What’s in it for you? All proposals will be carefully read and evaluated by our experts working on this topic. The 3 participants who submitted the 3 best proposals will win an all expenses-paid trip to Brussels to discuss with us their proposal. The best proposals will also be published on our blog and promoted on our social media channels. 

    Please send your proposals by email at yourideas@martenscentre.eu by March 1st, 2017. Please mention “Ideas contest” in the subject line of your email. 

    Good luck, we are looking forward to receiving your ideas!

    Democracy EU Member States European Union Political Parties

    If it’s broken, let’s fix it!

    Other News

    25 Jan 2017

  • I say Europe, you say…? 
     
    Peace. 
     
    What was your first job? 
     
    Serving in the German Army (Bundeswehr) for two years. 
     
    Which was the most interesting myth about the EU you needed to bust in your career? 
     
    Being a coffee drinker myself, I was amused to read in a British newspaper that Brussels was trying to restrict the drinking habits of the United Kingdom’s coffee lovers. Of course, this was not the case.

    The article referred to a study undertaken by the European Food Safety Authority, which assessed the different levels of caffeine intake. It concluded that a regular caffeine consumption up to 400mg per day is not worrisome for non-pregnant adults. The European Union never proposed to regulate how much coffee people drink. 
     
    How do you see transatlantic relations after 20 January 2017? As Chair of the US Delegation, is there still a perspective for TTIP, and, if not, what is the alternative? 
     
    The outcome of the US presidential elections was not what we expected but as with all democratic decisions, we have to respect it and work with it. Good transatlantic relations are crucial for us and we will continue to work on strengthening our partnership. At the moment, we are facing many uncertainties.

    The new Trump administration is still being formed and we will have to wait for a clear political agenda. Even before the US election, the TTIP negotiations had already been tough. Considering the President-elect’s take on trade, a comprehensive free trade agreement between the EU and the US seems rather remote.

     Soft or Hard Brexit? 

    Prime Minister May’s strategy resembles a “hard Brexit” of rigid border and customs controls to reduce migration and a British withdrawal from the jurisdiction of the ECJ. The European Union’s position is clear: the British objective of restricting the freedom of labour while maintaining full access to the Single Market tries to “square the circle”. Full access to the European market without applying the fundamental freedoms is not possible. 
     
    We noticed you have your website in 6 different languages – how much is the EU level communication important for you? 
     
    The variety of languages, cultures and traditions is what makes the European Union unique. By now, my website is available in eight different languages to reach as many EU citizens as possible. We should never get tired of explaining the EU to the people. This is why I regularly inform about my work on Facebook, Twitter and my website. By subscribing to my newsletter, you can also receive monthly updates directly in your e-mail inbox.   
     
    As a former president of CDU’s Junge Union how do you feel about lack of youth participation and overall interest in politics and what needs to be done to change the negative trend? 
     
    When I was district chairman of the Junge Union, I enjoyed the positive energy of our group. Politics affects us all in our everyday lives and it is the youth of today that will change tomorrow. I encourage young people to get involved. Programmes like Erasmus or the newly launched Interrail campaign by Manfred Weber are good initiatives to engage young Europeans.

    But there is certainly more that needs to be done. Education is key: How much do children and young adults learn about the EU at school? Often not enough. Therefore, I believe that the history of the European Union and the values it is founded on should be given more space on the curriculum. 
     
    Choose one of the following: moules frites or waffles? 

    Moules frites. 
     
    Law or Politics? 

    Politics based on the rule of law. 
     
    German or British humor? 

    British humor in Germany. 
     
    Which EPP colleague would you suggest for the next interview? What would be your question for her or him? 
     
    For your next interview, I would like to suggest the former President of the European Parliament, Dr. Hans-Gert Pöttering. He initiated the idea of a “House of European History”, which is expected to open in 2017. The question I would like to ask him would be: “Where do you see the European Union in 20 years?” 


    “I say Europe, you say…?” is a series of candid interviews with centre right movers and shakers of the European project. From legislative work to food preferences, from weekday causes to weekend hobbies, we show you the human face of EU politics and its main protagonists. 
    Centre-Right EU Member States European Union Leadership

    I say Europe, you say…? Interview with MEP David McAllister

    I Say Europe

    17 Jan 2017

  • The past year has witnessed a major shift in the relationships between the four Central European countries that make up the Visegrád Group. In matters related to migration, the members of the alliance have worked together in Brussels as a cohesive bloc throughout 2016.

    But in the wake of Brexit, simmering internal divisions have arisen within this regional alliance over the EU’s future. The Visegrád Group acts as an amplifier, an ad hoc coalition, reinforcing regional positions where they exist. Its diplomatic infrastructure and other structural factors are here to stay, but the key drivers of its stances are now domestic politics and the role of the countries’ leaders.

    In the absence of a shared vision for the future of Europe and the role of EU institutions, the honeymoon period seems to be over. A ‘conservative revolution’ in Poland has created an illiberal axis with Hungary, where a sovereigntist narrative holds sway, while the Czech and Slovak governments have maintained a more pragmatic line on the EU. The new risk is that reinventing the EU will come at the expense of (divided) Central Europeans.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Milan Nic EU Member States European Union Foreign Policy Leadership

    Milan Nic

    The Visegrád Group in the EU: 2016 as a turning-point?

    Blog

    20 Dec 2016

  • In Germany and Austria, an unprecedented political communication campaign orchestrated by a small group of well-connected politicians, green and left-wing political parties, and associated civil society organisations has evoked strong aversion among the population to the negotiations for the Transatlantic Trade and Investment Partnership Agreement (TTIP) between the EU and the US.

    Germany’s anti-TTIP groups want nothing less than to take their protests to other European countries. The network’s campaigns are largely driven by myths and fears evoked by emotive narratives and powerful metaphors. Their reasoning has strong persuasive power though. This article sheds light on who the campaign movement’s major protagonists are, the messages they spread, their objectives, and how their deceptive argumentation threatens social interaction, pluralist societies and individual economic freedom.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Matthias Bauer EU Member States Trade

    Matthias Bauer

    The political power of evoking fear: Germany’s anti-TTIP campaign movement

    Blog

    20 Dec 2016

  • Technology is transforming the world around us at a growing pace. It affects the way we live, the way we study, the way we trade, the way we communicate. And it can be disruptive. It puts into question long cherished assumptions, it makes communities more fragmented and fluid and – crucially – it can destroy jobs in the industries it challenges. Are we to conclude that the world would have been better off if we had artificially restricted the development and commercialization of trains, cars and electric devises? Obviously not. This lesson is still valid for tomorrow’s technological developments.

    It’s around these pressing issues that experts from all over Europe gathered for the 7th Economic Ideas Forum. Organized by the Wilfried Martens Centre for European Studies, the official think tank of the EPP, the EIF’s aim is to act as a laboratory for policy-oriented ideas. This year’s edition has six main takeaways to pick our brains:

    1. Keep Calm and No Basic Income

    Today, the majority of jobs in Europe are still full time, permanent positions. But labor markets are changing as technological advances and flexible working options increasingly dominate the discussion. Basic income, many people say, offers a potential solution to the emerging realities of tomorrow’s labor market. But according to one speaker, a universal basic income will simply let big business off the hook in terms of providing corporate and social responsibility. In Europe, we should distinguish between being more educated and being more skilled.

    2. Creative Bravery: Celebrating Failure, Changing Europe

    One participant quoted Nobel Prize winner economist Wassily Leontief: ‘The role of humans as the most important factor of production is bound to diminish in the same way that the role of horses in agricultural production was first diminished and then eliminated by the introduction of tractors’. We need to move towards a system in which individuals and firms can innovate ‘without permission’ as regulations often distort or prevent the creative process. In Europe, the risk reward balance needs to be reset. Failure is an option, because out of failure comes innovations which change the world.

    3. To Be Digitalized or Marginalized: That is the Question!

    The European Fund for Strategic Investments (EFSI) offers huge potential for the EU to close the digital infrastructure gap with other global economies. For this to happen, public money needs the support of private capital in order to tackle market failures. The right regulatory framework requires a light and flexible approach, allowing private enterprise to bring their strengths to the next-generation digital economy. In Europe, fierce competition is the best way to ensure lower prices and higher investments.

    4. Conscious Uncoupling: Living Happily Even after Brexit

    The success of EU integration has been constituted by the internal market and the free movement of goods, capitals, services, people. These principles constitute the basis of the market economy model. To build walls and limit freedom of movement now would be not just counterproductive but also impossible. Free movement of people and jurisdiction of the European Court of Justice are two key negotiation points. If the United Kingdom accepts these principles, an agreement may be possible. However, according to Alexander Stubb, former Prime Minister of Finland and speaker at the head-to-head session on Brexit, this seems to be an unlikely scenario.

    5. ‘Nothing is lostnothing is createdeverything is transformed’

    Fragmentation must be overcome. Only through combining the strengths of member states can the EU hope to add value at an industrial scale. European industry is going through a fourth industrial revolution: digital transformation is changing how companies do business on a daily basis. European industries still need to challenge fragmented markets, fragmented standards and fragmented national regulations. In Europe, we need to think globally.

    6. Can Cows Save Europe?

    Agricultural policy has been at the heart of EU policy since the Treaty of Rome. Research just doesn’t happen in factories and labs; it happens every day in millions of farms throughout the EU. In a time of huge global population change, land scarcity and increased environmental awareness, research and innovation in agriculture matters more than ever. For the EU, this means not just ensuring European farmers have the best knowledge transfer gained from private sector companies, but also helping farmers in emerging countries learn from our expertise. In Europe, agriculture must remain one of the most innovative and research intensive sectors in our economy.

    Agriculture Business Economy EU Member States Innovation

    Tomorrow’s Europe in Six Steps

    Other News

    09 Dec 2016

  • For Russia, business and state are indistinguishable. This was just one of the main takeaways of the event “Understanding Kremlin’s influence in Central and Eastern Europe”, co-organised by the Wilfried Martens Centre for European Studies and the Center for the Study of Democracy (CSD) on Thursday, 1 December 2016 in Brussels.

    The event started off by presenting the main findings of The Kremlin Playbook: Understanding Russian Influence in Central and Eastern Europe, a CSD report in cooperation with the Center for Strategic and International Studies (CSIS), a Washington DC-based think tank. With ample qualitative and quantitative data, the study reveals the exact nature of Russia’s economic footprint in the domestic economies of Central and Eastern European countries, as well as its amplifiers.

    “When think tanks produce publications like these, critical of Putin’s Russia, the Kremlin sees this as an existential threat”, mentioned Tomi Huhtanen, Executive Director of the Martens Centre, in his introductory remarks. Member of the European Parliament Paul Rübig, who sits with the centre-right EPP Group and is the longest-serving MEP from Austria acknowledged the importance of think tanks working together to counter Russian influence, as well as in the battle for facts in the media. 

    Ruslan Stefanov, CSD’s Economic Programme Director and The Kremlin’s Playbook project director underlined that no Russian oligarch is in a position to refuse Kremlin’s insistence and efforts to expand Russia’s economic influence, and that CEE countries are prime real estate for this influence.

    Martin Vladimirov, another expert author of the Kremlin Playbook study emphasised that for Moscow the energy dependence of CEE is almost an issue of national strategic interest and gave the example of Gazprom which has been able to exploit economic governance deficiencies in the region to its advantage. 

    “No Russian oligarch will refuse Kremlin insistence to expand Russia’s economic influence.” Ruslan Stefanov, Kremlin Playbook author

    But what makes the CEE countries so vulnerable to Russia’s attempts of political patronage? Is it capitalism, EU disillusionment or communism nostalgia? There was a deeply held assumption that, when they joined NATO and the EU in 2004, these countries would continue their positive democratic and economic transformation.

    Yet more than a decade later, the region experiences a decline in democratic standards and governance practices at the same time that Russia’s economic grip of the region is strengthening. According to Vít Novotný, researcher with the Martens Centre, these countries have been more focused on the anti-communist rhetoric and dealing with their communist past, rather than improving governance and transparency.

    With older generations slipping into old mind frames, Veronika Víchová, analyst of the Kremlin Watch Programme of European Values, a Prague-based think tank, highlighted the importance of counteracting the sophisticated disinformation strategy of the Kremlin. She maintained that cooperation among different states is key for countering Russian influence, and both NATO and the EU will need to diversify and cooperate more to address Russian soft power, including misinformation, disruption and even cyber-attacks. 

    Source: The Kremlin Playbook: Understanding Russian Influence in Central and Eastern Europe
    Economy Energy EU Member States

    CEE and Russia: when economic dependence translates into political influence

    Other News

    02 Dec 2016

  • Britain’s decision to leave the European Union and Donald Trump’s election to President of the United States are events of historical proportion. In important ways, they challenge assumptions long taken for granted by both sides of the political spectrum. We publish below various contributions on the lessons the European People’s Party should draw from these political developments.

    Contributors are broadly connected to the European centre-right and offer a wide range of opinions on the topic under discussion. Some believe that an identitarian agitation is sweeping across the West, and that the centre-right should reclaim identity politics from anti-establishment movements and reconcile it with European integration, after having neglected it for too long. Others reject this analysis, downplay identitarian factors or see the return of identity politics as a purely populist phenomenon that should be opposed by all means.   

    A Europe of values and results

    Benjamin Dalle, 

    Director, CEDER Study Centre

    The recent developments in the UK and the US are reflections of discontent of large parts of the population with what is going on in their daily lives and their feelings about the future, which led to mistrust in traditional politics and in current leaders. The Brexit referendum is for many people the proof of a failing European Union, while the US presidential elections give rise to fears about the traditional multilateral approach and the strength of our transatlantic relations.

    We believe that the EPP must emphasise the importance of delivering tangible results on all levels of government; results that improve the lives of citizens and which take into account the concerns of all EU citizens. For the EPP this will require strong leadership, vision and more unified action and opinions. Deepening and strengthening the European Union is also necessary, on the basis of our common values, such as democracy, human rights, the rule of law, solidarity and tolerance.

    The confidence and involvement of citizens will be of utmost importance to restore the ‘European Dream’. The dialogue between citizens and the European institutions therefore needs to be strengthened. That is why we believe the work of Luc Van den Brande as Special Adviser to EC Commission President Juncker to further strengthen the dialogue with the EU citizens is so important.

    Stay firm and united

    Gunnar Hökmark, 

    Member of the European Parliament

    Now it is serious. These are the times that the European Union once was founded to meet. To secure freedom, democracy and peace in Europe. To provide stability in a fragile world. To develop a dynamic economy for prosperity and social cohesion. This is not anymore about ideological speeches but brutal reality.

    It is a new world. More risky. More instable. It is the free world that is under threat and it is the world order from the years after the Second World War that is being challenged. The crises of today are not the crisis of the European Union, but it is these kinds of crises the EU was created to deal with. To give stability to Europe and give stability to the free world.

    This challenge might be the most difficult we have ever faced. It is more challenging than reforming agricultural policy, establishing the internal market or launching the service directive. It is even more challenging than fighting bureaucracy.

    The solution is simple but difficult. We must stand together, side by side. Reform our markets and deepen the internal market. Achieve an Energy union and a Capital Markets Union. Take the lead in the digitalisation of global economies. Stay firm to Russia and clarify that all parts of the Union are the European Union, be it Narva in Estonia or all the ancient capitals of Europe once behind the Iron Curtain.

    Control our borders in order to ensure that the processing of asylum procedures is worthy of civilised societies. We must strengthen our military defence capabilities in order to be able to make use of our soft powers and proceed with the enlargement when countries are prepared. Reform Europe rather than create new divisions in the EU by ever new ideas of institutional changes.

    Wanted: personalities with attitude and image

    Nico Lange, 

    Deputy Director for Political Consulting, Konrad Adenauer Stiftung

    Nobody had seen it coming. But within hours of the US presidential elections, many people apparently understood perfectly what had happened. Donald Trump’s election was heralding the start of a ‘global era of populism’, newspapers said.

    Taking a more analytical view, it is clear that there are significant differences between the US and Europe. Electoral and party systems, the media and election campaigning, personalities and the topics dominating the debate in the US do not allow any clear conclusions to be drawn for future developments in Europe. And populist parties, which have been gaining ground in Europe for some time, also differ considerably from each other.

    However, there appear to be similarities in some of the underlying conditions that have facilitated the strengthening of populist mobilisation. The anxiety of the middle classes about losing status in the course of the processes of social change has increased noticeably in affluent Western societies. Differentiation in lifestyles and individualisation combined with high levels of immigration are causing feelings of one’s culture being under threat and fears of a collective loss of identity.

    There is evidently an added factor at play in that the aging section of the affluent society in particular perceives change as an imposition. People develop a defiant stance of rejection in the face of pressures to adapt to the consequences of the global economy. ‘Make America great again’ and ‘Take back control’ are populist responses to this frame of mind, which exert great attraction through the illusion of being able to return to a simpler, more predictable and manageable world.

    Instead of shaping the future constructively, this is about recreating an imaginary past that never existed in the first place.

    Brexit and Trump clearly illustrate that what we need are personalities with attitude and a good image, who look forward to shaping the future in a positive frame of mind and can develop ‘dynamics of hope’ rather than ‘dynamics of fear’ (Jean Monnet).  Trump was only strong because of Clinton’s weakness.

    Cultural pessimism, doomsday scenarios and scaremongering have no place in Christian democratic politics. When looking around Europe, one can easily identify the leading populists. On the side of those who want to manage change with a confident outlook, Angela Merkel now stands almost alone.

    We need to move beyond political correctness

    Giovanni Maddalena, 

    Professor of History of Philosophy, Università degli Studi del Molise, Italy

    From the recent US Presidential election and from Brexit we can learn some useful lessons. First, coalitions between the mainstream centre-right and centre-left do not work. The attempt to put together all ‘responsible’ people who belong to the mainstream intellectual culture of social-democratic values and globalised economic liberalism fails because it excludes the majority of the people. This coalition is doomed because it appears as an elitist project against which everyone else rebels and wins.

    Second, we learned that we need a real left-right dialectic in order to fight the so-called ‘populism’. An Italian example will clarify what I mean. In the recent municipal elections, the Five Stars Movement won in Rome and Turin where, at the second round, the race was between their candidate and the mainstream candidate. However, in Milan, where the centre-right and centre-left parties presented two different and credible candidates, the Five Stars Movement did not even qualify for the second round.

    Third, we need to reflect about populism. In order to rebuild a successful centre-right one should look at the needs expressed by those who are voting for the so-called ‘populists’ and offer clear centre-right solutions that are distinctly opposed to the centre-left perspective. On Europe, for example, the idea of a ‘slim federalism’ that is strong on security and foreign policy but weak on internal economic regulation (real subsidiarity) should be adopted, together with a recognition of the Christian roots of Western values.

    Finally, we should stop talking about populism as if it was an undifferentiated phenomenon. Although he gathered grassroots support from people who did not feel represented by US mainstream politics, Trump is a conservative. He won regular primaries of the GOP defeating 16 candidates. He then won the presidential election with sixty million votes and he has a strong political agenda. One might like or dislike his political platform, but make no mistake, he is not the same as Marine Le Pen or Beppe Grillo.

    It’s about communication, too!

    Konrad Niklewicz, 

    Deputy Director, Civic Institute, Poland

    Both the Brexit referendum and the US presidential election have demonstrated to what extent large parts of society disapprove of the political, economic and social status quo. One conclusion seems relevant to every liberal democracy: rapidly changing patterns in communication. The total dominance of online media – with the particular importance of social media – is coming.

    Only a few years ago many believed that social media would strengthen democracy by allowing people to have a say and freely share information. This year proved that they were wrong. To a large extent, social media have become a source of misinformation, not information. Instead of strengthening public debate, they poisoned it with lies and inflammatory language. Instead of being the harbour of free speech, online-based platforms became the amplifiers of hate.

    During the US presidential election, for the first time in history, fake news outpaced real news in terms of public engagement. More voters were exposed to lies than to the truth. Millions of voters were given a false picture of events. It would be foolish to think that this did not influence their voting decisions. In the last century, when new, revolutionary media appeared – the radio and later the TV – democracies decided to regulate them.

    Democratic oversight and independent regulatory bodies were established. Laws were enacted to protect the impartiality and truthfulness of the broadcast. Like the printed press, the radio and the TV broadcasters were legally responsible for the content they aired. In case of online-based social media, no such regulations exist. We urgently need to think how to fill this void.

    Identity matters

    Dr. Žiga Turk, 

    Professor, University of Ljubljana

    The message from the success of Brexit, Trump and some so-called populist movements in Europe is that identity matters. Identity matters, as particularly the US elections demonstrated, not only the minority identities of Afro-Americans, Hispanics, Gays, feminists, etc. Majority identity matters.

    The scientific explanation comes from Moral Foundations Theory. It claims that people – voters included – often decide intuitively and not necessarily rationally. We base our intuitive decisions on six different moral foundations: care, fairness, liberty, loyalty, authority and sanctity. The progressives are generally associated with the first three of the six foundations. Conservatives, in addition, are associated with the foundations of loyalty, authority and sanctity as well.

    In his campaign Trump successfully addressed the loyalty to America and the need for authority in American leadership. Meanwhile, his running mate Mike Pence covered the issue of sanctity of American Christians.

    This is perfectly illustrated in a post-electoral tweet of Mr. Trump, addressed to protesters rioting against him: ‘Imagine what our country could accomplish if we started working together as one people under one God saluting one flag. To those of us immersed in political correctness this sounds almost like ‘ein Volk, ein Reich, ein Führer’. But Trump’s message is just a warning of what happens if the centrist democratic politicians fail to base their policies firmly on the entire spectrum of people’s moral foundations.

    The values of the liberal world order are not only democracy, freedom, respect of law and respect of people regardless of their origin, the colour of their skin, their religion, gender, sexual orientation or their political beliefs. Our common values also include loyalty to our culture, love for our homeland and respect of our traditions and religions.

    It is the unique task of conservatives in general and the EPP in particular to bring those values back into the liberal world order in a positive and constructive way. The socialists and the liberals will not accomplish this because they lack intuitive understanding of it. If the EPP does not do it, someone else will. And then it will not be benign.

    This balance of values is a unique contribution for preserving the world as we know it, a contribution that only the EPP can and therefore should make.

    WMCES Editor Brexit Centre-Right Elections EU Member States EU-US Values

    WMCES Editor

    Brexit and Trump: lessons for the centre-right

    Blog

    30 Nov 2016

  • Over the last two years Germany has experienced a significant growth of nationalist, anti-Islamic and xenophobic forces. While the movement Patriotic Europeans Against the Islamisation of the West (Patriotische Europäer gegen die Islamisierung des Abendlandes, PEGIDA) has been mobilising protest on the ground in the Saxon capital, the Alternative for Germany (Alternative für Deutschland, AfD) has continually increased its number of seats in state parliaments, with a fundamental rejection of the refugee policy of the federal government.

    Since the election of a new leadership of the AfD in the summer of 2015, one can observe signs of rapprochement between these two organisations. In this paper I argue that the AfD and PEGIDA are two sides of the same coin. Further approximation and collaboration will depend on the outcome of lasting internal power struggles inside the AfD.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Karsten Grabow Elections EU Member States Euroscepticism Populism

    Karsten Grabow

    PEGIDA and the Alternative für Deutschland: two sides of the same coin?

    Blog

    29 Nov 2016

  • The EU is facing its biggest threat yet—a crisis of European identity. As member states fall into the hands of Eurosceptic and nationalist regimes, for many the future of the Union seems hopeless.

    People are disillusioned, failing to see the added value in the community of nations they once voted to join. Institutions are struggling, unable to regain their citizens’ trust, or even to reach them at all. This new crisis requires a new way of thinking—instead of supporting the institutional machine, the EU must support the people.

    It needs to place trust in the awakening civil society, endorsing and funding grass-roots movements such as the Committee for the Defence of Democracy, which in a matter of days managed to ignite the biggest mass protests in Poland since the fall of Communism.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Martin Mycielski EU Member States European Union Euroscepticism

    Martin Mycielski

    The crisis of European identity and awakening of civil society

    Blog

    11 Nov 2016

  • This article analyses the causes of the loss of support suffered by Podemos in the elections held on 26 June 2016. In these elections, the party, led by Pablo Iglesias, ran for office in coalition with the United Left.

    The article describes the way the election developed for Podemos, analyses the shaping of its populist rhetoric in line with a radical left-wing view, discusses the social and political conditions that favoured its rise, and finally, notes that the disappearance of these conditions jeopardises its chances of success in the future.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Javier Zarzalejos Centre-Right Elections EU Member States Political Parties Populism

    Javier Zarzalejos

    Populism in Spain: an analysis of Podemos

    Blog

    08 Nov 2016

  • Since its birth in 2009, the Five Star Movement has achieved incredible growth, accompanied by important electoral successes. This has resulted in concrete responsibilities and influential positions in the system. Grillo’s movement was born as an anti-system and populist force with interesting peculiarities, and the main challenge it is now facing is to prove itself able to govern and to transform problems into solutions.

    So far the promised revolution has not taken place: a mixture of inexperience, internal divisions, scandals and contradictions has already damaged the image of the movement, which is facing many challenges and a difficult transition. The evolution of the Five Star Movement shows all the weaknesses of populist movements facing reality. The best strategy to confront them is to ensure that all their contradictions emerge and, at the same time, to regain the citizens’ trust by providing credible solutions to their problems.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Margherita Movarelli EU Member States Political Parties Populism

    Margherita Movarelli

    From dreams to reality: the challenges of Italy’s Five Star Movement

    Blog

    07 Nov 2016

  • One of the universal components of jokes throughout the world is a form of cognitive dissonance, as communication scientists would call it: the confusion caused by talking at cross-purposes. It is usually the result of two people saying the same thing, but meaning something completely different. Take, for example, John Cleese’s unforgettable 1970s’ serial Fawlty Towers. 

    Among German viewers the most popular episode is, unsurprisingly, ‘The Germans’ (YouTube 2009a). Briefly, Basil (Cleese), the manager of an eccentric hotel called Fawlty Towers, is expecting a group of German guests and exhorts his staff ‘not to mention the war’, no matter what. But after an unfortunate encounter between his head and a frying pan, he himself develops a maniacal tendency to bring up the subject so embarrassing to his politically correct post-war German guests.

    Hence, when he screams at the Germans not to mention the war, and they protest that they (the individuals) didn’t start ‘it’ (the subject), he shouts back, ‘Yes, you [meaning the country] did [start the war]—you invaded Poland!’ At which point the German men get angry and the women burst into tears (clichés can be funny too).

    Looking at cross-Channel communication preceding the Brexit vote, one cannot help but think that some form of cognitive dissonance must have taken hold here a long time ago. To us Continentals, British Euroscepticism, which pre-dates the days of Margaret Thatcher, has acquired a laughable quaintness, alongside eccentric lordships, outdated social hierarchies, and the economic and technological backwardness that, in our view, is associated with a Britain stuck in the glorious past of Empire and the Second World War.

    What we constantly overlook at our peril, however, is that in the eyes of many of the Leave campaign’s leaders, things are entirely the other way around. From this point of view the Continent is seen as stuck in a twentieth-century welfare-state mentality, the EU is primarily seen as an instrument that protects citizens from global competition and Europeans still believe in replacing Europe’s nations with a Brussels-based super-state. In contrast, Britain is considered to be more in tune with the less-regulated emerging economies of other continents and the persistent reality of nation-states.

    Long-standing Eurosceptics such as Dan Hannan, Liam Fox and Boris Johnson offer good examples of this mentality. Of course, the Leave campaign also fed on conspiracy theories, anti-elite rejectionism, and fears of immigration and globalisation. But apparently these contradictions did not do the campaign any harm. While managing the Brexit negotiations, the remaining 27 EU member states should remember to keep an eye on the cognitive dissonance that has characterised the debate on Britain’s relations with them, pre- as well as post-Brexit.

    There is also confusion in the context of the Brexit debate which directly involves another timeless Cleese classic: the film The Life of Brian. In one of its most famous scenes, Cleese, as the leader of the People’s Front of Judea in Roman-occupied Palestine, theatrically asks his acolytes, ‘What have the Romans ever done for us?’ (YouTube 2009b)—implying that the obvious answer is ‘nothing’.

    However, one after the other, the rebels come up with a series of important societal, technological and infrastructural improvements which, taken together, depict the Roman Empire as a benign hegemon intent on bringing progress. This meme was used in spring 2016 in a brilliantly acted clip about the European Convention of Human Rights (ECHR) (YouTube 2016). Here the Eurosceptic refrain ‘What has the ECHR ever done for us?’ was answered by an ever-growing list of civic rights and freedoms which are guaranteed by the Convention.

    This, by the way, has nothing to do with the EU, but was particularly popular among Remain campaigners. The clip went viral a few weeks before the referendum. The problem is the obvious reply by a Eurosceptic: that of course, these rights and freedoms do represent indispensable elements of Western modernity—but for the ECHR to be able to guarantee them, it has to be backed up by nation-states with their constitutions, administrations, judiciaries and—ultimately—armies. So who is really guaranteeing civic rights?

    Sometimes the comical aspects of confusion are best enjoyed in full awareness of their everlasting presence in political debates.

    This piece originally appeared in the December 2016 issue of the European View, the Martens Centre policy journal.

    Roland Freudenstein EU Member States

    Roland Freudenstein

    Joke theory

    Blog

    07 Nov 2016

  • This article looks at how the Greek, German and British press have addressed the issue of the refugee crisis in Europe. Using a mixed research approach that combines corpus linguistics and discourse analysis, this article examines 1340 articles that were published online between 20 March and 31 May 2016 in Greece (KathimeriniTo vima), Germany (Die WeltSüddeutsche Zeitung) and the UK (The GuardianThe Telegraph). The results presented by this article suggest that the press in all three countries mostly presented the refugee crisis in numbers. Geographical qualifiers were also deployed in the effort to broach this thorny issue, while the managerial aspect of the refugee crisis, the critical issue of child refugees and the EU–Turkey agreement were all among the most frequent topics covered by the press.

    Read the full article in the December 2016 issue of the European View, the Martens Centre policy journal.

    Stergios Fotopoulos Crisis EU Member States Mediterranean Migration

    Stergios Fotopoulos

    Media discourse on the refugee crisis: on what have the Greek, German and British press focused?

    Blog

    07 Nov 2016

  • ‘It would have been easy if it had been a clean break’, stated Gunnar Hökmark MEP (Moderaterna, EPP), opening the discussion. ‘The problem is that we are going to live in the same house’, he added, referring to the global issues of climate change, the need for financial and economic stability and foreign policy with China and Russia, which require European collaboration.

    It would have been easy if it had been a clean break

    ‘How to secure a friendly Brexit?’ was a question asked in an event organised by the Wilfried Martens Centre for European Studies and Open Europe on 13 October 2016. Centre-right Swedish MEP Gunnar Hökmark and industry representatives from both the UK and continental Europe were invited to discuss what is at stake in the negotiations and the UK’s relationship to the Union after the termination of the membership. In order to achieve common goals, establishing good EU-UK relations after Brexit is important, Mr. Hökmark stated.

    According to German entrepreneur Kai Büntemeyer, director of a manufacturing company Kolbus with important interests in the UK, the results of the UK referendum can already be seen in the UK’s and EU’s economies. Many investment projects are on hold. In order to prevent further damage, ‘We must help the UK to get the best possible one foot in, one foot out – deal. Anything else would be a complete disaster’, he argued. Britain should not be punished by hard Brexit terms.

    The British panellists Parisa Smith (Director of EU Affairs, BBA) and Stephen Booth (Director, Open Europe) agreed that there is a lot at stake when it comes to geopolitics and economic consequences. However, according to Mr. Booth, it is important to remember that ‘the public in the UK has decided to reject political integration, not engagement in wider challenges facing Europe’. The result of the vote should ultimately be respected. The next step is for both parties to establish what kind of relationship they wish to maintain before focusing on the details of the Brexit terms. After that, Ms. Smith noted, the negotiators must stay pragmatic and work together to find a beneficial deal for both sides.

    In the Q & A part of the event, the potential model for the post-Brexit EU-UK relationship was discussed. The already existing examples of Iceland and Switzerland were not seen favourably among the panellists, as the UK specificities seem to require an innovative model.

    An important conclusion was that Brexit should be understood as the sign of an anti-globalisation trend currently taking hold of Europe and the West. For Mr. Hökmark, the key issue from now on is to fight populism. The success of Britain’s leave campaign demonstrates that appealing to the emotions of the public is a powerful tool. In an effort to come to a friendly Brexit, we should not underestimate the role of emotions and the need for decisive leadership.

    Economy EU Member States European Union Euroscepticism

    How to secure a friendly Brexit?

    Other News

    18 Oct 2016

  • With economic growth not expected to exceed 1.6% up to 2017, a debt to GDP ratio predicted to peak at 106% in 2016, coupled with established labour market challenges, the country remains extremely susceptible to further economic external shocks. This event on 12 October 2016, entitled ‘Belgium: Reforms for Growth?’, was part of a common project with the Wilfried Martens Centre for European Studies and CEDER, aimed at discussing the current state of Belgium’s economy.

    Following attempts to adhere the Commission’s three overarching recommendations relating to fiscal reform, labour market reform and competitiveness, Javier Yaniz Igal of DG ECFIN noted that there is now a risk of significant deviation from the adjustment for 2016’s and 2017’s forecast. Belgium’s tax shift, which Javier emphasised is progressing in the right direction, does not appear to be neutral, further illustrating that there is still considerable scope for improving the designs of the overall tax system.

    Although some improvements have been made in the overall functioning of Belgium’s labour market, said Javier, underutilisation of labour – especially among low-skilled, young and older works and people of migrant backgrounds – continues to undermine the economy. Further measures are therefore needed to ensure compliance; to meet the recommended targets and to get Belgium’s economy back on track.

    Department of Economics Professor of the University of Ghent, Koen Schoors, suggested that in order to understand Belgium’s economy, we need to understand how exactly we ended up here. Globalisation has been mismanaged on a global scale, resulting in significant income disparity not only in Belgium, but across Europe and the rest of the world, including the UK, Spain and Germany.

    Koen agreed with Javier that the tax shift being implemented in Belgium is indeed essential, particularly away from labour and instead on consumption, waste and sugar, etc. as well as capital – which is not being taxed enough, or in some cases at all.

    Ultimately, what is needed for Belgium is a long-term plan, he proposed; a roadmap, with all stakeholders, in order to create incentives and improve competitiveness. Failure to do so will almost certainly result in the killing of investments and prolonged stagnation of the economy.

    The political perspective offered by Belgian Member of European Parliament Tom Vandenkendelaere presented Belgium as an exceptional case, encompassed by the slogan ‘only in Belgium’. Regional disparities and a high level of government instability culminate in a very unique political landscape, he said, something which needs to be addressed in order to improve the confidence of Belgians, expats, investors and entrepreneurs.

    According to Tom, economically Belgium is not doing explicitly bad, referring to the implementation of the Commission’s recommendations on fiscal reform, Belgium’s labour market and chronic stagnation. However, he acknowledged that Belgium frequently faces challenges which need to be addressed, including areas like retail liberalisation, as well as government communication and crisis response, with the latter two being highlighted by the 22 March 2016 attacks in Brussels.

    What is needed for Belgium is a roadmap on how to improve coordination, competitiveness and encourage investment. MEP Tom Vandenkendelaere

    Agreeing with Koen, Tom stressed that what is needed for Belgium is a roadmap on how to improve coordination, competitiveness and encourage investment, adding that investing in education is also essential in order to sow the seeds for future generations. Most of all, Tom advised, what we need in Belgium is to foster trust.

    During the Q&A session several particularly pertinent issues were raised, most notably on how to better regulate/deregulate the various Belgian sectors, how to reduce the constraint of Belgian banks and finally, what can be done to improve the investment environment of Belgium and its and overall competitiveness.

    The panellists were in agreement that a long-term roadmap which responded to such queries, capitalised on Belgium’s strengths while addressing its weaknesses, was indeed the best method moving forward. They concluded that government stability was also imperative for delivering and following through on that roadmap.

    Economy EU Member States Macroeconomics

    Progress made on reforming Belgium’s economy, but long term road map required

    Other News

    14 Oct 2016

  • Professor Lars Jonung warning Sweden’s current economic momentum is unsustainable

    According to economy expert Lars Jonung, the two drivers of the Swedish economy, expansionary monetary policy and the very loose fiscal policies that had led to over 20 years of continuous property price growth are likely to result in a real estate bubble based on credit expansion.

    Jonung, who is a Professor Emeritus with the Knut Wicksell Centre for Financial Studies at Lund University, made his remarks during an event organised on October 11, 2016 in Brussels by the Martens Centre as part of its Food for Thought Country Series.

    Professor Jonung argued that monetary policy cannot correct this trend by itself, but only in combination with fiscal, tax and regulatory policies. The Country Series events are designed to provide a discussion of the economic challenges facing member states in the EU.

    Sweden’s economy grew by 3.6% in 2015 making it one of the fastest growing economies in the EU.  According to European Commission data, in the short to medium term, economic prospects continue to look favourable with growth projected to moderate to 2.9% by 2017. Unemployment is projected to fall under 7% in 2016 with government debt stable at around 44% of Gross Domestic Product (GDP).

    However, the Swedish economy faces a number of downside risks which jeopardise future growth potential. The arrival of over 160,000 refugees in 2015 poses longer term challenges regarding labour market integration.

    To counter the rise of populists, the centre-right in Sweden will have to come up with long-term solutions and alternatives. MEP ​Gunnar Hokmark

    Brexit and the potential for weaker growth among key trading partners also poses external risks. Internally, the dramatic rise in house prices and household debt is complemented by expansionary fiscal and monetary policies at government level, including negative interest rates.

    To the question “Has Sweden reached the point of no return?”,  Jonung cited American economist Robert Aliber, who had in the past stated that a large number of building cranes on a city’s skyline was the sign of an upcoming crisis. “In Stockholm there are too many cranes”, Jonung concluded, “however a number of changes can still be made to give us a soft landing”.

    Swedish Member of the European Parliament Gunnar Hokmark, also a speaker at the event, disagreed with Professor Jonung on the crane phenomenon, arguing that in order to cope with the high demand of housing in Stockholm, both a rise in prices and more construction is necessary.

    According to him, addressing the challenges in the supply side of the economy is what Sweden needs. “Contrary to what many think, we are not a socialist country anymore, we are quite liberal. However, deregulation in the housing and the labour market are still needed”, MEP Hӧkmark stated.

    Fredrik Erixon, Director of the European Centre for International Political Economy, a Brussels-based think tank, shared a rather pessimistic view about the future of Sweden. According to him, the Central Bank is the main source of monetary distortion. “Free money leads to a misallocation of resources, which will come back at some point and bite Sweden in the back”, according to Erixon.

    During the Q&A session, several other points were raised such as managing the current levels of growth in a more sustainable way, investment and deregulation, as well as lessons learned from Ireland, Spain or Greece over the past decade.

    The political consequences of any future economic slowdown were also raised, specifically how such a slowdown could strengthen populist political parties. A key issue raised by the panellists was that traditional centre-right political parties need to propose new solutions to combat the current economic imbalances.

    Household debt in relation to disposable income in Sweden, the UK and the US, 1995–2014, with the Riksbank’s forecast for Sweden until 2019
    Business Crisis EU Member States Macroeconomics

    Finance expert: Sweden’s booming economy not what it seems

    Other News

    13 Oct 2016

  • A remarkable degree of consensus has emerged in the “Brussels Bubble” regarding the recent Commission decision against Ireland’s alleged tax (or rather non-tax) agreements with Apple. The issues of tax fairness and equality – as highlighted in recent years by Wikileaks and the subsequent Panama Papers – have strengthened the hand of the EU in seeking to ensure that all multi-national companies do not benefit unduly from gaps in international tax laws.  This is a policy supported by the vast majority of European citizens.

    However, the ferocity of the response from Dublin regarding the recent Commission decision highlights that there is another side to this debate which must be considered. For a small member state such as Ireland (perhaps the most open economy in Europe) the Commission decision is symptomatic of an EU bureaucracy that is steadily encroaching on areas of national competence. 

    The use of state-aid policy to retrospectively challenge national taxation policies is not how the EU usually does business. Nor (as recent revelations from Irish policymakers highlight) can the Commission decision be divorced from the reality of Brussels decade’s long campaign to force Ireland to increase its business taxes.

    From Dublin, the recent decision highlights the increasing ability of larger member states (generally high tax, high social spending economies) to impose their priorities on smaller, more flexible economies. There are many reasons why Ireland was able to return to growth so successfully after the 2010-13 bailout. 

    Having an economy characterised by inflexible labour laws; an investment climate restricted by high business taxes and poor labour mobility are not among them. Yet, these are exactly the characteristics of some of the member states now seeking to impose higher taxes in Ireland.

    There is a much wider context to be considered regarding the Apple decision. In particular, three key points are relevant:

    • Everybody – in the EU and Ireland – believes that companies, both large and small, should pay a fair rate of taxation. What is required is a global solution that includes the problematic issue of reforming the US tax code.  Taxing global companies is not like selling cookies at the weekend market. Global consensus is required for meaningful global action. Through its recent actions the Commission have undermined the valuable work being undertaken by the Organisation for Economic Co-operation and Development (OECD) through its Action Plan on base erosion and profit shifting. 
    • Taxation, including corporate taxation, remains a national competence in the EU.  However, the concept of harmonising corporate tax rates has been an objective of the Commission (and some member states) since the 1960s.  Whereas smaller member states focus on flexibility, larger states tend to focus on scale as a competitive advantage. The feeling in Ireland is that by cleverly merging the issue of tax fairness/evasion with that of corporate tax harmonisation (through initially proposing a relatively harmless consolidated tax base) the Commission is attempting to finally achieve its long term objective. Let’s be honest, the Commission’s case is not about how much tax Apple pays, it’s part of a longer term political game concerning which (larger) government gets a bigger share of the cash. 
    • The centralising tendencies of the Commission (and some larger member states) spell economic disaster for many of the EU’s geographically peripheral members.  The continental economic model of very high taxation (both personal and business) is not a model that is desirable for more Anglo-Saxon influenced economies like Ireland and the Baltic states. Italy, Germany and France all choose to have headline corporation tax rates of 29%-33%.  In Ireland the long established rate is 12.5% and the average for the Baltics is under 17%.  Corporate tax competition at a national level is vital for a healthy EU economy.  The use of state aid rules to retrospectively over-ride national vetoes will reduce investment in the EU (especially in more open, peripheral economies lacking large capital bases) and reduce the attractiveness of the EU as global investment location.  Perhaps Commission officials should talk to Airbus and Volkswagen to find out about the importance of state level incentives in Alabama and Tennessee respectively. 

    So what solutions can the centre-right in Ireland offer to these wider issues?

    • First, we should restate our commitment to real tax fairness.  That is in redesigning the global tax system to ensure that all companies pay what is due. We should underline our commitment to global efforts in this regard.
    • Second, the concept of national competence over taxation policy should be restated and we should support the concept of corporate tax competition as being vital to the healthy development of a balanced European economy.  In a current environment characterised by rising populism and Euroscepticism are future moves to establishing more fiscal integration really desirable (and politically achievable)?
    • Third, we need to take a leading role in combatting the rise of protectionism and anti-American feeling across the EU.  Although it is sometimes hard to remember given the prevalence of such feelings in Europe, the US is Europe’s most important economic and security partner. 

    It is easy for those of us in the “Brussels Bubble” to support making big companies pay their fair share of taxes and to accuse Ireland of illegal behaviour. But, to do so misses the much bigger picture.

    Eoin Drea Business Centre-Right EU Member States

    Eoin Drea

    The European Commission, Apple and Ireland: the view from the Emerald Isle

    Blog

    07 Sep 2016

  • Most analyses of the Brexit vote agree that immigration played a major role in the outcome of the referendum. What is interesting is that, next to extra-European immigration, the British debate was equally (if not more) preoccupied with intra-EU mobility – EU citizens coming to the UK to live and work.

    What can mainstream politicians in Europe learn from the British debate and the ways mobility is instrumentalised by Eurosceptics?

    Populist parties have already tried to politicise intra-EU mobility in Italy and the Netherlands, and are expected to do so more pronouncedly in France and Austria.

    In these (and other) old member-states, mainstream parties – especially of the centre-right – seem tempted to address free movement as a problem in need of reform. Brexit seems to send the message that this is necessary, lest populists take advantage of popular frustrations.

    I believe that the lesson from the UK referendum is exactly the opposite. By accepting the politicisation of free movement, mainstream parties play upon the populists’ strategy to merge their two staple issues, immigration and Europe, and present exit from the EU as a solution to immigration.

    The rise and fall of David Cameron should be a cautionary tale about tampering with intra-EU mobility, even if addressing external immigration is something centre-right parties should do.

    The story begins with David Cameron’s pre-electoral promise in 2010 to reduce net immigration to the UK to the ‘tens of thousands’, a promise that came back to haunt him. Given that almost half of that net immigration is made up of EU citizens, it was inevitable that EU free movement would acquire political importance.

    In the years between Cameron’s entry to power and the calling of the referendum, UKIP and Eurosceptic Tories raised the issue of benefits for EU migrants. In 2015 traditional fears with external immigration became entangled with the EU due to the refugee crisis. The Eurosceptic press reproduced ad nauseam images from Calais and explicitly linked them with EU membership.

    In response to the social benefits controversy, Cameron made free movement a key aspect of his renegotiation package with the EU in 2013. In the 2015 parliamentary election campaign his implicit promise was that the threat of the referendum would extract concessions from the EU to curtail immigration from the EU. Ultimately Cameron secured mild changes in his deal with the EU that were predictably decried by the Eurosceptic right as too weak to dissuade free movement.

    A few months before the renegotiation deal, Cameron had pledged to accept 20000 Syrian refugees, thus intensifying popular concerns that EU membership meant deeper entanglement of the UK in Europe’s refugee woes.

    If it is true that Cameron decided to accept Syrian refugees in order to placate Angela Merkel and other Europeans to get a better deal on UK membership, it becomes obvious what kind of mess he had dug himself in with regards to mobility.

    In this context, the potential for Eurosceptics to mutualise hostility towards the EU and fear of immigration in the referendum campaign was infinite. Tory Leavers claimed that with European migration reduced the UK could attract more people from the Commonwealth.

    Brexiteers of the right and of the left exploited the frustrations of working class people, including many of ethnic background, by promising that reduced immigration from Europe would lighten the burden on public services.

    And the populist right could for the first time sound practical when speaking about immigration. The solution was obvious and handy: leave the EU.

    What does this mean for the rest of Europe? In the UK, an already difficult situation became impossible when mainstream politicians accepted that EU free movement is a subset of immigration and the sociocultural concerns usually associated with it.

    The message to mainstream, and especially centre-right, politicians elsewhere in Europe is that, even if free movement does pose some practical problems, tampering with it offers very few immediate gains and many long-term risks.

    For parties that campaign in favour of European integration, nitpicking on the EU legal edifice undermines their credibility. Accepting that ‘something must be done’ about free movement allows populists to present exit from the EU as a magic bullet that can solve immigration.

    Calling for reform of free movement politicises and securitises internal borders, while what the EU should be aiming for is strengthening internal unity by building a more secure external border.

    Pro-EU parties must delegitimise and neutralise any effort by populists to politicise intra-EU mobility and free movement. Free movement and extra-EU immigration must be presented as two very different things.

    Mainstream parties must respond to popular concerns about immigration and security by stressing the need to defend and safeguard the external European border. Strengthening internal borders is inconsistent with effective management of extra-EU immigration because the latter can be effectively handled only if European states cooperate with each other.

    The EU is currently perceived as too porous externally and this strengthens the instinct to retrench behind stronger national borders. But solidarity and identity in political systems is created only when there is closure externally and openness internally.

    Pro-EU politicians must focus on making the EU external border safer. This is no easy task, but trying to score political points by talking about free movement as ‘immigration’ and by renationalising internal borders is naïve and dangerous.

    Angelos Chryssogelos Brexit Centre-Right EU Member States Euroscepticism Immigration

    Angelos Chryssogelos

    Confusing immigration and free movement: lessons from the Brexit case

    Blog

    26 Jul 2016

  • The result of the UK’s EU referendum has provided impetus for European political parties to rethink their communication strategies.

    The referendum result came as a shock here in Brussels because many of us in the Remain camp probably couldn’t name a single individual who would have voted for Leave. By the same logic, there are likely communities in England I could visit to become the only Remainer in the village.

    Once upon a time, in the days before Facebook, we revelled in finding like-minded souls.

    It was the British novelist CS Lewis who quipped that “Friendship is born at that moment when one person says to another: “What! You too? I thought I was the only one”. Today, however, it has never been easier to connect with people with whom you share common ground.

    In the internet age, we are surrounded by like-minded people. We tweet into echo-chambers, we take selfies to ‘get likes’ or we delete the posts if we don’t. We’re increasingly surrounded by Yes Men and Women and we’re unconsciously isolating ourselves from the rest of the world.

    As we reverberate in the Brexit aftershock, when we find ourselves asking ‘how did this happen?’ or ‘who voted to Leave?’ it is my opinion that we actually need to ask ourselves why didn’t we see this coming?

    Enabled by over-sharing, algorithms and trending topics, the echo-chamber as a concept is flourishing.

    To sum it up, it involves like-minded people sharing like-minded views and circulating contentedly and uninterrupted in like-minded circles. Whether espousing moderate centre-right values or advocating for attributes found elsewhere on the political spectrum, as we scroll through our social media feeds, in search of ‘likes’ or distributing themwe find ourselves increasingly unable to distinguish like from maybe too alike.

    The UK referendum, in this regard, is a wake-up call. Populist ideas must be addressed and this has to be done not with a giant POPULIST rubber stamp aimed at silencing the conversation, but by listening to the concerns of voters and effectively communicating the positive value of the European project.

    By virtue of the very nature of our echo-chambered existence, most of the people reading this blog will probably agree with me. That’s all well and good but ultimately we should seek to employ the echo-chamber to our advantage. There are two things we need to do. The first is instrumental in achieving the second. We need to utilise the circular nature of the echo-chamber in which we revolve to remind ourselves of the following message;

    The European construction is exactly that, a construct, and it is ours to build. The remaining 27 member states, their political parties, and our political family in particular, are under no obligation to subscribe to the British motto of Keep Calm and Carry On and to shrug our shoulders in the difficult discussions which will soon take place on the future of Europe and the need for reform. We do not need to ‘take back control’ because we already wield it but we do need to utilise it to strive for the Better Europe called for by Commission President Juncker.

    Once we have realised this, and structured our vision for an EU of 27, we need to break the sound barrier and defy the limits of the echo-chamber. This will involve sensible, sensitive discussion and debate. It is the role of everyone from think-tanks and political parties to ordinary citizens to recognise that we do not exist in a vacuum and that the opinions and ideas of others are to be listened to with respect because they serve to better inform us about Europe and our world.

    At the individual level, it is easy to break out of the echo-chamber. You can follow those whom you sometimes disagree with on Twitter or pick-up a newspaper different to your regular Sunday read. For political parties and think-tanks, it’s slightly more nuanced. A balance has to be found in order to avoid preaching, propaganda, or worse again, spam.

    Communication strategies have to be clever, they need to adapt to new media, embracing visuals, videos and Vines. There’s nothing to say a political party can’t SnapChat or Boomerang either. Aside from adding madness to the method, it is content that remains key. Twitter has grown its empire on the intrinsically human art of storytelling. Today more than ever people are hungry for narratives. Political think-tanks can offer genuine, credible narratives – not only about how we would like our world to be, but also about how it can be achieved. Reaching out to citizens beyond traditional circles can help to create a healthy diversity of narratives on the future of Europe.

    The European project has suffered from preaching to the converted for a little too long. Looking forward, the only ‘–exit’ on the horizon should be from the problematic depths of the politically divided echo-chambers. It is imperative that we create one inclusive conversation on the EU, unless we wish to succumb to the same fate of self-interest and repetitiveness that ultimately saw the end of Narcissus, and his estranged lover, Echo.

    Erica Lee Brexit Democracy Elections EU Institutions EU Member States European Union

    Erica Lee

    The Brexit Echo: how to break the “echo-chamber” effect in political communication

    Blog

    06 Jul 2016

  • Most, if not all, economic transactions are digitized to some degree. Most, although not all, enterprises use digital technology in some part of their business. Many, though still far too few, people use digital technology to make their lives richer and easier in everything from shopping and online banking to online dating or streaming music and films.

    Accordingly, it is becoming increasingly hard to separate the digital economy from the non-digital one. Rather, the digital economy is the new economy, and the ambition to establish a European Digital Single Market (DSM) is the aspiration to realize an improved single market that makes use of new technologies. This is what makes fulfilling this goal both extremely complicated and very simple.

    Rather than a bombastic revolution, digitization has been a silent, low key integration process moving horizontally through our economy and society. That is, until now. We have now reached a critical point, having realized that digitization has been embedded into most, if not all, parts of our lives.

    Accordingly, a lot is changing as new technologies are no longer just being used to do things the way they have always been done, but also to do things in completely new ways. The song has been separated from the CD, bloggers compete with journalists, a mobile gaming company is worth more than a car manufacturer and our cities are being transformed by apps. Times are changing.

    Based on our examination of the process of digitization and digital market integration in Europe, we highlight five specific policy issues that are crucial to promoting a lasting digital economy in Europe. 

    These areas include the need for harmonized regulation; making data borderless and data flows seamless,  promoting regional, bottom-up, controlled experimental policy initiatives; growing urban digital markets where digitization and density accelerate innovation, and establishing an open, coherent framework for data ownership with regard to privacy, personal data and metadata.

    In particular, we highlight urban digital markets as a unique opportunity for the EU (and member states) to improve the policy response to digital and disruptive entrepreneurship.  Used properly, these markets can generate substantial growth and innovation while aiding the transition to a sustainable and world leading European Digital Economy.  A rewired Europe fit and able to compete in the 21st century global economy.

    EU Member States Innovation Internet Technology

    Rewiring Europe: Five Priorities for a Lasting Digital Economy

    Research Papers

    29 Jun 2016

  • Ireland (that is the Republic of Ireland) is a small open economy that attracts investment and trades with countries from around the world. It is a pro-European, Anglo-Saxon economy with strong US influences. Ask most Irish people if they are more comfortable in Boston or Berlin, in Perth or Paris and the overwhelming response will be a recognition of Ireland’s positon within the wider “Anglo-sphere”. 

    Irish people tend not to understand how economies can even function with personal tax rates exceeding 50% of relatively low incomes. Irish people also don’t understand how some other EU member states seem to fear non-EU investment or are slow to realise the benefits of attracting workers from all over the world. As a small country dominated by your larger neighbour you learn to look outward at the possibilities on offer, rather than always seeking to protect old historical legacies.

    For Ireland, Britain leaving the EU is a disaster. Politically, economically, culturally and socially. Since 1973, both Britain and Ireland have used EU membership to grow a peace and reconciliation process in Northern Ireland, to remove borders and increase trade. Ireland could never enter Schengen without Britain, our Common Travel Area with the UK predates membership of the EU and indeed the declaration of a republic in 1948. 

    Ireland’s current close relationship with Britain seems far removed from a relationship that for centuries was dictated by violence and bigotry. It is in this context that the position of the main unionist party in Northern Ireland supporting Brexit should be viewed with concern and despair. As should nationalist calls for a referendum on Irish reunification.

    The Anglo-Irish relationship in 2016 is about much more than trade or jobs or passport checks.  It is about reconciling a bloody (and often despicable) past within the framework of European integration.  With Britain out of the EU, Ireland’s view towards Europe will change. Ireland’s view must change.


    “For Ireland, Britain leaving the EU is a disaster. Politically, economically, culturally and socially.”


    In the short to medium term, the Irish government must press both EU members and the British government for special arrangements that reflect the interlinked nature of the Irish and British economies, both economically and politically. For Ireland, the advantages (or in previous times, the disadvantages) of proximity to Britain reflect not just economic priorities, but the cultural and social closeness of their development within the British Isles.

    For Ireland, the approach to further European integration must be balanced by a consideration of the relationship with Britain. In a sense, the Irish view of Brussels must become more nuanced and more challenging of how any further proposals will impact upon shared Anglo-Irish priorities. 

    Ireland must seek to become a bridge between the EU and a non-EU Britain.  A bridge which could (and should) be utilised by the European Union in the coming negotiations in order to seek the most amicable and beneficial new settlement for all parties. Anything else will draw into doubt the very real achievements of the last four decades of EU membership

    The Irish have a complicated relationship with the English. Unlike the relationship with the Scots or the Welsh, with the English the commonalities are harder to find, although cultural and social familiarities remains the same.  History can be a slow beast to retreat into the shadows. Now is not the time to give up this fight.

    Eoin Drea Brexit EU Member States European Union

    Eoin Drea

    Why Brexit changes everything for Ireland

    Blog

    28 Jun 2016

  • As the shock waves continue to pass through Europe following the UK referendum, it is easy to draw a long list of mistakes that UK leading politicians have made. It is equally simple for continental Europeans to place the blame solely on the British and shake their heads at the referendum results.

    Already before the referendum, there was a school of thought within the EU that if Brexit happened, the separation should be as painful as possible in able to make sure that no other member states would follow suit. The more isolated the UK would be, the better it would be for European unity, or so the logic goes. However great the temptation towards an angry response, to punch back even, is, it will not help Europe or the EU – nor is it justified.

    First of all, the dynamics that led to the disappointing result of UK referendum exist in other EU member states. In fact, there is no guarantee as to how other member states would vote if they held similar referenda. The UK referendum result is mainly a responsibility for UK politicians, but obviously EU leaders and all of us working in promotion of the positive European development have a fair share of responsibility of not being able to show the EU for what it is – a necessity for our continent.

    Secondly, even with a strong desire from both the UK and EU sides to have as smooth negotiations as possible, the negotiations will not be easy. The two year timetable set for the completion of an exit is extremely short by any standards. Both in the EU and the UK only general emergency plans were made in case of Brexit, but detailed plans are yet to emerge.

    In other words, the challenge today is that we don’t even know all the challenges. 27 member states promoting their individual set of interests and the UK trying to guarantee the best possible deal while undoing 42 years of institutional cooperation will be a painful experience for everybody, even without additional hostility from the EU side.

    As a third point of consideration, despite the UK referendum result, the UK is an essential part of the western world and will stay that way. We should not forget that 48.1 % of the UK voters voted in favour of staying in the EU, despite the brutal campaign of misinformation and, at times, plain lies. Reading the text of UK citizens in social media and the articles and op-eds of journalists one understands that very large proportion of UK citizens are not only disappointed or sad, but heartbroken by the direction their country has taken.


    “Already before the referendum there was a school of thought within the EU that if Brexit happened, the separation should be as painful as possible in able to make sure that no other member states would follow suit.”


    Young people in the UK reacted to the referendum results with deep disappointment. Among citizens 50 years old and under, the Remain option had clear overwhelming support and among 18-24 years old 75%  of voters were in support of staying in the EU. The generational divide is evident. Should the UK referendum have taken place ten years later, the Remain side could have had a clear victory.

    A very large part of UK sees the importance of European unity, globalisation and openness. That part of the population is an important part of the future make-up of Europe, even if for a couple of years the relation between the UK and the EU will be reflected by this referendum result.

    The UK voters have decided the course of their country and we will respect the results. In consequence, we will conduct the exit negotiations with the UK aiming for the most advantageous result for the EU and its 27 member states. In this negotiation, the UK will be considered as an external 3rd country.

    However, when those negotiations are over, our goal needs to be to enhance and strengthen the relations with the UK as much as we can, because the values UK holds dear are still the same as those of the 27 member states. We should not discard decades of friendship and trust just because of one unfortunate referendum. 

    Tomi Huhtanen Brexit EU Member States European Union Leadership Trade

    Tomi Huhtanen

    Brexit: Revenge on the British will not help Europe

    Blog

    27 Jun 2016

  • This will look like the wrong moment to say anything positive. And indeed, yesterday was a sad day for Europe. In our eyes, and those of its own young, Cool Britannia has turned into Little England. 24 June, 2016, will be economically painful for all sides concerned, it throws British politics into turmoil, even endangers the coherence of the United Kingdom, emboldens nationalists across the continent, weakens the West and makes Putin a happy man. And yet, while panic will only make matters worse, some aspects of Britain’s momentous decision are more disastrous than others. Starting with the economy, Britain will go through a rough period of a much weaker Pound, and investors withdrawing or at least thinking twice before putting their money into Britain. In the Brexit negotiations, Britain will try to preserve as much free trade as possible while not having to adapt to all the regulation it now cannot influence anymore. So the job for the EU’s negotiators will be to not ‘punish’ Britain (and shoot ourselves in the foot by inhibiting trade) while still preventing the impression that countries can get away with leaving and then retaining better deals than member states. Both large UK parties have been damaged because their leaderships argued for remain while the majority of their voters opted for leave. Expect turbulence in British domestic politics for some time to come. And although a second Scottish referendum will not follow as automatically as Scottish nationalists like to pretend (Parliament has to approve), both the Scottish and the Irish questions will return with a vengeance. But one of the most appalling aspects is that the anti-EU vote was also an anti-establishment, anti-market, anti-globalisation and anti-politics vote. The Leave propaganda was a far cry from good old Thatcherite Euroscepticism. In a way, England has moved from ‘I want my money back!’ to ‘I want my country back!’ –when no one from Brussels was actually trying to steal it. In fact, as reliable analyses are showing, Leave was mainly about ‘independence’ and ‘immigration’ – i.e. freeing Britain from Brussels-imposed slavery and migrants. Moreover, the Leave campaign’s allegations about a pro-remain conspiracy of the rich against the ‘little people’ were quite telling. But that tendency reflects a global trend that will only subside when its proponents are confronted with the harsh choices of actually governing. Britain over the coming months and years may become an excellent – and deterrent – example. In the remaining 27 member states, populist and nationalist parties are already calling for exit referenda. Even if leave majorities may be harder to achieve there, populists will use the polarisation in order to promote their parties and movements. But all that should not distract us from the most important task for the near future: Demonstrate that ‘more Europe’ in every field is a thing of the past. A stronger Union in foreign and domestic security will, of course, be necessary. But the governments of the Founding Six can meet for another 10 dinners, and I still don’t see ‘Core Europe’emerging if it presupposes a European finance minister (only over France’s dead body) or a transfer union (which no German party except the Greens will want to defend in their own country). So let’s get serious about making the Single Market more performant and less regulated, for example through more mutual recognition instead of unlimited harmonisation. Let’s handle Schengen flexibly in the face of jihadist terrorism. And let’s increase NATO-EU cooperation so that the laughter fromthe Kremlin is a bit less raucous. These are hard times for European integration. But if nothing else, what we should keep after Britain leaves, is a stiff upper lip.

    Roland Freudenstein EU Institutions EU Member States European Union

    Roland Freudenstein

    Keep calm and work for a better Europe

    Blog

    25 Jun 2016

  • I don’t need to quote Bill Clinton to impress the importance of economic issues within the wider EU referendum debate. A recent YouGov poll that examined motivation for voting one way or the other showed the economy at the top of the tree in terms of broad policy (albeit behind the idea of the “right to act independently, and the appropriate level of cooperation with other countries”) a finding frankly unsurprising given the level of messaging on the subject by the mainstream media, both campaigns and an alphabet soup of official bodies over the last few weeks.

    Twenty-three per cent of voters polled by YouGov cited the topic as more important than any other and the online conversation has long been dominated by finance and business- related opinions. The extent of this domination however, is on the wane, as social media users increasingly find the broad subject of immigration more discussion-worthy.

    Figure 1

    Motivation to vote topics

    Immigration, and the distinctive yet linked by many in the debate, discussion of refugees and asylum has risen in prominence since the beginning of June, to become the second most discussed motivation category within the online debate, perhaps prompted by at least two events in the last week: one hugely controversial, one tragic. Figure 1 shows the movement across these motivation areas from May to June.

    Figure 2

    Economy and Immigration as a % of all EU Referendum discussion

    Figure 2 shows how these motivation areas have tracked since the beginning of May. Lines showing trends for discussion around the economy and immigration, in relation to the wider debate on the EU referendum, clearly converge. We have not reached a tipping point in terms of prominence and it might be interesting to speculate on how long the campaign we need to run before the lines would cross, but we are certainly approaching parity.

    The reasons for this are varied. As noted, social media debate does not exist in a vacuum and mainstream media and offline events have certainly helped to nudge immigration to the fore, but this trend existed before last week’s UKIP “Breaking Point” billboard and the murder of MP Jo Cox. It may be that, as both campaigns have upped the ante in the last few weeks and the debate has grown more poisonous, issues that were once the preserve of political extremes have become normalised.

    We could look further at the proportion of owned content posted by each official campaign account on the subject of the economy and immigration. To what extent has the nudge become a shove? Has the dog whistle become a foghorn?

    We can understand a lot more about the nature of the debate by graphing the conversation. As outlined in my previous piece on Brexit, pro-Leave campaigners have consistently generated the majority of the noise on referendum-related subjects, with this changing little since the end of March when I first measured the subject.

    Figure 3

    figure3

    The first blog on the referendum showed the networked conversation in March and at the beginning of May: a vociferous, messy exchange, largely controlled by Brexiteers.

    Figures 3 and 4 outline the networks if we isolate economic discussion within the referendum (3) and that about immigration (4). The differences are far from obvious, but we can see a marginally different shape to the maps. Discussion on the economy (3) is more fractured: the bulb to the right predominantly consists of pro-Leave tweeters, while the strands to the left largely pro-Remain, and there are few links (conversations) between them.

    When we look more closely at the immigration map (4) we see three areas: a Leave bulb to the right, a loose cluster of Remain campaigners to the left and the Stronger In (@strongerin) neighbourhood in the centre. This, along with the tightness of the Leave community to the right shows both that this is a more combative area of the debate, given the closer links, and that the Leave side is possibly more “unified’ (or perhaps more insular) given the concentration of the community to the right.

    Figure 4

    Immigration conversation

    Further points of interest come in understanding who is is more conspicuous with each neighbourhood. For example, the former Director of Strategy to the Prime Minister, Steve Hilton (@stevehiltonx) is prominent and central to the debate on the economy, but peripheral amid discourse on immigration, and vice versa for UKIP MP Douglas Carswell (@DouglasCarswell). Louise Mensch is central within both: the most influential contributor to the debate on immigration, according to this methodology, and the fourth-most on economic issues.

    Further top-level analysis shows where the graph of the debate deviates from what we might expect. Dan Hannan MEP (@DanHannanMEP) for example, is found on the ‘wrong’ side of the immigration map. Algorithmically, at least, Hannan is closer to Chuka Umunna (@ChukkaUmunna) and The Independent (@independent), despite being a high profile and long-standing Eurosceptic and prominent pro-Leaver, due to his conversational connections with other influential parties in the debate. Hannan is graphed centrally on economic issues; however, closer to grassroots campaigners, deeply inside the cluster with Vote Leave (@vote_leave) at its centre.

    Whilst this light scrutiny barely scratches the surface of this online dialogue, we clearly see that there is not one debate, but many pieces, clusters and neighbourhoods, dictated by topics that provide motivation to vote, influential social media users or concentrations of grassroots campaigners. Beyond this blog, we might understand micro-discussions at a local level, around TV debates, political parties or other organisations. In short, there are ways to quickly unravel this mess and isolate the areas of the discussion that best match certain messaging or targeted campaign strategy.

    The relative importance of the economy or immigration to the referendum result will quickly become apparent next week, after pollsters have picked through exit polls and dissected motivation. What’s sure at this stage is that control of these conversations will go a long way to determining the outcome and, whilst online conversation is clearly not representative of the sentiment of the electorate at large, it might persuade the many undecided voters that seek guidance on polling day.

    On a more personal note, any optimism I once held that the referendum could precipitate a healthy debate on Britain’s relationship with the EU, its future as an outward-looking country and its role in the wider world has long disintegrated, and the hegemony of economic and immigration-related fear in this analysis goes a long way to explaining why.

    * A full explanation of the network maps is available here.

    This blogpost is the first from an Ogilvy London series analysing the online EU referendum debate from a variety of angles in the weeks before the vote on June 23. You can read the original blogpost here

    Gareth Ham Economy Elections EU Member States Immigration

    Gareth Ham

    Economy or immigration: which one tops the EU referendum debate?

    Blog

    23 Jun 2016

  • A recent Guardian ICM opinion poll showed a fascinating difference between the views of participants in phone and online surveys regarding the upcoming EU referendum. Both were relatively divisive, only on different sides of the debate: those polled over the phone were eight percentage points more likely to vote to remain the in EU (47 to 39) whilst voters that contributed to the online poll were four points more likely to leave (47:43).

    A range of reasons for this split could exist, but it is a scenario that those of us close to online political campaigning have long foreseen.

    For anybody visiting social media platforms to analyse or involve themselves in the debate on Scottish independence, for example, the online reality provided a vastly different message to the one given by traditional polling: strongly in favour of leaving (or dissolving, depending on your point of view) the United Kingdom – a study I ran in August 2014 attributed approximately 90% of all public social media mentions of the referendum to supporters of independence.

    Analysis of the online debate on the EU referendum reveals a similar, yet more dramatic pattern to that underscored by the Guardian ICM poll.

    The visual in Figure 1 shows the structure of the referendum debate on UK Twitter during the second week of May. The network graph shows the inter-connectivity of the 1000 most influential tweeters in the United Kingdom that discussed the referendum in a variety of ways in the week commencing May 9 (hashtags, responding to campaign accounts, longer form mentions of the referendum or simply expressing views to leave or remain).

    Each node (dot) is a Twitter account and each edge (line) is a connection between them. Connections are conversational, rather than a simple look at who follows or @mentions whom, so show retweets, responses and quoted statuses. A full description of the network map is available here.

    Figure 1

    Figure 1

    The bulb-shaped cluster to the right of the map is almost exclusively made up of Twitter users strongly in favour of leaving the EU, whilst the strands to the left are largely accounts supportive of Remain. We can also quickly see that the Leave side of the network is both multi-faceted and tightly clustered: the multiple colours show that several sub-networks exist within this conversation, whilst the high density graph shows that the accounts are highly likely to engage directly with one another.

    The largest, most central node on the leave side (red, with thick links to other accounts) is Vote Leave (@vote_leave), perhaps to be expected, whilst the large node to the left of Vote Leave is campaigner Dr Rachel Joyce (@racheljoyce). The latter has only 3,638 followers (at the time of writing) but is crucial to the integrity of this specific conversational network, bringing otherwise disparate accounts together in the debate.

    The strands to the left are held together by two large nodes: Stronger In (@StrongerIn, top) and “British and European” (@polnyypesets, bottom). As on the Leave side, @polnyypesets is not an obvious agent of this debate with just 2,857 followers, but is central to networked discussion.

    Interestingly, the structure of this Twitter debate has changed little since we ran the same analysis a few weeks previously. Figure 2 shows the network graph of the referendum debate at the end of March.

    Figure 2

    Figure 2

    The shape is the same: largely pro-Brexit accounts dominating the online noise, whilst Remain supporters inhabit the fringes. Twitter accounts on both sides however, are linked in places, occasionally by media or polling accounts but more often by tweeters engaging in active debate.

    A key reason for the centrality of @polnyypesets in the network is that the account converses with both sides, providing a bridge between Remain and Leave (albeit having closer links to Remain, hence its location in the network).

    When we compare the EU referendum map to the factional, scattered network map of the European political parties (EPP, PES, ALDE etc) during the 2014 Spitzenkandidat race within the European Parliament election (figure 3) we see far higher levels of bipartisan discussion.

    In figure 3, each cluster is dominated by official campaign messaging by the European parties, with few connections between rival camps.

    Figure 3

    Figure 3

    The crucial difference between figures 1 and 2 involves the maps’ density. Edges linking Twitter accounts are thinner, meaning fewer interactions between these people, whilst clustering of the map in general is less dense, meaning that fewer of these accounts were conversing with others in March. Bluntly, the online conversation has stepped up, accounts in the EU referendum debate have become more active and conversations between influencers more common.

    Figure 4

    Figure 4 below shows the volume of public social media mentions per week in the UK about the referendum, and the number of unique authors in the discussion (source: Brandwatch). Contributors on both sides are posting more frequently.

    Figure 4

    Reasons for the domination of the online debate by Leave advocates can be discussed at length. We may point to a more disparate coalition of groups of the pro-Brexit side in addition to the official Vote Leave campaign, or to an anti-establishment, anti-status quo sentiment of online discussion more broadly.

    And whilst this cannot be considered in the same vein as traditional polling as an indicator of the eventual result, its importance should not be underestimated. For the undecided voter that turns to online platforms for guidance or verification of whatever facts exist on either side, this is what they will encounter.

    Similarly, the noisy, crowded nature of this discussion highlights the importance of careful navigation and accurate targeting of the right content, to the right voters and the right times, particularly for those encouraging Remain and the official Stronger In campaign.

    Whilst the overall structure of the campaign shouldn’t necessarily be of concern to Stronger In, it further highlights that directing messages demographically or geographically is no longer adequate or necessary, and that it is possible to cut through the noise by engaging a relatively small set of influencers.

    With less than a month until the vote, understanding the changing nature of this debate structure is crucial to both sides.

    With the issue of Turkish accession to the EU entering the campaign in earnest last weekend, and with Sadiq Khan and City Hall diving into the campaign to actively promote Remain in the following days, network graphs provide an excellent way of understanding the impact and prevalence of such messaging, and which accounts are influential within this morass. This series aims to understand some of those facets over the upcoming weeks.

    This blogpost is the first from an Ogilvy London series analysing the online EU referendum debate from a variety of angles in the weeks before the vote on June 23. You can read the original blogpost here

    Gareth Ham Elections EU Member States European Union Internet

    Gareth Ham

    The online debate around the EU referendum: should Remainers be concerned?

    Blog

    13 Jun 2016

  • 25 years after the foundation of the Visegrad Group is a good time to evaluate its role and to take a look at its current functioning within the EU. A historic goal of the group was already fulfilled, as all four states; Czech Republic, Hungary, Poland and Slovakia are now members of the EU and NATO.

    The Visegrad Group played an important role in 1998 when it strongly supported Slovakia, which was internationally isolated after the government of Vladimír Mečiar. Slovaks could thus catch up with the integration process. Later, they showed their will to grow in a regional context, but also to be credible, even if sometimes also difficult partners within the EU (particularly in the negotiations on the EU budget, or in pursuit of national interests).

    The Visegrad Group did not focus only on their interests, but also responsibly took on a regional role. Its support focused on the Western Balkans and the Eastern Partnership countries. European integration of those countries is a long-term priority on the Visegrad group agenda. It is no secret that Slovenia has tried for a long time to become a member of this regional club. This only demonstrates the weight and prestige of the club.

    Regional partnerships have a very strong tradition in Europe. Whether Benelux, Nordic cooperation or the Visegrad Group, all of them serve to strengthen the EU further. They create a balance especially between small and big countries. Every community needs such healthy tension, because it forces players to make compromises and seek the best possible solutions for the whole community.

    Unfortunately, any positive result of the Visegrad Group´s cooperation is currently overshadowed by its attitude to the migration crisis. The policy endorsed by the Visegard Group on the issue rightfully raises a concern. This attitude neither solves the problem, nor does it defend the countries and their citizens, as leaders of these countries like to present.

    The refugee crisis and its impact are not a short-term phenomenon. The problem will not be solved, on the contrary, it will deepen if they are not willing to listen to each other and patiently seek for a common solution from the very beginning. The consequences can be fatal for the entire community.

    The attitude of the Visegrad Group portrays them as fair-weather Europeans. They do not yet have the tools to deal with bad weather. Unfortunately, this is the reality, although the reasons of this attitude can be different, from historical to mental or political.

    Historically, it is well known that ethnicity was often a source of unrests in Central Europe. From a psychological point of view, the former Soviet bloc countries are still closed societies. There is a lack of education and a lack of system methods on how to integrate people from other cultures. We should not forget that these countries still have a huge problem with the integration of their Roma minority.

    Thus, it is difficult to imagine and even more difficult to implement the integration of people from completely different backgrounds. However, the most likely reason for this attitude is politics.

    The leaders of these countries selfishly abused the refugee crisis in order to gain political capital. Many of them have built their whole electoral campaigns and long term strategies with a sole purpose: to remain on the political scene for as long as possible. They do not struggle with the fact that, more than 25 years after the fall of communism, they have created a new enemy and they have showed their resistance to Brussels, in a manner that certainly pleases Russia.

    Regarding the quotas, there has already been a lot said. The Visegrad group countries, but also others who refused the quotas system should realise the fact that it is a temporary redistribution of burden, not a long term solution for migration.

    The proposed redistribution is very favourable for small countries. If they show a will to share the burden now, they will help create a space for a more conceptual, long-term solution for migration. Unfortunately, the quotas themselves put us into a vicious circle.

    Instead of focusing on protecting the EU external borders and seeking solutions how to prevent further immigration waves into Europe, we have focused on how to punish those who will not accept the quotas. I believe the latest proposal of the European Commission in this regard will increase the gap among EU countries.

    We all know we have a problem. The question is, where should we start tackling it from? Firstly, we should respond to three basic questions: Do we want to remain in the European club? What kind of club do we want? Are we willing to invest in this club? If so, it’s time for a compromise.

    The older members should listen more and try to understand the arguments of the new member states. I know that reconciling the heterogeneous interests of a large community is difficult, but this is the only way to keep the EU project alive. It is also important to show political will and initiative on the part of small and new members.

    Slovakia taking over the rotating Presidency of the EU this July is a good timing to do just this. They have an excellent opportunity to come up with solutions on migration issues and to build wide EU support for them. Denouncing and rejecting proposals is not a sustainable strategy: we must show that we are not only recipients of EU policies, but also initiators and contributors.

    Former Soviet bloc countries should inherently insist on maintaining a common European future. Regional cooperation is good and necessary; it can be meaningful and beneficial but only when its enforcement is not only regional, but also European. We should not forget that countries like France and Germany will cope with crises more rapidly than the rest of Europe. Small states near Russia however could quickly find themselves back to where they once were. I do hope that this will not be the case.

    Viktória Jančošeková EU Member States Immigration Leadership Migration

    Viktória Jančošeková

    Visegrad at 25: time to show European leadership

    Blog

    08 Jun 2016

  • Ex-post investigations of major terrorist attacks in Europe have highlighted the contradiction between the seemingly free movement of terrorists across Europe and the lack of EU-wide intelligence sharing.

    In response, EU policymakers have repeatedly promised to improve intelligence sharing across Europe, and some have even floated the idea that Europol should be turned into a centralised EU criminal intelligence hub, akin to the US Federal Bureau of Investigation.

    In this article, I argue that despite the clear need for borderless intelligence sharing as a response to borderless terrorism, Europol is highly unlikely to become a genuine intelligence agency in the foreseeable future.

    Experience to date with Europol suggests that it is one thing for Europe’s policymakers to make public promises to improve the fight against terrorism via better intelligence sharing across Europe, and quite another thing for them to persuade the relevant national agencies to comply.

    Read the full articlein the June 2016 issue of the European View, the Martens Centre policy journal.

    Oldrich Bureš EU Institutions EU Member States Security

    Oldrich Bureš

    Intelligence sharing and the fight against terrorism in the EU: lessons learned from Europol

    Blog

    12 May 2016

  • The terrorist attacks in Brussels on the second day of spring 2016 have inspired renewed calls for better sharing of intelligence between the EU’s national governments. For example, Guy Verhofstadt, the chairman of the liberal (ALDE) group in the European Parliament, called on 25 March on the European Commission to propose legislation to make mandatory the exchange of counter terrorism intelligence between all 28 national services. The Commissioner for Migration, Dimitris Avramopoulos, also called for the establishment of a European Intelligence Agency.

    So, is a new agency needed? In my opinion, there are good reasons for caution.

    According to the Lisbon Treaty, the member states are in charge of intelligence agencies.  But intelligence gathering and sharing, the traditional preserve of nation states, obviously needs to be concentrated on the continental scale. This is in order for the European continent to face up to the increasing threat from Islamic (as well as right-wing) terrorists.

    The problems in the way we Europeans currently operate our ‘secret services’ are numerous.

    • Some knowledge about attackers in the Charlie Hebdo (January 2015), Paris (November 2015) and Brussels (March 2016) cases existed in Europe and Turkey. This knowledge did not reach the right authorities at the right time. According to the Czech interior minister Milan Chovanec, until recently only five or six countries fully shared information in the framework of Europol, the EU police agency. 
    • A small common intelligence agency, the EU Intelligence Analysis Centre (EU INTCEN), has existed since 2002 (originally under a different name). This body relies on publicly available information, information from EU embassies as well as information delivered by the member states. (It then passes analyses on to the EU Counter-Terrorism Coordinator and the Political and Security Committee of the EU). The member states set the rules for data protection. EU INTCEN does not receive operational intelligence.
    • A prominent EU member, the UK, is part of an intelligence alliance, calledthe Five Eyes. Comprising also the US, Canada, Australia and New Zealand, no other EU country has been allowed into this powerful club.
    • National intelligence agencies are not working sufficiently with one another, within countries. For example in Czechia, the rivalry between the several agencies, each controlled by a different government minister, is notorious. 
    • Many EU members do not spend enough on intelligence, a trend exacerbated by the recent economic crisis and the efforts to balance national budgets.

    If there are all these problems, why not create a European intelligence agency, which would demand a mandatory exchange of information between the member states?

    Suggesting the creation of a new agency is easy; explaining how it will work under the current circumstances is another matter. In my opinion those who call for a new agency got the wrong end of the stick.

    There are two main problems with setting up a European intelligence body with its own capacity to gather information.

    • Firstly, EU-level bodies are notoriously ‘leaky’ when it comes to classified and secret information. Although hard evidence is hard to come by, these bodies are probably penetrated by non-European intelligence services. These services do not necessarily belong to friendly countries.
    • Secondly, it is not clear which body would supervise such a new agency. The European Parliament has yet to establish a sufficient record in relation to such a delicate task.

    So before the issues of trust, security of information and democratic oversight are resolved, it is hard to see how a new EU-level agency would help.

    Let us therefore work much better with the tools we already have, including pragmatic cooperation with a key partner, Turkey. The European Parliament and Commission should exert a stronger pressure on national governments to implement the existing anti-terrorist legislation and fulfil their legal obligations.There are 88 binding anti-terror laws in place at the EU level.

    For example, the member states need to feed databases, such as the Schengen Information System, with substantive criminal intelligence information. They need to step their cooperation within Europol.  Europol and Frontex, the EU’s border control agency, should also be allowed to share information. There are many such measures which can be achieved with the existing agencies and laws.

    One piece of new legislation that is sorely needed is the Passenger Name Record legislation which would allow gathering and storing travellers’ data.

    The goal in all this is to increase the speed of information exchange and making sure information comes to the right authorities at the right time.

    Only when we have exhausted these options, let us start contemplating a new EU-level intelligence agency.

    Vít Novotný EU Member States Security

    Vít Novotný

    A European Intelligence Agency: The Cons Outweigh the Pros

    Blog

    06 Apr 2016

  • In 2015 the Wilfried Martens Centre for European Studies once again showed itself to be a mature organisation with an established position on the European think tank scene.

    Centre-Right EU Member States EU-US

    Activity Report 2015

    Activity Report

    01 Mar 2016

  • The possibility of a Dail being elected tomorrow where no feasible combination of parties will be able to form a government is unfortunately quite high. Party leaders were incessantly pressed by the media and others during the campaign into ruling out coalition options.

    There was no space allowed for “constructive ambiguity”, although Irish people know well that, without “constructive ambiguity” in the short term, we might have had no peace process in the long term. Media interest and public interest are not always identical. 

    The questions asked by moderators in the leaders’ debates seemed to focus heavily on catching leaders out about things they said or did in the past rather than on their thoughts about the future, which is what is really important now. Some of the issues pursued were trivial, like the appointment of a member to the board of an art gallery. 

    It is almost as if the moderators wanted to ask questions about the past because they were themselves uncomfortable dealing with challenges about the future, like: 

    • the ballooning cost of health services, relative to resources available
    • the looming  pensions crisis, where  numbers at work will decline relative to numbers on pension
    • the changes required of Ireland to meet  its climate change obligations
    • what the leaders would do, next June,  if the UK leaves the EU
    • the shape of the 2017 budget ( all the focus was on what might be possible in 2021!)
    • what the leaders would do if, when the Dail meets, no combination of parties, willing to coalesce with one another, could attain a majority
    • how long could we go without a government, if one is not elected on 10 March

    These are not very original questions, but they are the ones voters should be thinking about.

    John Bruton Elections EU Member States Leadership

    John Bruton

    Eve of Irish election prognosis

    Blog

    25 Feb 2016

  • Unsurprisingly even within the “Brussels bubble” economists cannot agree on the ultimate result of President Juncker’s European Fund for Strategic Investments (Juncker Plan). The mobilisation of additional funding mechanisms – over and above agreed national and EU frameworks – has caused unease with those who have prioritised budgetary consolidation as an immediate policy imperative.

    In this debate Germany holds the most important role as Europe’s strongest large economy in 2016. However, this note highlights that fiscal balance and increased investment are not mutually exclusive political actions, but rather form important elements of a sustainable economic policy framework. This is vitally important for all member states, but particularly for Germany, in light of its challenging long term economic outlook.

    Economy EU Member States Eurozone Growth

    Germany and the Juncker Plan: 3 Steps to Reconcile Fiscal Consolidation and Investment

    IN FOCUS

    16 Feb 2016

  • The concessions the UK is winning to encourage its citizens to vote to stay in the EU could make the EU even more complicated than it is. They could slow down decision making still further, at the very time when problems are becoming more, not less urgent. This would not be “Reform”. Yet David Cameron says he wants the keep the UK in what he calls a “reformed European Union”. 

    Already the UK is exempt from joining the euro, exempt from the common border rules of Schengen and does not have to take part in EU activities to combat crime (although it can opt into these on a pick and mix basis). It is a semi-detached member of the EU, which makes it harder for the UK to exercise leadership in the EU.

    Now the UK is seeking, and may be granted at a Summit next Thursday, new concessions. These concessions are being sought because UK public opinion is convinced that the EU is undemocratic and should be curbed. They are convinced the only locus of true democracy for the UK is Westminster. 

    The truth is that neither the EU, nor Westminster are a perfect expression of democracy. In Westminster a party can have an overall majority of the seats with only 37% of the vote. In the EU, while the members of the European Parliament and the Council of Ministers each have democratic mandates, the people of Europe have only a very indirect vote on who is to be the President of the European Commission. EU voters, unlike Westminster voters, do not have a sense that they can throw the EU government out of office.

    But, instead of focussing on how to make the EU level governance more democratic, UK negotiators have concentrated on enhancing the capacity of the 28 national parliaments to block EU law making. Given that the UK is a global player, one would have expected it instead to focus on making global and EU wide governance more democratic, rather than slowing things down or simply repatriating powers to the national level.

    NEW OBSTACLES TO EU LAWMAKING DO NOT EQUAL “REFORM”

    As part of the package devised to respond to UK requests, EU rules are to be changed to allow 55% of national parliaments to apply to have an EU law blocked before it has been properly considered by the Council of Ministers and the European Parliament.  This “Red Card” power is to be exercised within 12 weeks of the law having been presented at EU level. This blockage is supposed to be grounded on a claim that the EU law breaches to principle of “subsidiarity”.

    Subsidiarity is a philosophical concept around which there can be so many differences of opinion, that it does not constrain this blocking mechanism being used for reasons of pure political opportunism. One could easily envisage an EU law that had been introduced to open up the EU market for legal services being opposed virulently by lawyers in every member state. Or one could imagine an EU law to open up the energy market across borders being opposed by high cost producers in a number of states.

    As it is, the lawyers and the energy companies can, and do, already fight such laws in the European Commission before they are presented, and then in the Council of Ministers and the European Parliament while they are being debated, voted upon, and compromised in and between Parliament and Council. Now, to allay UK worries, a new field of operation is being opened up for the lobbyists who want to stop an EU law: the 28 national parliaments of the EU.

    EU lobbyists will now be tempted to open offices in the capitals of all member states, so that they can be ready to lobby on behalf of clients to persuade members of national parliaments to use of the Red Card to stop a future EU law a client might not like.

    Parliamentary majorities can change and many EU countries are governed by coalitions or minority governments, so one could envisage EU lobbyists seeking to exploit domestic inter party rivalries, or domestic instability, to win support for the use of a Red Card by a national parliament.

    All national parliaments are equal in this system, so the 55% blocking vote could come from countries that represent only a small minority of the EU population. It is therefore surprising that the UK, which is a big country, is championing this mechanism. 

    It is also surprising for another reason. The UK is primarily an exporter of services rather than goods.  It is in the area of services, rather than goods, that the EU Single market is furthest from completion. Therefore, services is an area where the EU will need to pass the most laws to sweep aside national restrictions on competition from other EU states. 

    As a services exporter, the UK would have much more to gain than to lose from the EU Services liberalisation legislation. Yet it is the UK which is seeking a red card that would make it easier for opponents of liberalisation to delay and block EU liberalisation legislation!

    PREVENTING THE EURO ZONE TO ACT QUICKLY IN A CRISIS DOES NOT CONSTITUTE “REFORM”

    Another proposed concession to the UK could also complicate EU decision making on economic and financial matters. Here the UK concern is about rules being made to govern the euro, which might inhibit UK financial operators making full use of the euro zone market.

    On the other hand, as we have learned from the crisis, banking problems in one jurisdiction infect others very easily. UK and US banks were exposed by the Greek crisis and did not complain when EU action protected their interests!

    The EU authorities may have to act very quickly if there is a new banking crisis. The EU banking union is not complete, especially as far as deposit insurance is concerned. Yet to satisfy the UK, it is now  proposed that a member state, like the UK, that is not in the euro zone, be free to appeal a proposed EU law, which is proposed to safeguard the euro, to the European Council (where it may be able to veto it).

    This is despite the fact that it is also proposed, in the special package for the UK, that non euro members are to be freed of any financial obligation for euro area costs and that in non-euro zone countries, supervision of banks be a “matter for their own authorities” according to the text.

    The proposed procedure would allow a non-euro member, like the UK, to delay an EU law that is needed, in the view of the states that are in the euro, to safeguard their currency or to ensure the solvency and proper supervision of their banks, in the interests of customers and depositors.

     It is unclear what happens when the appeal is brought to the European Council. The European Council usually decides issues by unanimity, so one could envisage an urgent EU law to safeguard the euro or the euro zone economy being vetoed there by the UK, which was not even in the euro. This is giving the UK power without responsibility.

    The proposal for the UK does say that “member states whose currency is not the euro shall not impede the implementation of legal acts linked to the functioning of the euro area and shall refrain from measures which could jeopardise the attainment of the objectives of the economic and monetary union”. But these are all matters of judgement on which it may not be easy to find unanimity, especially when time is short, and national interests collide.

    BRITAIN SHOULD RAISE ITS SIGHTS

    For the past two millennia, Britain has had a vital interest in the peace and prosperity of continental Europe. It has gone to war many times to preserve it. English is the language of EU governance. The EU Single Market is a modern application of the ideas of Adam Smith.

    Two hundred years ago, when European states were much less interdependent than today and were recovering from the Napoleonic Wars, the then UK Foreign Secretary, Lord Castlereagh, persuaded the European powers to make, in his words, “a systematic pledge of preserving concert among the leading powers and a refuge under which all minor states may look to find their security”. While his views on Ireland were mistaken, Castlereagh’s views on Europe were not.

    Rather than seeking a series of further exemptions and so called “reforms” that will slow even further an already complex EU lawmaking system, David Cameron should follow Castlereagh’s example and set out his country’s own comprehensive vision for the peace and prosperity of Europe.

    Then he might give himself a chance of winning the Referendum he has chosen to have. 

    John Bruton EU Member States European Union Leadership

    John Bruton

    David Cameron and the courage of real reform

    Blog

    15 Feb 2016

  • Next June the people of the UK may vote to leave the European Union. At the moment, a narrow majority favours remaining in the EU, but a large group are undecided. That group could swing towards a “leave” position for a variety of reasons, including what might be temporary EU problems with refugees. However temporary the reasons might be, a decision to leave, once made, would be politically irreversible.

    So it would be wise for Ireland to give thought now to how it might react to a decision by UK voters to leave the EU, and how it would play its hand in the subsequent negotiations. A number of scenarios will arise and Ireland needs to identify its red lines in each one of these.

    THE NEGOTIATIONS COULD ONLY TAKE 21 MONTHS

    The negotiation of a UK withdrawal from the EU will be done under Article 50 of the Lisbon Treaty. It will have to be a quick negotiation because Article 50 contains a two year time limit. In practice the negotiation of withdrawal arrangements will all have to be finished in about 21 months.

    From the date that the UK Prime Minister informs the European Council of his/her decision to implement the referendum decision, the two year time limit starts to run. Assuming a June 2016 Referendum, I calculate the Withdrawal Treaty would have to been negotiated, ratified, and brought into force by July 2018.

    So the negotiations themselves between the EU side and the UK side would probably have to be finished at latest by April 2018, to allow time for parliamentary ratifications. In the event that no agreement had been reached within the deadline, the EU Treaties “would cease to apply” to the UK. The UK would simply be out of the EU, without even a trade agreement.

    This would be exceptionally disruptive of the UK economy, and of some, but not all, EU states’ economies. It would be particularly bad for Ireland. Our exports to the UK would be at risk, and the border would be deepened with incalculable consequences.

    UNANIMITY OF ALL EU STATES NEEDED TO EXTEND THE TWO YEAR LIMIT

    The two year limit could be extended, but only with the consent of all 27 members of the EU. If the negotiations had become contentious, or if the UK demands bore heavily against the interests of one or two states, one could see the required unanimous consent for an extension of negotiating time being withheld.

    This risk of a single refusal to extend time for negotiation, adversely affects the dynamics of the negotiation, from a UK point of view, because the UK has more to lose from failure. It is not inconceivable that a populist government in a member state might hold a time extension for the UK hostage to obtain some other unrelated matter, such as debt relief.  A European Parliament in election year could also be a source of uncertainty.

    While a time extension would require unanimity, the actual negotiation of the terms of withdrawal would need a “Qualified Majority” within the European Council.

    NO GUARANTEE OF PROTECTION OF IRISH INTERESTS IN WITHDRAWAL TREATY

    That means that the terms of the Withdrawal Treaty would need to support of 72% of the 27 EU governments, collectively representing at least 65% of the total EU population. Ireland, on its own, could not block a Withdrawal Treaty that contained terms that were against Irish interests. Nor could Ireland guarantee it would be agreed on terms that would adequately protect Ireland’s interests. For example, Ireland could not necessarily prevent passport controls or customs posts on the border in Ireland.

    While 72% of  EU member state governments must agree to the Treaty terms, 100% of the 27 national parliaments must do so, and ratification could become entangled in General Elections  in some states in the interim. While our fellow EU member states will undoubtedly recognise the Ireland will suffer more than any other EU state from a UK withdrawal, which does not guarantee that Irish interests will be taken into account in all cases. Quid pro Quo will apply, and that could cause difficulties on vital Irish interests on EU issues that have little direct bearing on the UK Withdrawal as such.

    Given the short time involved, the UK will not have the option of pursuing a relaxed post referendum exploration of different types of external association with the EU. It will probably have to decide at the outset what form of relationship it is seeking. It will have to choose among options that do not require the EU itself to change its Treaties. The options were well described in a recent paper by Jean Claude Piris, former legal advisor to the European Council.

    SCENARIO 1: UK JOINS THE EUROPEAN ECONOMIC AREA

    The simplest would be to join the European Economic Area (EEA), while leaving the EU itself. The EEA allows Iceland, Liechtenstein and Norway to take part in the EU Single Market, but without being in the EU Agricultural, Fisheries, Judicial and Foreign Policies.

    In the EEA, the UK would still have to contribute to the EU budget, to apply EU Single Market rules without having the say it now has in them, and to allow free movement of EU migrants to work in the UK on the same terms as locals.

    Ireland’s problem with this option would be the departure of the UK from the EU Common Agricultural Policy which would raise issues of fair competitive access for Irish farm produce to the UK market. Management of Atlantic Fisheries would also become more contentious.

    SCENARIO 2: THE SWISS APPROACH

    Less simple would be for the UK to seek to make tailor made agreements with the EU, like Switzerland has. This negotiation would be a very complex process where tradeoffs would have to be sought between different sectors and national interests. The Swiss model has not worked well from an EU point of view, and one could expect EU negotiators to take an exceptionally tough line if this is what the UK seeks. The issue of access to the UK labour market for EU citizens would certainly be a demand from the EU side in such a negotiation.

    In practice, if not in theory, the UK would have to implement EU law in all the areas for which it sought access to the EU market. This would be very problematic from the point of view of the financial services exports from London to Europe. 

    Once such a deal had been concluded, the EU side would be under pressure to tilt its own internal rules to favour financial service providers in the EU itself. If a system of mutual support and mutual supervision of financial service providers existed within the EU, and the UK was not part of that, there would then be valid grounds for objecting to UK financial service providers benefitting from a market they were not supporting on the same basis as EU providers.

    This could hurt London, and Dublin could be a beneficiary.  Outside the EU, the UK could do little to stop this. The European Banking Authority would have to leave London and there would be a good case for relocating it in Dublin.

    SCENARIO 3: A CANADA STYLE AGREEMENT WITH THE EU

    Another option would be for UK just to seek a trade agreement with the EU, like Canada has. This option is favoured by some of those who want the UK to leave the EU, so it needs to be studied. 

    The first thing to say about this is that it would have to be negotiated within the two year time limit applying to a Withdrawal Treaty under Article 50, and would presumably have to be part of the Withdrawal Treaty. The existing Canada Agreement took 6 years to negotiate and dealt with a much less complex relationship than that between the UK and the rest of Europe.  It is very hard to see how all this could be done in the time frame. The European Parliament would actively involve itself in the details. The UK would be excluded from the European council discussions on the topic.

    A Canada type agreement would not necessarily mean continuing tariff free access to the EU for all UK goods. Some tariffs remain on some Canadian goods for the time being. It is unlikely that a trade agreement like this, or even a Customs Union of the kind Turkey has with the EU, would allow the UK access to the EU financial services market and financial services are one of the UK’s biggest exports.

    It is clear that under a Canada style agreement, the UK would have to comply with EU rules on any goods or services it wanted to export to Ireland or to any other EU member state. The UK would have no say in the framing of these rules, but it would still be bound by them.

    Of course, the UK would be free to make its own rules for goods and services sold within the UK, but the downside of that would be that UK firms would then have to operate under two different rule books, one for the UK and another for the EU, thereby adding to their costs and damaging their competitiveness.

    Once a Canada style agreement had been made, the UK would be out of the EU and would have no control over any further rules on new topics that the EU might need to make. The Canada agreement is clear that it does not restrict the EU making “new laws in areas of interest” to it. If the Canada model was followed there would be a Regulatory Cooperation Forum to cover this sort of thing. In the Canadian model, this Forum would allow: 

    •  “exchange of information and experiences”,
    •  “only provide suggestions and make no rules”
    •  “not have decision making powers”.

    In other words, the UK would be in a worse position than it is as a voting member of the EU. If, after the UK had withdrawn, the EU deepened its service market further, allowing new access rights across border  for service providers within the EU, the UK would miss out on this and would have to negotiate  access for its service providers on a case by case basis. The rights of the 1.8 million UK citizens now living in EU countries would also be less secure. UK citizens, living in Ireland or the continent, would enjoy only what Canadians enjoy.

    WHAT WOULD HAPPEN TO EXISTING EU TRADE DEALS, AND TO EU LAWS NOW ON THE  UK STATUTE BOOK?

    Furthermore, the UK would have to start from scratch negotiating trade agreements with countries all over the world, to replace the trade agreements it now has with all those same countries as a member of the EU. The UK Parliament would certainly be busy as well, in that it would have to pass new UK laws to replace all the EU regulations that are now part of UK law.

    The only alternative to this would be for the UK to decide to leave all the “acquis” of EU rules and regulations, which are now supposedly so objectionable, on the UK statute book, as they are, for a long time to come. One proponent of UK exit from the EU, Lord Lamont, admitted, in a debate with me recently that this is what they would have to do. Leaving the EU, only to leave EU rules on the UK statute book, seems like a lot of trouble to achieve very little!

    A SECOND REFERENDUM?

    There would be no second referendum on the final terms of any Withdrawal Treaty. This has been made clear by Chancellor Osborne. That has to be his position because, if there was to be such a referendum, the choice would presumably be either to leave on the basis of the terms of withdrawal Treaty, or stay in on the basis of the EU membership exactly as it is today.

    If such a second referendum was formally in prospect, it is hard to see that the EU side would have any incentive at all to offer the UK any concessions at in the Withdrawal Treaty negotiations. They would be mad to do so, because all the concessions would achieve, would be to make withdrawal more attractive.

    CONCLUSION

    I believe that the architects of the UK’s renegotiation/referendum strategy did not adequately consider how hazardous the voyage is, on which they have so casually embarked. They may have overestimated the EU’s political capacity to devise yet another special deal for the UK. Ireland, for its part, will have to adopt a very tough, deliberate, and multifaceted negotiating strategy, as long as this avoidable uncertainty prevails.

    John Bruton Elections EU Member States European Union Euroscepticism

    John Bruton

    BREXIT scenarios

    Blog

    29 Jan 2016

  • Security of energy supply is one of the three main objectives of the EU energy policy, on a par with competitiveness and environmental protection. However, prominence of the energy security as a policy area rose with the 2009 gas crisis and the 2014 conflict in Eastern Ukraine, prompting the EU to adopt Energy Security Strategy.

    According to the strategy, EU countries should strengthen their ability to face possible supply disruption and improve coordination of their respective emergency and solidarity mechanisms. They should further reduce their dependency on particular fuels, energy suppliers and import routes and increase domestic energy production, while taking demand moderating measures. 

    All these goals have been long on the policy agenda of the V4 countries. After the exposure to gas crisis in 2009, considerable improvements in terms of route diversification have been made. However, there are new challenges, mainly stemming from geopolitical situation and possible new gas infrastructure that could disrupt the ongoing integration into a bigger regional gas market. V4 power sector has been long viewed as relatively unproblematic compared to gas sector but new and very serious challenges are arising with adoption of ambitious environmental policies and growing RES volumes. 

    This paper provides a brief overview of the main challenges and areas we view as problematic or particularly important. It is a subjective selection, covering only power and gas sector issues. To make the paper concise and relevant, we chose not to touch upon other important energy security related issues linked to oil, coal or nuclear fuel. Also, to put the discussion below into a context, we provide some key statistics for gas and power sector in V4 countries but we do this in the annex to save some space and maintain the focus.

    The second part of the paper contains recommendations that would help policy-makers address the current challenges and strengthen the energy security in the Visegrad region and the EU as a whole.

    Energy EU Member States Resources Security

    V4 – Energy Security and Regional Markets: Challenges Ahead

    Other

    20 Dec 2015

  • Prime Minister David Cameron’s letter to European Council President Donald Tusk about the renegotiation of the terms of UK membership of the EU shows that he has invested time in trying to understand the perspective of other EU states. This is good. 

    That said, the timing of this renegotiation is bad, because the EU has so many other politically difficult problems on its plate just now, problems from which the UK has excluded itself, namely: 

    • the refugee crisis and the threat it poses to free movement within the Schengen zone
    • the fact that a number of EU states are at risk of breaching the terms of the fiscal compact on debt reduction and fiscal deficits.

    A supportive attitude by the UK on the resolution of these EU wide problems would help create the impression that the UK is, potentially at least, in the EU for the long haul, which would make it worthwhile for other members to go all the way to their bottom lines in attempting to meet the UK’s requests.

    It is welcome that David Cameron’s letter says that he is open to “different ways of achieving the result” he sets out in his letter. It is also welcome that he seeks to put his proposals in a context of “reforms that would benefit the European Union as a whole”. He further says that it “matters to all of us that the Eurozone succeeds”.

    Although David Cameron has expressed similar sentiments himself before, these sentiments have not been prominent in much of the general UK debate on the EU, which has often tended to treat the EU as something alien and a matter of indifference to the UK, which objectively it is not. Occasionally in the UK debate, “schadenfreude” has trumped UK interests.

    David Cameron’s approach is shaped by the contents of the Conservative Party Manifesto. It is a response to an expression of identity politics, which is a form of politics on which compromise is inherently very difficult indeed, as we know from Irish history. David Cameron’s letter deals with four sets of issue, and I will deal with each in turn.

    ECONOMIC GOVERNANCE

    On Economic Governance of the EU, David Cameron  says that: 

    • the integrity of the Single Market for non Eurozone countries must be protected
    • that non Eurozone countries must not be liable for operations to support the Euro as a currency
    • that the financial supervision of banks must remain a matter exclusively for national institutions in the non Eurozone countries and that
    • any issues that affect all member states must be decided by all member states.

    I am not sure that these issues can be as neatly separated as David Cameron suggests. For example, the bailout of Greece by the EU and the IMF was not just an operation in “support of the euro as a currency”. If Greece had gone under, UK banks would have been hit hard.

    Furthermore, it is arguable that, even if it is not in the euro, the UK had a greater obligation to help a fellow EU member, in the situation Greece was in, than had (say) the United States. After all, the UK, even if not in the euro,  as a member of the EU, had agreed to treat economic policy as a “matter of common concern” with all other EU states, including Greece, under Article 121 of the EU Treaty.

    Furthermore, the UK has had power to join fellow members in warning member states like Greece if they were deviating from agreed economic policies under Articles 121 (4), and under Article 126 . Non EU states were not in that position. In light of those articles, it is hard to see that the UK, as an EU non euro member, could say it has no more responsibility for helping Greece, than has a country that is not in the EU at all. If the UK wants that to be the position, its role in EU economic governance under article 120, 121 and subsequent articles of the Treaty should be changed. 

    David Cameron also asks in his letter that the EU “do more to fulfil its commitment to the free flow of capital”, presumably across the whole of the EU and not just within the Eurozone. That sits uncomfortably beside his insistence that the Bank of England alone be involved in supervising UK banks lending across borders into the rest of the EU, including the Eurozone.

    As we in Ireland know, unsupervised flows of capital can contribute to bubbles in another country, and if those bubbles were to burst, none of the countries involved would escape the pain, including the countries whose banks had been lending the money, even if those countries were not members of the Eurozone.

    His principle that “any issues that affect all member states must be decided by all member states” is very widely drawn. Few EU decisions affect all members in precisely the same way. This principle could be interpreted to mean that the UK should have a vote on all Eurozone decisions. Virtually all Euro zone decisions will affect the UK to some limited and indirect extent , not least because the UK does so much business with the Eurozone. This is so even though David Cameron insists the UK will not be financially liable for any of those decisions.

    In a sense, his request could amount to the Boston Tea Party demand in reverse, namely as  a demand for “representation without taxation”.

    COMPETITIVENESS

    David Cameron makes an interesting proposal under the heading of Competitiveness. It is potentially a big opportunity for Europe. I hope it will be strengthened and emphasised in the negotiations. His proposal  is that the EU should “bring together all the different  proposals , promises and agreements on the Single Market,  on trade and on cutting regulation, into a clear long term commitment to boost the competitiveness of the EU, and drive jobs and growth for all”.

    This idea of a big competitiveness package, as a price for continuing UK membership of the EU, could be used to drive through changes that have been stalled for years by inertia in individual member states.  In Germany, for example, the implementation of Single Market rules is often blocked at the level of the Lander. France is another country that could do more to open its market to EU competition, to the advantage of French consumers.

    If the British are to get a credible package on competitiveness, it may be necessary to demand prior enactment package of measures at national level, in all member states, in the same way as the Greeks had to pass certain laws, before they could get access to bailout funds. There is, however, one aspect of David Cameron’s letter which could potentially run directly counter to his desire to complete the Single Market.

    This is a proposal he makes under the heading of  “Sovereignty”.

    SOVEREIGNTY

    Under this heading, David Cameron proposes that a group of national parliaments, presumably a minority, should be able to come together to stop what he calls “unwanted” (EU) legislative proposals.

    This idea that a minority could block a majority would alter the entire dynamic of EU decision making. It would make it hostage to the vagaries of national electoral politics in a new and unpredictable way.  We should not forget that Lord Cockfield, the UK Commissioner, would never have been able to create the EU Single goods market, without the majority voting created by the Single European Act.

     his proposal is actually as likely to be used against UK interests as in favour of what the UK wants under the heading of Competiveness. It is easy to envisage such a veto mechanism being used by a sufficient number of national Parliaments of other EU states to block legislative proposals to complete the Single Services Market or the Single Digital Market, both of which David Cameron wants, to protect some national vested interest.

    A  solution might be to exempt all Single Market related legislation from this blocking mechanism. Another solution might be to associate all national parliaments with the EU legislative process in a manner similar to the involvement of the Economic and Social Council or the Committee of the Regions, but without creating a new veto point.

    David Cameron also wants the UK exempted from the commitment to “ever closer union”. This phrase  has been in all EU Treaties since the UK joined and was in the EU Treaty when the people of Great Britain and Northern Ireland  voted in a referendum to stay in the EU in 1975. Essentially the UK wants to “constitutionalise” the idea that there are two types of EU members: those committed to “closer union” and those who are not committed to it.

    This is a formal recognition that there is a “two speed” EU. This idea may be welcome by some big states but not by smaller ones. If Britain is exempted from the commitment to ever closer union, it is not hard to imagine that other EU countries will demand a similar exemption. He says he wants this distinction to be “irreversible”, which implies that a future UK government could not decide to commit itself to ever closer union in future, without getting the permission of all other EU states, by means of a Treaty change, or the amendment of a protocol (which is the same thing legally speaking).

    This runs counter to David Cameron’s own expressed wish for flexibility in the UKs relationship with the EU. The notion of legal irreversibility is contrary to the British constitutional tradition itself, which declares that Parliament is not trammelled by external legal constraints. A legal device can probably be found to accommodate this request but it does raise a wider question of whether the UK will ever be satisfied.

    The UK already has special arrangements on the euro, on passport controls and on Justice and Home Affairs. The more exemptions it gets, the more exemptions it seems to want. Will this renegotiation/referendum process result in a full and final settlement, or will it just be an instalment This is not a mere debating point. If the UK will keep coming back for more, the EU will never settle down. Indeed other member states may not be prepared to go all the way to their bottom line, if they feel whatever they offer could never satisfy UK public opinion.

    IMMIGRATION

    Immigration is the area in David Cameron’s letter which has attracted the most comment. There is no doubt that the UK has been more open to immigration in the past than have many other EU states. This is partly because English is a second language for people from all over the world. The restraint David Cameron is proposing will not change that.

    Clearly, if one does not like immigration, the fact that English is a second language for so many of the world’s population has disadvantages, as well as advantages. On the other hand, the cost of living in London and the south east of England is already a strong deterrent to immigration to that part of the UK.

    David Cameron wants, if the UK remains in the EU, to be able to require that people coming to the UK from other EU states (presumably including from Ireland) must have lived in the UK for four years before they qualify for in work benefits or social housing. If this four year principle is accepted, it could be implemented in all other EU states for other purposes as well.

    David Cameron also wants to “end the practice of sending child benefit overseas”, which presumably means that an Irish worker in the UK could no longer get child benefit for his children, if the children are living in Ireland. The principle of not “sending benefits overseas”, if accepted , could conceivably be applied to pensions, which would affect the UK pensioners living in Spain.

    If one has to live four years in another EU country to get benefits, access to health services could also be denied to people living in another EU country. David Cameron then acknowledges that these issues are “difficult for other member states”. This is a revealingly narrow way of putting it. In his speech, David Cameron mentions “other member states” but does NOT mention Article 45 of the EU Treaty, which covers free movement of workers within the EU.

    Article 45 bans “any discrimination based on nationality as regards employment, remuneration and other conditions of work and employment”. There is no reference in this Treaty Article to any qualifying period of residence to be free of such discrimination. In the UK, tax credit payments are dependent on worker’s hours worked and income, and whether they have children.

    So restricting them would amount to discrimination in income, between a UK citizen and  EU immigrant, doing the  same job in the UK.  It would presumably apply to Irish workers in the UK who have been there for less than 4 years. It will be difficult for an Irish Government to consent to this. I would have expected David Cameron to have directly addressed the interpretation of Article 45 of the EU Treaties, rather than pretending the difficulty is with “other member states”. By targeting in work benefits so explicitly, David Cameron has left himself very little room for manoeuvre in light of the provisions of that Article.

    Indeed there were reports on the BBC this morning that the UK Government is now considering applying the 4 year rule to UK residents as well, which could mean that young, new UK born entrants to the UK labour market may not qualify for in work benefits until they have been working for 4 years. That would create a whole new swathe of people inclined to vote for the UK to leave the EU.

    CONCLUSION

    This negotiation will not be easy. Sides have already been taken in the UK , regardless of what may be conceded in response to David Cameron’s letter. The impact on the EU itself, of a possible UK exit, is incalculable. So also are the effects of the precedent the UK is setting, and the consequences for the EU, of conceding some the UK requests. Solving this politically generated problem will require statesmanship and imagination of a very high order indeed.  Keeping the UK in the EU is a vital matter for Ireland and for Europe. 

    Speech by John Bruton, former Taoiseach and former EU Ambassador to the United States at a seminar on “Free Movement and Labour Mobility in the European Union” organised by the Institute of European Democrats on Friday 13 November 2015.

    John Bruton EU Member States Euroscepticism Eurozone Leadership

    John Bruton

    How difficult will it be to keep the UK in the EU?

    Blog

    13 Nov 2015

  • The current refugee crisis is primarily one of collective action between the EU’s national governments. This In Focus argues that without cooperation between the EU states, the situation is not going to improve.

    Among the EU institutions, the Council, that brings together the heads of state and government, plays the decisive role in showing direction and facilitating agreement. As for specific policies, the EU’s dysfunctional asylum system, which is based on 28 national systems, needs to be reformed, including by allowing asylum applications in the countries of origin.

    Member states need to start supplying Frontex, the EU’s external border agency, with personnel and equipment so that the border can be better protected. Turkey, which hosts the highest number of Syrian refugees, is the EU’s main partner in the Middle East.

    The EU also needs a new deal between host countries and newcomers on the refugees’ integration into European societies. One side of this deal is for European governments and societies to demand that newcomers respect basic values, such as freedom of speech, equality between men and women and individual liberty. The other side of the deal is that those who are granted asylum are given opportunities in employment and civic and political life.

    EU Member States European Union Integration Migration

    The Refugee Crisis: Towards better cooperation between Europe’s national governments

    IN FOCUS

    16 Oct 2015

  • The period since the election of Syriza to power in January 2015 has been marked by increased political uncertainty, economic instability and a growing polarisation of public attitudes in both Greece and the EU. The reality of Syriza in power has worsened the underlying economic conditions of the Greek economy, reduced the ability of the Greek state to provide essential public services and led to a clear breakdown in trust with other EU members. The election of Syriza to power did not result in a fundamental restructuring of the Greek or European economies, rather their lack of a coherent strategy (beyond reneging on previously agreed support programmes) has set the reform process in Greece back by several years.

    The coming to power of Syriza marked the culmination of pent-up public anger and discontent at prevailing economic/political conditions and the impact of such conditions across wider society. Notwithstanding several years of support programmes, the Greek economy requires further reform in order to ensure its long term sustainability. The shortcomings in the assumptions underpinning the initial programmes undertaken by the EU/ECB and IMF were complemented by implementation weaknesses which further eroded public support for the structural adjustments required. This resulted in a clear division arising between those in favour of the support programmes and those opposed. 

    The level of financial adjustment required in Greece – over 20% of GDP – imposed significant socio-economic challenges. In the public mind, ownership of the reform process then passed from national bodies to imposed, supra-national institutions, thus increasing resistance at both public and political levels in Greece. Resistance fuelled by populist political parties seeking short-term political gain.

    Syriza in power has sought to deliberately widen the gulf between those who acknowledge the long term importance of the many difficult structural reforms required, and those who seek to blame “austerity” for Greece’s current woes. In reality, the experience of Syriza in power has highlighted its complete lack of a defensible economic and political strategy which safeguards Greece’s position in the EU, protects the well-being of its citizens and acknowledges the current standing of the Greek economy.

    IN FOCUS is a new series of commentaries in which the Martens Centre looks closely at current policy topics, dissects the available evidence and challenges prevailing opinions.

    Crisis Economy EU Member States Eurozone Populism

    Greece – Between farce and tragedy: Four realities of Syriza in power

    IN FOCUS

    16 Sep 2015

  • The political parties from across the European continent have formed transnational political families, based on their values. The ‘internationalisation’ of political parties started in the late nineteenth century, but it was brought to a completely new level once the European Parliament (EP) came into existence, as the parties then had the chance to compare their views and negotiate their positions on the same policy dilemmas at the same time.

    From the beginning, the Members of the European Parliament (MEPs) have formed parliamentary groups not according to their nationality, but according to their ideology—just as in national parliaments parliamentary groups are formed by the members who share similar policy orientations in order to better coordinate, share resources and exert influence on policy.

    This article analyses the voting behaviour of these pan-European parliamentary groups, whose cohesion and internal splits are used as indicators of the actual symmetries and divisions between national parties belonging to the same political orientation.

    How cohesive are the European parliamentary groups in the new term?

    The pan-European parties have long been considered mere consultative bodies, rather than decision-making ones. Power has always remained in the hands of the national party chiefs and the heads of state. Traditionally, the leading political figures within the EU institutions, whether commissioners or MEPs, have been seen as following instructions from their party bosses back home.

    But the aftermath of the 2014 European elections may indicate a change of direction. Since the Lisbon Treaty, the EP has become bolder, not only when negotiating legislation, but also when appointing the EU’s chief executives. MEPs have been able not only to create a united front among themselves but also to rally support among their colleagues at national level using the structures of the European parties. Ultimately, they submit their candidate for the presidency of the European Commission.

    Read for FREE the full article published in the June 2015 issue of the European View, the Martens Centre policy journal.

    Doru Petrisor Frantescu EU Institutions EU Member States Integration Values

    Doru Petrisor Frantescu

    Values topple nationality in the European Parliament

    Blog

    09 Sep 2015

  • Traditionally, political parties have had a large and fixed membership that they could count on for support. Not only was membership seen as permanent, but it was also passed down from one generation to the next. This relationship was an essential part of political life in our democracies. However, globalisation and technology, amongst other factors, have forever altered this reality. These phenomena have opened up a new world where citizens can engage in politics outside of the framework of political parties.

    Western society has changed from a church-centred community to an individualistic society. The ties between its members are weaker—and sometimes missing altogether. At the same time, people feel more connected than ever: via the Internet, reaching out to like-minded people has never been easier and more effortless. This combination of local disconnection and global connection has repercussions for politics as a whole and for political parties in particular.

    The free flow of information is vital for a modern, functioning democracy as it helps people to engage with their representatives. We very much encourage this flow, especially as democracy not only gives freedom and rights to citizens, but also gives them the responsibility of proactively engaging with the society in which they live. However, as we can see from Russian propaganda, information can be manipulated or distorted to create false perceptions. In this respect, political parties have an important role to play: not only must they guide citizens through the sea of available information, but they must also act responsibly when engaging with the media.

    While people are benefiting from the enlargement of their world, globalisation also seems to have instilled fear in citizens, by bringing previously unknown threats into their living rooms. Moreover, the economic crisis has created discontent among voters, not only about the practices in the financial world but also about how politics and the political establishment have handled the crisis.

    This has created the opportunity and made way for protest movements and new types of parties to emerge. Unfortunately, these new parties are strongly populist, lean to either the extreme left or the extreme right, are single-issue based or anti-establishment, and are polarising our society. Moreover, they fail to provide a feasible vision for the future of our community. It is worrying that many voters believe that these political parties are serving our democracy. However, we can do more than sit back and hope that these parties will destruct themselves.

    The rise of these parties offers an opportunity for people’s parties to show clear leadership and vision, and prove to our electorate that we do not shy away from taking difficult decisions and explaining them to the people. Established parties with well-elaborated policies are particularly capable of tackling the complexity of today’s challenges. However, such action may require people’s parties to modernise and effectively adapt to the new and empowered society that is emerging. Citizens are demanding results and proper representation. Furthermore, we need to make an effort to win back the hearts and minds of the citizens.

    The articles in this issue of the European View provide ample food for thought regarding the modernisation of our people’s parties to meet the needs of our new society. Some authors question whether the representative model of democracy is still valid, and propose the introduction of direct democracy or open source democracy, where citizens use the Internet to tell their representatives how to vote. Others believe that political parties remain the best vehicle for translating citizens’ concerns into policy, but simultaneously argue that the parties need to do more to engage citizens, to explain themselves and to serve voters.

    As the president of the European People’s Party, I too believe that the citizens are best served by the representative model and that political parties are the best-developed vehicles for this purpose. We have to make sure that we not only keep pace with developments, but that we also use these changes to engage citizens on the largest scale possible. It is important for democracy that parties behave responsibly and always act in the best interests of the whole of society—and not merely in the interests of those who have voted for them or even in the interests of the current generation. We need to look beyond the present and create sustainable solutions to ensure a secure future for our children and grandchildren.

    This editorial was originally published in the June 2015 issue of the European View, Martens Centre’s policy journal. 

    Joseph Daul Democracy Elections EU Member States Political Parties

    Joseph Daul

    The future of political parties

    Blog

    08 Sep 2015

  • A Daily Mail poll last week showed that, in a sudden change, 51% of UK voters now want to leave the EU, whereas 49% want to stay in.

    This big change in opinion seems to be related to the refugee crisis, because the poll also shows voters strongly favour David Cameron’s unwillingness to accommodate large numbers of refugees as against Angela Merkel’s support for all EU countries accommodating a substantial quota.

    This dramatic change in opinion shows how a referendum result on a particular day can turn on unexpected events, and how a permanent decision can be influenced by what may prove to be temporary phenomena. The UK already had a referendum on whether to stay in the EU in 1975. Now it is to have another in 2017. But will this 2017 referendum settle the question?

    Eurosceptics, like Nigel Farage, have welcomed the decision of David Cameron to change the wording of the question UK voters will be asked to decide on, from a “Yes” or “No” to UK membership, to one which asks whether UK voters want to “remain” in, or “leave”, the Union.

    This change was recommended to David Cameron by the Electoral Commission who felt the earlier formulation favoured those who wanted the UK to stay in the EU. “Leave” implies action, “remain “could be construed as endorsing passivity.  “Yes” would have implied positivity, “No” negativity. Generally people prefer to be positive. So perhaps Nigel Farage is right to be happy.

    The bigger risk here is not in the wording of the question. It is in the political reality that, in a referendum, temporary considerations, like anger at some current government policy on an unrelated matter may induce people to make a permanent decision that they would not make in normal circumstances.

    That is why I prefer parliamentary democracy to referendum democracy. In a referendum, the issue has to be reduced to a single question decided on a single day. In the parliamentary system the decision is usually taken over many months, in a process which allows greater flexibility, and opportunities to change direction in light of what is learned.

    But a referendum is what we are going to have, so it behoves everyone in all the 28 EU countries to do what they can to ensure, if they want the UK to stay in the EU, that the negotiation is concluded in a way that presents the EU in the best possible light to the UK electorate.

    The UK’s negotiating approach, and the frame of mind in which the UK people approach the negotiations are important here too. If the UK gets a good deal, that is endorsed in a referendum, will UK citizens then fully commit to the EU, or will they retain an attitude of conditional and sceptical membership, waiting for the next opportunity to find fault?

    In 2003, I was chairman of the committee of the Convention on the Future of Europe which dealt with Justice and Home Affairs. Our task was to redraft the provisions of the EU Treaties dealing with cross border crimes. The UK had long been suspicious of continental courts having jurisdiction over UK citizens and wanted to limit EU activity in this field.

    At each stage in the negotiation, the other parties to the negotiation went as far as they thought they could to accommodate UK concerns, only to find that once that was settled, the UK came back looking for more concessions on the same points. The Convention’s “final” draft of the proposed EU Constitution was not final. The UK looked for, and got, more concessions in the draft approved by the Heads of Government.

    Then, when the Constitution failed in referenda in France and the Netherlands and was replaced by a slightly slimmed down “Treaty” in Lisbon, the UK looked for, and got, even more concessions on their concerns, including a complete opt out, with a right to opt in at will.

    Will the other states go all the way to their bottom lines, in the negotiation of the “improved” terms of UK membership if they think the UK will adopt a similar tactic and keep coming back for more? They will ask themselves how an EU of 28 members would work, if every country that UK approach.

    Suppose the final deal is one that satisfies UK voters by a narrow margin, will future UK governments then be likely to go on looking for further concessions afterwards, on the same issues, every time there have to be any further revisions of the EU Treaties?

    If the answer to these questions is yes, and there are many in the UK who will never be satisfied with what the EU offers, then the other 27 members may hold back from their maximum concession. David Cameron may then find he has raised expectations in the UK unduly and may fail to convince UK voters to remain in the EU. Or he may find that his electorate wants to “experiment” with leaving the EU, just as many US voters want to experiment with Donald Trump, or some UK voters seem to want to experiment with Jeremy Corbyn.

    There also is the related risk that UK voters may see the referendum as an opportunity to “make a statement” about their sense of who they are, rather than make a final, fully considered, decision about the future of Europe. So we must prepare for the possibility of an EU without the UK.

    [Photo source: UK Electoral Commission]

    John Bruton EU Member States Leadership

    John Bruton

    UK’s EU membership: will the 2017 referendum settle the question?

    Blog

    07 Sep 2015

  • 340.000 recorded migrants crossed Europe’s border between January and June 2015: an unprecedented number for the EU. Conflicts and repression are raging in Syria, Iraq, Libya, Eritrea, Yemen with a level of intensity that current EU defence, development and humanitarian mechanisms simply cannot cope with.

    Europe is left with simultaneous challenges: ensuring control of our borders, maintaining societal stability, honouring our values and living up to binding international commitments to help refugees.

    In the short term, that means protecting the Schengen perimeter by fighting smugglers more aggressively and preventing terrorist infiltrations. This defensive boost could materialise in three ways:

    [1] Common Standards for Border Management as legal chaos reigns today;

    [2] Frontex, Europe’s border management Agency, should be allowed to initiate return missions and not just stick to operational assistance;

    [3] A European System of Border Guards should be created, targeting sensitive spots where flows are not manageable by Member States.

    Listing those technical points, one still feels overwhelmed by the amplitude of the catastrophe. Those refugees bring up the best of our instincts but also the worst. If those negative reactions prevail over our values of humanity and solidarity, then we have lost the battle to the radical groups who are responsible for this horror. Refugees should therefore be rescued, bearing in mind also that some will have to be returned. Europe faces dire political and economic challenges, in addition to investing in more forceful civil-military responses to the ongoing conflicts.

    Leaving the big politics for later, we will now list civil society initiatives across the continent that demonstrate the values Europe is built upon. We used the internet and our own contacts all over the EU and found a lot of venues to help. They are obviously many more out there:

    [Photo: Haeferl, Wikimedia]

    Michael Benhamou Pavlina Pavlova EU Member States Immigration Migration Values

    Michael Benhamou

    Pavlina Pavlova

    More Europe, Less Egoism: European civil society to the rescue in the migrant crisis

    Blog

    04 Sep 2015

  • This is the title of an excellent  book by Mark Mazower, first published in 1998, which I have just finished. Among the fascinating questions prompted by reading it are: 

    – Why did democracy, triumphant in the immediate aftermath of the First World War, become almost extinct across much of continental Europe in the following 20 years?

    – Was the League of Nations policy to protect national minorities doomed to failure and was the  alternative policy of ethnic cleansing, practised at the end of the Second World War, thus inevitable? Even to this day, European countries have not devised a good way of creating a sense of belonging among national and religious minorities? In some European countries, minorities now make up a disproportionate share of the prison population. Sport seems to be one of the few ways in which minorities are integrated.

    – Why did the leaders of Britain and France assume that Hitler could be appeased with territorial concessions, when “Mein Kampf” had suggested his ambitions were much greater?

    – Was there an alternative in the 1920’s to the return to the Gold Standard as a way of combating the rampant inflation that had been fuelled by the financing of the First World War? In a sense the euro, like the Gold Standard, is also a method adopted by many countries of breaking away from a previous  vicious cycle of inflation and devaluation

    – Why was the Soviet model so effective in the period from 1930 to 1950, in industrialising Russia and enabling it to defeat Nazi Germany, so ineffective afterwards in meeting the consumer aspirations of its citizens?  Mazower says Stalinism was a “bad idea, implemented surprisingly well”.  Communism collapsed later on, because Communist Party members had ceased to believe in it, and Russia itself had become tired of subsidizing its East European satellites to the extent of 2% of Russian GDP through artificially cheap energy.

    – Why did Hitler make the mistake of killing so many people (including 3 million Soviet POWs) who could instead have been put to work in his labour starved armaments industries?  

    – What accounts for the surge in marriage and child births in the aftermath of the Second World War, and for the unsustainable decline in birth rates in more recent times?  As the author puts it, “marriage has become a choice rather than a duty”.

    – Why did European countries diverge so much in the way they developed their welfare systems after the Second World War? The UK opted for a minimum income guarantee financed by taxes, whereas most continental countries opted for  pay related systems, whereby better off people paid bigger contributions to the state, but got bigger pensions on retirement. The result is that in many continental countries the biggest beneficiaries of “welfare” systems are the better off.

    – What will become of nation states, when so many of the important decisions have, in practical terms, to be takes at a multinational or supranational level?

    As the author puts it “nation states are becoming mere shells, with no real hold over policy, while alienation from government has increased”. Mazower says the real victor in 1989 at the fall of Communism was “not democracy but capitalism”. 

    But the problem we now face, as Europe tries to manage financial and banking issues, is that “capitalism does not create feelings of belonging capable of rivalling the sense of allegiance felt by most people to the state in which they live”. European Electorates continue to see all problems within a national framework, even though many modern problems cannot be solved in that framework.

    John Bruton Economy EU Institutions EU Member States

    John Bruton

    Dark continent – Europe’s twentieth century

    Blog

    30 Jul 2015

  • If Greeks themselves do not trust their own government and their own banks with their money, it is difficult to expect the taxpayers of other countries to do so. Yet that is what the critics of the severity of the conditions imposed for the third Greek bailout seem to expect.

    The euro was not imposed on Greece. It was something that Greece joined of its own accord. The fact that the possibility of Greece leaving the euro was raised by Germany, has been greeted by some as dealing a blow to the euro, because it supposedly ended the notion of the euro being “irreversible”. But nothing in political life is irreversible, even though some things, like the Byzantine and Ottoman Empires, did last a very long time indeed. “Irreversibility” was always a legal fiction, and fiction is not a sound basis for an economic policy. 

    The euro is a contingent compromise, where members trade some short term losses for greater long term gains. A euro, where rules were easily broken, would not endure. I agree with those who say that, eventually, some of the Greek debt will have to written off. That is both financially necessary and morally just. But that can only be contemplated when the Greek political and administrative system has reformed itself, and is capable of benefitting from a write off, and not looking at it as a precedent for a further write offs later on. We are not there yet. 

    The crucial difficulty seems to be that the Greek state does not work. The fact that Tsipras’ offer of reforms had to be crafted, not by Greek civil servants on their own, but with the help of French officials, tells its own story.

    Some complain that elements of the package involve intrusion on Greek “sovereignty”. But a state is only sovereign to the extent that it is capable of fulfilling the internal and international responsibilities of a state.  I believe Greece needs help in this regard, and it would be good if the World Bank, as well as the IMF, were involved in helping Greece reform its public administration.

    Recapitalising the Greek banks will be a major task. Interestingly the biggest national exposure to the Greek banks is  by banks in the UK. The UK is not in the euro, and is not contributing to the Greek bailout, which could be regarded as unfair.

    Some argue that the austerity, that Greece is going through to meet its international obligations, is damaging its economic growth prospects. In the short run, this is true. But fuelling temporary growth, by taking on even MORE debts, would not be an answer. That would weaken longer term growth prospects, because of the additional debt service it  would entail. This is the problem. The opponents of austerity never explain where the extra money would come from, other than from inflation and devaluation, and they solve nothing.

    The important way of  improving growth prospects is by  generating confidence. If people believe the future will be better, and can borrow money to invest in it, the economy will grow. With renewed confidence, some of the money that Greeks themselves have moved abroad will then come back to Greece. If the bailout terms are fully and quickly implemented, by both Greece and its creditors, that will restore confidence, especially if it is rewarded  by a prospect of some conditional and staged debt write offs in the future.

    Meanwhile, Greece is in close proximity to the biggest refugee crisis in world history, caused by the Syrian and Iraqi civil wars. More migrants are now arriving in Greece from the Middle East, than are arriving in Italy from North Africa. 65% of the arrivals in Greece are Syrian. Greece’s neighbour, Turkey, is already providing shelter at its own expense for 1.8 million Syrian refugees. Meanwhile most Western countries are reluctant to take in any refugees. Greece, because of its geographic position, does not have that luxury.

    The European Union should reorientate its Development Aid programmes to help middle income countries, like Greece, Turkey, Lebanon and Jordan, which are facing major refugee inflows, to cope with that huge burden. Some EU countries, like Germany and Sweden, are hosting many refugees. But most are keeping their heads down and doing little or nothing.

    There should be burden sharing, based on relative income and population. Countries that are receiving the largest proportionate number of refugees should be getting direct ongoing cash help from those that are receiving the least.

    John Bruton Crisis EU Member States Foreign Policy Human Rights Migration

    John Bruton

    Greece and the refugee crisis

    Blog

    14 Jul 2015

  • The present Greek debacle is the result of a clash of political cultures.

    On the one hand is the culture of the European Union, where every decision has to be mediated through complex institutions representing 28 different countries, each with its own political culture, and then often has to win the assent of the European Parliament and of an independent European Central Bank. Theatrical gestures and moments of brilliant eloquence count for little in this world. Building a good track record, with good civil service staff work to back it up is what counts in the EU political culture.

    EU bailout decisions also have to be approved by the IMF, a global body, most of whose members and clients are far poorer than the Greeks. This creates an additional layer of interests which Greece must try to satisfy, additonally to its EU partners. In this setting, credibility and patience are vital to success. The new Greek government did not have patience and soon it lost credibility as well.

    In stark contrast with what was needed, it seems to me that the Greek Government is made up of people who come from a revolutionary tradition, who believe that progress will come from a harsh rupture with the past, and whose proponents envisage a nationalist or socialist utopia once that rupture is complete.

    The Greek government are also people who have little or no previous experience of government. They have thrived politically by agitating against the existing order, without the necessity of explaining how things would work after they obtain power, and how they would survive and govern in the complex interconnected reality that is the global economy of today.

    That the Greek electorate would elect such people to office is explained by the desperation into which they have been led by the irresponsible policies pursued by successive Greek governments since the 1980’s, who tried to win the votes of Greeks by promising them a standard of living that was not matched by their productive capacity, and by the mistaken decision to take Greece into the euro before the results of these bad policies had been properly rectified. 

    The problem is that the activities of the new government made things much worse than they were when they took office.

    By creating doubt about whether they would honour the debts incurred by their predecessors, the new government created a crisis of confidence, and this loss of confidence led to a suspension of normal commercial activity. By looking for debt relief before reforms were implemented they put the cart before the horse.

    The underlying problem of Greece is a lack of productivity and export potential, but the Greek government, and to a great extent the EU authorities too continue to ignore this. Greece’s productivity problem will take years to solve, not least because Greece is an elderly society. The structural reforms urged by the EU will help, because they will clear the clogged arteries of the Greek economy and allow talent to be reallocated to where it can do something productive. But the ageing of the Greek society will remain an intractable problem.

    As a result of the drama generated by their new Government, Greeks, instead of focussing on ways to invest to make more money, became in recent months obsessed instead with protecting what they already had. Whereas the economy was on a path towards modest growth when the old government left office, it quickly plunged back into recession as money was withdrawn from the Greek banks, thereby further weakening Greece’s ability to meet its ongoing expenses, and to pay its debts as they fell due.

    The timing of the Referendum, AFTER Greece has already run out of money, and on a proposal that has already been withdrawn, could not be worse. It compounds the panic and uncertainty. It is probably in breach of the Greek constitution. Apparently the Greek constitution does not allow referenda on fiscal issues, and the bailout offer contains many elements that are fiscal.

    If ever there was a case study that shows how important it is to have political leaders who understand and face up to their responsibilities, and who deal with the world as it is rather than as they might wish it to be, it is to be found in Greece today. The lessons for Ireland are too obvious to require to be spelt out.

    John Bruton EU Member States Eurozone Leadership

    John Bruton

    Tsipras vs the rest: A clash of political cultures

    Blog

    03 Jul 2015

  • The debate surrounding a potential BREXIT has largely focused on the costs and disadvantages for Britain of making such a move. However, Britain leaving the EU would also alter the strengths and profile of the European Union. Britain is the EU’s second largest economy, a significant net contributor to the EU budget, hosts Europe’s only global financial centre and is an important driver of single market reform on the European stage. 

    In her absence, the EU will lose a key proponent of the market economy and free trade as drivers of economic growth and prosperity.  In this context, while BREXIT would be a catastrophe for Britain, it would also, as this INFOCUS identifies, fundamentally change the profile and focus of the EU. 

    The ongoing debate over BREXIT symbolises Britain’s detachment from Brussels based European affairs, a process hastened by the economic crisis of recent years. From a London perspective, long term doubts over the viability of the Euro have been reinforced by the depth of Britain’s economic recovery (relative to the Euro zone) and by the EU’s rule based approach to furthering economic governance.

    This detachment is physically apparent across the EU’s institutions. Although currently accounting for over 12% of the EU’s total population the proportion of British nationals employed in policy influencing roles in the European Commission has declined to just 5.3% in 2014. Less than 3% of all applicants taking the EU civil service exam (the concours) were British in recent years.2 In a wider context, Britain leaving the EU (and the uncertainty over the exact nature of the future relationship) poses a number of significant challenges for Brussels based policymakers.

    IN FOCUS is a new series of commentaries in which the Martens Centre looks closely at current policy topics, dissects the available evidence and challenges prevailing opinions.

    Brexit Economy EU Member States Macroeconomics

    BREXIT: Six ways it will fundamentally change the EU

    IN FOCUS

    26 Jun 2015

  • The paper examines the connections between Russia and far-right political parties in Europe. It argues that these close relationships are based both on ideology and strategy. The European far right sees in Russian President Vladimir Putin the model of a strong, conservative leader who defends traditional values and opposes the decadent West. Since most far-right parties are at the same time against European integration and anti-American, they also see a close relationship with Russia as a necessary foothold in order to achieve the gradual disassociation of their countries from Euro-Atlantic institutions. The Kremlin, for its part, views these parties as possibly being useful for the achievement of its own objectives.

    Thus, it is interested in gathering them under its wing. In this context, in recent years far-right political parties all over Europe have established cordial relations with Moscow. Far-right leaders pay regular visits to Russia, have meetings with Russian officials and often appear on state-owned Russian media. The fact that they are discussants with the Kremlin boosts their credibility at home and improves their image. At the same time, they are often invited to monitor electoral procedures in disputed territories, thus offering some sort of credibility and international recognition for the results of ballots. The secessionist referendum which was held in Crimea in March 2014 is the latest example of this trend.

    More generally, the conflict between Russia and Ukraine has offered a great opportunity for the expression of the pro-Russian sentiments of most European far-right political parties. These organisations see Putin’s policy as tangible proof of his resolve to impose his will on his opponents and to mark the reemergence of Russian power at the international level. From the Kremlin’s point of view, these parties can also help Moscow to expand its geopolitical influence. Even if Putin does not manage to see parties with pro-Russian leanings forming governments, he can still hope that their growing influence will exert considerable pressure on EU governments, especially as far as relations with Russia are concerned.

    EU Member States Euroscepticism Political Parties

    An Unholy Alliance: The European Far Right and Putin’s Russia

    Research Papers

    27 May 2015

  • The British Governments plan to renegotiate the terms of its membership of the EU do not come at a good time. The EU is tackling the possibility of Greece leaving the euro, and Ukraine going bankrupt while simultaneously being dismantled by force by Russia

    Now, while doing all that, the EU has also to address itself to a, yet to be revealed, British re-negotiation agenda. It is likely that this agenda, to some extent, will be shaped around David Cameron’s assessment of what he has a good chance of being conceded.  He is touring EU capitals to find that out. That is a sensible and pragmatic approach on his part.

    What he gets will probably not satisfy the 100 or so Tory MPs who simply want the UK to leave the EU. And with a majority of only 12, David Cameron cannot ignore these MPs.  Other EU leaders will have to judge how close they should go to their bottom line, just to satisfy opinion in a country which may  leave the EU  anyway.

    There is one issue on which David Cameron’s demands are already very explicit and clear…the rights of recent EU immigrants living in the UK. This may, or may not, include Irish immigrants living in Britain, but I expect it could be difficult in EU law for Britain, inside the EU, to discriminate in favour of the Irish against other EU nationals. 

    The Conservative Manifesto could not be clearer on the position of recent immigrants from other EU countries. It says that: “If (EU) jobseekers have not found a job within 6 months, they will be required to leave.“ This seems to be in direct conflict with Article 20 of the EU Treaty which gives EU citizens a right to “move and reside freely within the territory of (other) member states.”

    Furthermore, the Manifesto recalls that the Government  has  already banned housing benefit for EU immigrants, and goes on to say “We will insist that EU migrants who want to claim tax credit and child benefit must have lived here for five years”. This seems in flat contradiction of Article 45 of the EU Treaty which requires
    “the abolition of any discrimination based on nationality between workers as regards employment, remuneration, and other conditions of employment.” Tax credits are a form of negative income tax. If discrimination in respect of tax credits were to be permitted, it would become impossible, within the EU, to resist a proposal to apply different income tax rates, or different tax free allowances, to people of different EU nationalities.

    The irony of the UK Governments position is that they want a stronger Single Market, with greater freedom to sell goods and services, and move capital, across boundaries within the EU. But they wish to resist the freedom of movement of workers across EU boundaries ! This will be seen by many in the rest of the EU as ideologically biased, as well as discriminatory.

    Angela Merkel, a politician who always looks for hard evidence, will be interested to discover that, between 2005 and 2014, only 33% of immigrants to the UK came from other EU countries, like Ireland. Only 2.5% of all benefit claimants in the UK originate from other EU countries, and EU immigrants to the UK are only half as likely, as native UK subjects, to claim benefit.

    Another knotty question, within the UK itself, will be the position of the devolved governments in Scotland , Northern Ireland and Wales. For example, given their electoral support level, how can David Cameron exclude the Scottish Nationalists from the UK negotiating team? Offering to include them could be good politics. Excluding them from the negotiating team, if they requested a place, would make a Scottish exit from the UK more likely

    A UK demand  is likely to be the repatriation of more powers, from Brussels to the 28 member parliaments, including Westminster. The difficulty here is that a comprehensive “Competence Review” by the  UK Foreign Office, across the whole range of EU powers, failed to come up with  many concrete suggestions for powers that ought to be repatriated.

    The UK may also demand a “red card “ system, whereby EU laws, already approved  in the Council of Ministers and the European Parliament ,where the UK is already well represented in both, could be derailed  by vetoes from a number of national parliaments. This would prolong and delay, the already laborious, process of EU law making.

    It would also run directly counter to another UK demand, for completion of the EU Single market. For example, the outstanding matters of creating a Single market in Digital Services, in Energy, and in Capital for lending, all in the UK’s interests, require more new EU laws,  not less. 
    The unintended often happens in politics.

    The proposed “red card” would, I believe, be more likely to be used by other EU states  to block things the UK wants, than the other way around.

    These difficulties all suggest that David Cameron should seek to reframe the entire negotiation, both in the way he presents it at home, and in the rest of the EU.

    Rather than looking for exceptions for the UK, he should emphasise Britain’s capacity to take the lead in  the EU in clearing away barriers to economic growth across all of Europe, a stance that would play to his country’s strength, and would  put others on the back foot.

    John Bruton Elections EU Member States European Union

    John Bruton

    Cameron’s renegotiation will not be easy

    Blog

    27 May 2015

  • The  self declared Conservative and Unionist Party won the  General Election in England  by harnessing English Nationalism, and the Scottish Nationalists did the same in Scotland by harnessing Scottish Nationalism. The two nations, by the rhetoric of their respective election campaigns,  have thus set themselves on a collision course.

    The Conservative Party scared English voters with the prospect of a Labour Government taking office with parliamentary support from the Scottish National Party. English voters were persuaded that a Labour Government, dependant on Scottish Nationalists, would somehow steal English money for the benefit of Scotland.  If there was deep pro Union sentiment in England, this appeal would not have worked, but it did work.

    The implication of the successful Conservative ploy was  that Scottish Nationalist MPs, although freely elected to and sitting in the United Kingdom Parliament, would not be  fit to have influence on the fiscal policies of the government of the UK as a whole, simply because they are Scottish Nationalists. They are thus cast in the role of “second class” MPs.

    The Conservative Party was saying that Scottish Nationalists are not welcome as full participants in the Union, at least as far as having a say in the fiscal policy of the Union is concerned. That was a very anti Unionist stance for a self declared” Unionist” party to take.

    Meanwhile, the Scottish National Party itself won support in Scotland on the false premise that a Scotland separated from England could avoid austerity, whereas the reality is that an independent Scotland would, on present policies, have a larger proportionate fiscal deficit, than the UK( including Scotland) now has. Arguably, an independent Scotland would have to have more, not less, austerity.

    That is not, of itself, a reason for Scotland to reject independence, but if it opts for independence, it should understand, and be willing to pay, the extra cost. This was not teased out because, unlike almost any other country in Europe, Scotland has no serious, centre-right, fiscally conservative , party.

    This is not the first time that the Conservative Party has adopted English Nationalism as an electoral tactic.

    It did so in the 1911 to 1914 period, when it sought to de-legitimate the minority, Asquith led, Liberal Government of that period, on the ground that the Liberals were dependent for their continuance in office on the Irish Party of John Redmond, and were pursuing a policy of Home Rule for Ireland within the UK. The Conservatives even went so far, at that time, to advocate extra parliamentary methods to defeat the Home Rule policy of their duly elected UK Government.

    At that time, the Irish Nationalists, unlike their Scottish brethren today, understood that an independent Irish Exchequer could not afford to introduce some of the fiscal measures then being introduced for the UK, as transpired when an Irish Government in 1924 had to take a shilling off the old age pensions Lloyd George had introduced in 1909. Scottish Nationalists could learn from that.

    The difficulty for the Conservatives, in again adopting an overtly English Nationalist stance to win English electoral support, is its effect on Scottish opinion, over the next five years, while Scotland will being governed, as far UK matters are concerned, by a Conservative Party that  fought an election on the basis that  MPs the Scottish electorate have chosen ought not influence UK fiscal policy.

    Meanwhile the Conservatives are committed to a referendum on EU membership which could result in English votes taking both Scotland and England out of the EU, even though Scottish voters might, by majority in the referendum, vote to stay in the EU.

    In a Union where England’s population is so much greater than that of Scotland, Wales and Northern Ireland, the use of a simple majority referendum to decide such existential questions as EU membership is unnecessarily crude and divisive.

    It reduces subtle and difficult matters to a simple “yes/no” question, and takes no account of the fact that the four components of the UK are not only different in size and population, but also very different in political culture.  Imagine what would happen if there had to have been an EU wide referendum of the bailout packages for Ireland and Portugal!

    Nationalistic passions are all too easy to stir up, as a means of winning elections, but once kindled they are not easily or quickly extinguished.

    Now that the election is over, David Cameron needs to break with Westminster’s confrontational traditions, and adopt a consensual approach towards all the opposition parties and enlist their help in finding a way of devolving more powers to Scotland without aggravating the rest of the UK, and of negotiating with the EU on basis that will not further deepen divisions within the UK itself.

    John Bruton Elections EU Member States Euroscepticism Leadership Political Parties

    John Bruton

    An expensive victory for English and Scottish nationalism

    Blog

    11 May 2015

  • The creation of jobs across Europe remains a key economic and social challenge for the EU. Given the negative impact of the financial crisis on  European citizens, the EU’s ability to promote effective job creation policies will be viewed as a major success of the wider integration process.

    In this context, a new approach is required to provide a growth-based strategy for creating employment across Europe. What is required is an achievable strategy based on the realities of modern EU labour markets. This research, based on an analysis of six member states, provides a set of recommendations designed to reflect the current characteristics of the EU labour markets. This research concludes that:

    • EU employment policies should be simplified and better coordinated;
    • Clearly defined action s should be introduced to further improve labour mobility;
    • The focus of policymaking should be switched from combating unemployment to creating jobs;
    • It is possible to finance the recovery by bridging the gap between investment and reform.

    Economy EU Member States Growth Jobs

    It’s Our Job: Reforming Europe’s Labour Markets

    Research Papers

    04 May 2015

  • As I write, it remains unclear whether Greece will reach an acceptable deal with its creditors, who are mainly other European Governments.

    It is important to say that the recession in Greece has been much deeper than expected by those who agreed the original bailout package with Greece in 2010, a 25% fall in output as against a predicted 7% fall. The budgetary adjustments have also been bigger than in any of the other bailout countries.

    It must be acknowledged that, when Greece got a bailout from the other Governments and the IMF, the ultimate beneficiaries included banks, not only in Europe but also elsewhere.

    These banks had been lending to the Greek Government, long after they should have stopped doing so, and have forced Greece to confront reality. They assumed that, because Greece was in the euro, someone somewhere would ensure they were repaid.

    Yes, some the banks, who were thus saved from their errors by the bailout, were indeed German. But many of the banks who were rescued from their embarrassment were British and American, and the British and American taxpayers have avoided a proportionate exposure to the costs, through the Greek bailout, of saving THEIR banks!

    The Euro zone is bearing the main burden, while the others offer free advice.

    That said, it would have been in nobody’s interest, for a panic about Greece to have infected banks around the world. Bank credit constitutes 95% of the money we use, and a collapse in confidence in money could have had really devastating global consequences. Without confidence in banks, economic activity would have come to a shuddering halt.

    We would have had a crash, rather than just a crisis. Hindsight critics can ignore that now, but it was a real risk then. 

    The origins of the Greek problem are very deep and longstanding. For years, Greeks had been consuming more than they were producing, retiring on pension earlier than is normal in other countries, and running an educational system that had few links with the real economy. All these gaps were bridged by borrowing money from foolish investors, who averted their eyes from the profound underlying problems of the Greek economy.

    Meanwhile Greece supported a cumbersome and slow courts system, and an equally inefficient system of public administration and of regulating entry to professions. These systems got in the way of growth, because growth needs a capacity to move human and other resources quickly from less, to more profitable activities. Such systems might have been affordable in a very rich country, but Greece never was a rich country.

    Meanwhile Greece failed to develop a broad modern industrial sector. It relied too heavily on tourism and ship building. Greeks made money selling things to  other Greeks, rather than to the rest of the world.

    Greek businesses stayed small, not big enough to become exporters.  Indeed the proportion of micro businesses in Greece is very large, and this sort of business frequently under declares its income for tax purposes. This is part of the reason for poor tax collection in Greece.

    There is growth potential in the Greek economy

    A McKinsey study back in 2011 suggested, for example, that Greece could develop medical tourism (it has a large population of dentists).  I met someone recently who was waiting for ages a treatment for tonsillitis in Ireland, who went to Greece, and had the operation done in days. McKinsey suggested big scope for Aquaculture and food processing in Greece. Greece could develop its port infrastructure to provide a regional cargo hub.

    But none of these things can be financed unless Greek business people have access to a healthy banking system.

    The Greek banking system is far from healthy. Its capital is tied up in Greek government bonds. The credibility of these bonds has been called into question by the brinkmanship and loose rhetoric of the new Greek government. The uncertainty over whether Greece will still be in euro, in a few months time, also inhibits investment, and nationalistic rhetoric in Germany on that topic has added greatly to that uncertainty.

    Greece’s future needs to be underpinned by a credible plan that focuses on private sector led growth, backed by a healthy European banking system,that invests in productive Greek businesses, rather than just in Greek government bonds, as it did in the past.

    If that is to happen, it is not just Greece that needs to do a lot of homework, but the entire European Union. The EU needs a real banking union that allows banks to lend across borders to good projects wherever they are found in the euro zone. This needs common EU legislation on debt collection, collateral and the like.

    The fact that Greek, Irish, Portuguese and Spanish taxpayers have borne large burdens to recapitalise their banks, or have undertaken new debts, as part of a project to sustain the global banking system, also needs to be recognised by the rest of the world.

    This cannot unfortunately be done straight away. The problems that gave rise to the crisis must be understood, and fixed, first.

    The Greek election result would not lead one to believe that Greeks understand the source of their problems. And the credence that many voters elsewhere give to rhetoric that suggests that being “against austerity” constitutes an implementable policy, in a world of free capital movement, suggests that many do not understand what went wrong or what can realistically be done about it.

    But ultimately there must be an honest attempt to find a fair settlement of these legacy issues.

    A Global Debt Conference, some time before 2022, when Greece has to make huge repayments, should be considered.  It could be sponsored by the IMF, and might negotiate debt relief on the basis of the extent to which countries have, in the seven years between 2015 and 2022, implemented growth promoting reforms and achieved primary surpluses on their current budgets, taking account of the demography and the tax raising potential of each country.

    John Bruton Crisis EU Member States Growth

    John Bruton

    The long crisis in Greece

    Blog

    15 Feb 2015

  • Forty rounds of applause celebrated the thirty minute speech given by the new President of the Italian Republic, Sergio Mattarella, in front of a joint session of both Houses of Parliament.

    Mattarella, who is 73 years old, was elected last Saturday, 31 January, with a considerable majority of almost two thirds of the eligible electors. “My thoughts go, above all, and before everything, to the difficulties and hopes of our fellow citizens. That’s enough,” he said right after being elected by the Parliament.

    A former professor of Parliamentary Law, the newly-elected President sat as a judge on the Constitutional Court after being a Member of Parliament from 1983 to 2008, serving as Minister of Parliamentary Relations from 1987 to 1989, Minister of Education from 1989 to 1990 and as Minister of Defence from 1999 to 2001. From 1998 to 1999 he also had a one-year experience as Deputy Prime Minister. He has a long Christian-Democrat family tradition– his father, Bernardo, was one of the founders of the Italian “Democrazia Cristiana”.Mattarella entered politics after his brother Piersanti, then President of Sicily, was murdered by the Mafia in 1980.

    One of his first priorities as the new President will be pushing the process of economic and institutional reforms ahead. Italy is now at a crossroad and reforms constitute the main legacy left by former President Giorgio Napolitano to his successor. A specific focus on the Italian electoral law, which is soon to be voted in the Parliament, is expected due to the expertise of Mattarella in this field (he drafted in 1993 the “Mattarellum”, the electoral law introducing the majority system in Italy).

    Mattarella’s agenda will also feature his response to the economic crisis, social exclusion and unemployment. In his inaugural address to Parliament, he pointed out the urgent need for job market reform: efforts to reshape the job market and improve mobility are essential to give hope to workers –especially the young ones – and those that there are looking for jobs. Mattarella has vowed to push ahead with digital innovation in Public Administration, to encourage more participation of citizens in decision making.

    Mattarella has also unveiled his plan to fight the spreading frustration with politics in Italy, due also to the high distrust earned by politicians among Italian population. While unemployment rates are increasing and condition of life are generally decreasing, politicians are considered in Italy as a real “casta”, blamed for focusing much more on their own interests than on those of Italian people.. He also referred to “the indignation of younger MPs” in his speech – which was read as a reference to the euro-sceptic 5 Star Movement. These MPs should contribute and support, according to what Mattarella said, a deep change in both society and politics, based on responsibility for the country’s well-being.

    Mattarella showed his commitment to fighting crime and corruption – implicitly referring to the scandals that recently hit Rome’s municipality. He vowed to safeguard the natural and historical treasures of Italy. He recognised the value of solidarity, endorsing the integration of ethnic communities. He mentioned the importance of family and traditions.

    Mattarella’s speech emphasised that Europe offers a framework for facing tomorrow’s challenges and also the importance of the EU as a political union. Here, reference was made to the growth strategy that the Italian presidency of the Council has tried to pit against the focus on fiscal consolidation dominant in Brussels.
    Political observers are still uncertain as to how they should interpret Mattarella’s election, whose name was the only one presented by Prime Minister Renzi and then swiftly approved by Parliament, after a tough round of negotiations with the different political parties. But Mattarella has made it clear that he will remain an impartial referee as Italy strives for structural reforms – to be achieved by parliamentary approval and not through governmental decree.

    The high estimation for Mattarella, coming from all corners of Italian political life, could help him in accomplishing his tasks and mission: certainly, it clearly shows the strong link that Italian politics still has with Christian Democratic values and traditions. His respect for the institutions and conscientiousness of duty as head of state reflects his personality:  a great defender of the Constitution on which Italians can hopefully rely on.

    Paolo Brandi Elections EU Member States Leadership Political Parties

    Paolo Brandi

    Sergio Mattarella: the new constitutional “referee”

    Blog

    11 Feb 2015

  • We live in turbulent times. Our world is facing serious challenges: Ukraine is struggling for its very survival, while Putin expends all efforts to prolongue his regime; the Islamic State is waging unspeakable violence across the Middle East while the threat of major terror attacks has returned to Europe; the political establishment is being undermined by a new vawe of populism; the Euro is weaker than ever before, threatened by the twin economic woes of stagnant growth and deflation. And if all this was not bad enough, elections in Greece brought victory to a political party that aims to maintain its place in the Euro club while disregarding all its rules.

    The new Greek PM claims that “Greece needs space to breathe.” Translated into plain language: a Greek politician won the post of prime minister on the promise that he would negotiate softer terms for repaying (or even writing off) financial aid, which Greece still needs.

    And that is the central problem. In fact, the position that will be taken by other members of the Euro area, by the EU, by the European institutions, can become a dangerous precedent for gamblers of Tsipras‘ ilk in other EU countries. Brussels-bashing, Europe-bashing, has become not only fashionable – it has even become an effective tool for scoring success in the domestic political sphere. This is evident not only in post-communist countries, but also in states with more established democratic states. The blame on “evil” Europe is laid by Cameron in the UK, Le Pen in France, Geert Wilders in the Netherlands. But if the EU gives in to Tsipras, a moral contagion will spread. Blackmailing the EU and its disciplined and responsible members will likely come from Spain, Italy and Portugal. The countries that, albeit with many difficulties, are managing to climb out from the bottom of the economic and financial pit.

    The populist movement Podemos is gaining in strength in Spain; Italy has Beppe Grillo; the Portuguese populists could be expected to also raise their voice; and the Irish, who have made significant reform efforts in the recent years, are already seeing surging support for Sinn Féin. If the EU and the Eurozone waver and yield to the demands of Tsipras, the project of a unified Europe would be shaken to its very foundations.

    Therefore, the next few days and weeks will be a moment of truth: for Greece, as well as for the whole Euro area and the EU. I believe that the bailout funds have supplied abundant oxygen for countries at risk, including Greece. Many politicians paid a heavy political price for committing their countries‘ finances to bailing out Greece and other countries. Greece faces a serious test of its resilience but also of its civil and political maturity. This includes awareness of the fact that support and solidarity also have their limits. Greece has only two currently viable options: either Tsipras comes to terms with reality in a broader, i.e. the European and the global context, or he is swiftly replaced. Any other option would cause the Greeks much more pain.

    But we will soon learn the truth about ourselves and about our united Europe. We will get the answer to the question of whether we are capable of taking a strong, principled and thus a forward-looking position, or whether the Eurozone and the EU will be rocked to such an extent that they eventually fall apsunder. What could destroy us is weakness and yielding to populism. The European institutions – both public and private – have had sufficient time, mainly due to the operation of new financial mechanisms, to prepare for a situation where a Member State would be incapable or unwilling to fully function as a member of the Euro area. Potential losses from giving in to populism would be significantly greater than the possible exit of Greece from the Eurozone. Bowing to populists would destroy the project of European integration.
     

    Mikuláš Dzurinda Crisis EU Member States Leadership

    Mikuláš Dzurinda

    The moment of truth

    Blog

    03 Feb 2015

  • Greek elections were not about the end of austerity and debt-write off. This was just an election narrative that captured the hearts of the Greek electorate and, surprisingly, dazzled large majority of the pundits, commentators and economists in Europe.

    As good as it gets

    As financial analysts are explaining, countries like Italy, Spain, and Portugal are spending larger share of their GDP to service their official debt than Greece. Much of the debt has already been written off or “hair cut”, a lot has been reprogrammed, postponed, the interest rates on the European loans are quite small. The troika is not requiring any substantial new austerity measures anyway. Much of what Syriza claims it wants has been done already.

    In the words of Daniel Gros: “… in the end, the difference between a government that has never made good on its promises to pay and a government that promises not to pay might not be that large.”

    If not much will change with respect to debt and austerity, what was this election really about then?

    Economy?

    The problem of Greece is that it is not competitive, exports are sluggish and foreign investors are avoiding it. There is much to be done to make the country friendlier to entrepreneurs. This may include liberating the markets from the capture of tycoons and family networks that prevent fair competitive capitalism. It also includes a more efficient public sector.

    The elections were hardly about this either.

    Instead of a debate how to achieve that Greek economy would earn more, the elections were a mix of national and social populism. Like any populists, Syriza exploited natural and (in fact positive) instincts of compassion and patriotism.

    National and social populism

    The national populism was manufacturing an outside enemy in Europe and particularly Germany. The social one was spreading hatred towards capitalists and was promising hand-outs that the Greek citizens should be getting. Cheaper rents, cheaper oil, higher minimum wage, even more employment in the public sector …

    National and/or social populism has proven a receipt for populists, anarchists and radicals to get to power. Generally few people fall for it. But under special circumstances, like war or major crisis, it works. As we have learned the hard way in the 20th century.

    What is also needed is wishful thinking by democrats. A conviction that what populists say is what they really want. Like ending the humiliation of a country and all will be well; abolishing a treaty; some other small concession.

    Economists (equipped with a hammer they too tend to see all problems as nails) are already proposing a compromise between what Syriza wants and what the EU and the creditors need to stick to.

    Power. To the “people”

    The real danger of Syriza and other populist left and right wing parties is their ambition for revival of ideology that has been proven wrong in the 20th century. Its essence is a disrespect for the human rights, the individual, her life, freedom and property.

    The fight against domestic and foreign enemies in the noble name of social justice and patriotism was just a pretext, a side show, a slide show, to capture the hearts of the voters. Let’s not mistake this with the real agenda of the radical left – which is capturing of power and ruling the country, perhaps Europe, according to their ideological agenda. The agenda is to shape a “radically new post 2008 world”.

    Center left and right

    The radicals and populists may not be alone in this. Tony Judt once wrote that the Western European social democrats were always envious of their Easter European communist comrades. The latter could exercise the leftist agenda without the trouble of elections and without checks and balances of democratic society.

    Today, traditional European left has a choice to make. Are left wing populists and radicals an ally or a competitor? Should they celebrate their success and join them in their struggle for a “better” world. Or see them as an enemy of democracy and liberty and therefore incompatible with modern Europe.

    While the left may be inclined towards appeasement, the center right must confront populism with reason. That there are no free lunches. That hard work pays. That opportunities are there to exploit for everyone. That jobs are created by entrepreneurs and the role of the state is to make sure there is fair competition among them.

    That solidarity is important too and it is not just an internal affair of each member state. 

    Revival of populist and radical utopian regressions, not the debate about more or less austerity, is the story behind the curtains in Greece and beyond. Debating austerity and hoping for an economic compromise is a discussion about a smokescreen. Not entirely irrelevant, but definitively not central.

    Žiga Turk Crisis EU Member States Growth

    Žiga Turk

    Greece: it is not about the austerity

    Blog

    02 Feb 2015

  •  the pension reforms and tax system changes made. These policies would not be advisable in the country’s current economic environment. In fact, they are the same measures that got Greece into trouble in the first place, risking the deepening of the country’s debt burden and economic and social fragility. Pardoning the debt without changing the economic fundamentals will lead Greece into a next crisis soon.

    The New Democracy’s programme proposes to continue with economic reforms to boost the country’s growth and competitiveness. Granted, many argue that the party could have done more to reduce the burden of the crisis on the private sector and to protect SMEs from going bust by improving the framework conditions for businesses to be able to continue operations in more efficient ways. However, their promise to support economically sound measures should be given an act of faith.

    Greece will stay in the Europzone; sceptics will be proven wrong

    Greece needs to elect leaders that have the credibility in front of Member States and towards private investors to govern the country responsibly. If Syriza wins, there is no certainty that the country stays in the Euro area, in spite of what it promises in the elections. Syriza will not be able to deliver only the attractive part of its programme. If they are left to apply economic utopia, people will burden the cost. Since their programme is not realistically able to bring the country back to growth, Greece will become even less credible for international lenders and unattractive to investors.  

    With the economy in its current state, it is unlikely that a Grexit would devalue the country’s debt; it might actually increase it. An exit of Greece from the euro would create even higher political instability, significant market turbulences and would actually increase borrowing costs for Greek businesses. Ultimately, the society as a whole would have to bear further costs and the sacrifices already made by the people are put at risk.

    Therefore, in spite of what Eurosceptics believe, it is in Greece’s interest to stay in Eurozone. Given the current debt situation topping 175% of GDP, the re-scheduling of the debt repayment from 30 to 50 years would be a possible scenario under these circumstances. In addition, Greece would be on track to finalise the current bailout programme and get ready to enter international markets with more favourable interest rates in the longer term.

    The population needs to be better informed about the possible consequences of voting for Syriza. Not taking the route of structural reforms, as Syriza proposes by reversing the already achieved results, poses a high risk to the country’s future welfare.

    Siegfried Mureşan Elections EU Member States Eurozone Political Parties

    Siegfried Mureşan

    Greece: Forward not backwards

    Blog

    22 Jan 2015

  • Greece is heading into what may well be its most important election this decade. I think the real difference between the two major Greek parties vying to lead the next government, New Democracy (ND) and SYRIZA, is not, as often assumed, whether Greece should continue with the economic oversight programme drafted by the Troika. Rather, this is but a symptom of their underlying fundamental divergence in terms of how they perceive European politics and the way they evaluate Greece being a part of the Eurozone.

    The party that is currently leading in the polls, SYRIZA, offers a complicated narrative. Given the fact that it began as a coalition of parties positioned at the extreme left of the political spectrum and that it could count on only 4-6 % of the vote before the crisis, this is to be expected. The party has undergone a radical structural and political change the last three years and yet remains different from the monolithic parties that we usually observe in Greece.

    There are two observable and differing narratives present within the SYRIZA organisation.

    Firstly the narrative sponsored by the internal opposition, meaning the group of party officials that is still very much attached to the idea of a socialistic transformation of the state and society. For these party members, SYRIZA, on its way to power, must keep its radical left credentials intact. Hence, a government led by SYRIZA should inevitably apply policies that are destined to achieve a general redistribution of wealth in favour of lower income earners. Moreover if the Troika is unwilling to accept such a programme, then it is inevitable that a SYRIZA government will break loose from the countries prior commitments leading Greece out of the Eurozone.

    All in all, for a substantial minority of SYRIZA’s membership, the Euro is a symbol of capitalistic oppression- a barricade that hinders Greece’s path towards a more just and equal society. Therefore if this hypothesis is ‘proven’, after the elections, then SYRIZA’s left platform will certainly suggest that the country should break ranks from the Eurozone establishment.

    On the other hand SYRIZA’s ruling majority is structured around the party’s president, Alexis Tsipras. This faction has been at the forefront of the effort to moderate the party’s position and broaden its base of support. SYRIZA’s leadership has tried to water down its leftist rhetoric by taking moderate positions regarding public order and national security. Nonetheless, SYRIZA’s stance towards the EU remains quite radical and utopian.  For SYRIZA’s ruling officials, the EU is considered an entity that needs to be transformed radically in order to serve the people of Europe. Thus they see their ascendance to power as the ideal opportunity to initiate a popular wave that will transform the European establishment.

    SYRIZA sees parties like Podemos in Spain and similar social movements in Italy as the first signs of a new order that will start taking over Europe after Tsipra’s election as Greek PM. Driven by this mindset, SYRIZA’s official political stance is that Europe’s popular dynamics will effectively abolish the current austerity programs and that the governance of the Eurozone will be effectively reoriented towards the goal of a fairer society. Within this context, SYRIZA believes that dilemmas like whether Greece will sign a new memorandum in order to stay in the Eurozone will become irrelevant.

    The contradictory narratives inside SYRIZA have become more obvious as the election campaign has unfolded. The presidential team around Tsipras has spent much time and energy, during the campaign month, on trying to water down the rhetoric of the most radical members of the party. Given that there are only a few days left to the elections, such an incoherent narrative is very problematic. A party that may soon be called to form a government and take difficult decisions is expected to be more comprehensible when it comes to basic questions of economic and monetary policy. All this is to say that SYRIZA is failing to answer the billion dollar question: what will happen if the social movements, that they predict will unfold after Tsipra’s election, do not surge to power across Europe?

    Then Tsipras will find himself having to choose between two distasteful alternatives. He can renege from his previous commitments and sign up for a renewed round of austerity and economic oversight – triggering a series of intra-party rifts that may lead to his eventual ousting from power. Or else, he must act unilaterally and declare his disobedience to the agreements previously signed by the Greek state.  Such a decision would, de facto, lead Greece out of the Eurozone and into economic demise. All in all SYRIZA, especially its ruling elite, is once again faced with a fundamental question that has occupied the Left for a prolonged period of time: what if the history is not on their side after all?

    Moving forward, the only alternative to SYRIZA and the second party in the polls right now is the centre-right New Democracy (ND) (the Greek EPP member party and the majority coalition partner in government). ND’s position on the above issues is far simpler and clearer.  For them having the Euro is not only an economic and political necessity but also an existential one. Thus ND accepts that Greece may have to accept some type of economic oversight in order to ensure its place inside the Euro. All in all the main centre-right party in Greece sees the euro and the country’s European status as  non-negotiable assets that grace the country with prestige and benefits and set it apart from the rest of the Balkans.

    Such a perception is not limited to the centre-right but shared by the majority of the Greek voters. Although this may not be the major criterion that will decide the winner of the elections it is for sure that the next government will have to guarantee the country’s position inside the European edifice. Whoever fails to do so will certainly have history against him.

    Angelos Angelou Elections EU Member States Eurozone Political Parties Populism

    Angelos Angelou

    The real difference between Greece’s main political forces

    Blog

    21 Jan 2015

  • President Putin’s decision to cancel work on the South Stream pipeline may have far-reaching consequences regarding the development of a single energy market within the EU. Although Commission President Juncker (and Bulgarian Prime Minister Borissov) have publicly stated that South Stream remains a potentially viable project, its de facto mothballing by Russia provides the EU with an opportunity to develop alternative energy scenarios in south east Europe. 

    These are scenarios which would improve both the diversity and security of the EU’s energy supply.  This IN FOCUS sets out five key reasons why the end of the South Stream pipeline should mark the beginning of moves towards an European energy union.

    IN FOCUS is a new series of commentaries in which the Martens Centre looks closely at current policy topics, dissects the available evidence and challenges prevailing opinions.

    Energy EU Member States EU-Russia Renewable Energy Resources

    European Energy Union: Why the end of South Stream should mark its beginning

    IN FOCUS

    16 Dec 2014

  • There is an ongoing debate about budget cutting in the world today, because revenue coming in is not matching the promise Governments made to their people of availability of pensions, unemployment support and health services.

    This problem is particularly acute in countries whose populations are getting older faster, like Finland and Germany. Who would suffer most if crude, across the board cuts in Government social spending were made? The table below, which appeared in a recent OECD report, shows some surprising results.

    In some countries the top fifth of income earners are the biggest beneficiaries of social supports in the form of cash payments from Government! In fact, France, Italy, Austria, Portugal, Ireland and Spain give a higher share of their cash social supports (pensions, unemployment and disability supports) to the top fifth of their population than to the bottom fifth. 

    In contrast, Sweden, the UK, Finland, Belgium and the US give more to the bottom fifth. The share of cash benefits paid to households in the lowest income fifth of the population is highest in Norway and Australia at 40%, compared to around 10% in Mediterranean countries and 5% in Turkey. In these latter countries, social transfers often go to richer households, because these benefit payments are often related to a work-history in the formal sector and often concern pension payments to retired workers. Earnings-related social insurance payments also underlie substantial cash transfers to the top income fifth in Austria, France and Luxembourg.

    Perhaps the most striking thing about this chart is that the average OECD country distributes almost exactly 20 per cent of cash benefits to both the top and bottom fifth of the income distribution. Some governments do less “social spending” in places where the private sector fills in the gap, particularly when it comes to pensions and health insurance. In the Netherlands, Denmark, the US and the UK for example, private pension payments are worth about 5% of GDP each year, while American spending on private health insurance is worth nearly 6% of GDP.

    Some countries spend more on those of pension age, others spend more on those of working age

    There are interesting contrasts in where the money goes. Pensions paid by government are 5.3% of GDP in Ireland and 5.6% of GDP in the UK, but they are 13.8% of GDP in France, 14.8% in Greece and 10.6% in Germany.

    In contrast, income support  by Government for those of working age  are 8.3% of GDP in Ireland, as against  just 4.7% in France, 5.1% in the UK, 3.8% in Germany and a mere 3% in Greece (notwithstanding the country’s high unemployment).

    In Ireland’s case, it is worth noting that 40% of the unemployed who receive income support from government are long term unemployed (i.e. more than a year out of work). The OECD has said that their skill levels are inadequate to the modern economy, which is a big long term concern. The longer people are out of work, the harder it is for them to get a job. I heard one person describe the experience of long term unemployment as worse than losing a spouse.

    Meanwhile, the number claiming various forms of illness benefit has increased by 47% in the last 14 years from 150,000 to 220,000. This is surprising in light of the improvements in spending on health services in Ireland in recent years. Health spending as a percentage of GDP is 8.6% in France and 8% in Germany as against 5.8% of GDP in Ireland, which is below the OECD average of  6.2%. But health spending is rising in Ireland and the  National Competitiveness Council  says that since 2001 Ireland has had the fastest rate of inflation in health insurance costs of 17 Euro area countries.

    These contrasts make it harder to devise a common policy for the Euro area

    These contrasts between countries make it harder to devise a common economic policy, even for the countries who share the euro as their currency. They lie behind some of the arguments about immigration in the European Union and the accusations of “welfare tourism”. These accusations are mostly wrong

    For example, a recent study in Germany showed that the average immigrant to that country pays 3,300 Euros more in taxes and social contributions than he/she takes out in benefits. In fact immigration yields a 22 billion euro surplus to the German taxpayer. Yet 66% of Germans believe immigrants are a burden! The same applies to the UK.

    In countries where government spending goes to the well off, one can expect well placed interest groups to be particularly effective in resisting changes or reductions in expenditure.

    Another conflict of interest will be between households with high debts, who are finding it hard to meet their obligations, and households who have made significant savings over the years and who wish to protect the value of those savings. Household debt, as a percentage of household disposable income, is 326% in Denmark, 288% in the Netherlands and 230% in Ireland as against 58% in Poland, 90% in Austria and 94% in Germany.

    For example, a policy that favoured low interest rates and inflation would benefit the debtors, but hurt the savers. The savers would also have an interest in protecting the value of the bonds issued by banks, companies and governments in which their pension and insurance funds are invested. Debtors, on the other hand, would be more relaxed about “burning “ these bondholders.

    These genuine differences of interest need to be brought out into the open because there are reasonable concerns on both sides of the argument.

    John Bruton Economy EU Member States Social Policy

    John Bruton

    Who benefits from government social spending?

    Blog

    08 Dec 2014

  • David Cameron has staked much of his credibility as prime minister and leader of the British Conservative Party on a quixotic crusade to achieve ‘reform’ of the European Union.

    Under pressure from a surging UKIP and the increasingly vocal eurosceptic wing of his own party, Cameron has repeatedly staked out a position supporting British membership of a reformed Europe. On 10 November, speaking at the Confederation of British Industry Conference, Cameron declared that the EU ‘isn’t working properly for us at the moment. That is why we need to make changes’.

    Having promised EU reform, Cameron must deliver. Failure to do so will significantly weaken his already tenuous position. And yet, success seems unlikely. A sizeable number of his internal opponents are already preparing for a push against his leadership or defection to UKIP.

    Rather than picking winnable reform issues, Cameron’s issues of choice are unlikely to produce success: he has attacked the principle of the free movement of people and roundly criticised the single currency. It is notable that these two issues are central to UKIP’s political narrative. As with his campaign against Juncker’s Commission Presidency over the summer, Cameron appears to have gambled his reputation on yet another unwinnable fight.

    Failure to achieve a win on EU reform will likely force Cameron to back a UK exit from the EU, any other position would be hugely inconsistent with current rhetoric. The split on the European issue that this would, almost certainly, incite within the Conservative party ranks would all but destroy Cameron’s chances of re-election. The signs of such a potential rift are already apparent with public rifts between MEPs Sajjad Karim and Daniel Hannan as well as between Conservative elder statesmen former Prime Minister John Major and former Treasury Secretary Ken Clarke MP. In such a context it is hard to see UK voters choosing to remain in the EU if given the choice by plebiscite. The short sightedness of the British Conservative party could well ruin their re-election chances and force a UK exit of the EU.

    With every successive electoral victory, UKIP’s advocacy of leaving the EU gains significant momentum in the UK, a country that has always had a somewhat ambivalent attitude towards its continental neighbours. And it is becoming increasingly hard to differentiate this position from that advocated by some members of the Conservative backbenches and its delegation to the European Parliament. This makes Cameron’s promises of reform all the more pertinent. It is advocacy of continued membership in a reformed EU that differentiates the Conservative position from that of UKIP and which, at least partly, keeps the party together on the issue of Europe which has so often divided their ranks.

    Again and again, European leaders have ruled out compromise on the issue of ‘free movement’. Barroso, Juncker and Merkel have been vociferous in ruling out granting UK exceptions on one of the European common market’s fundamental four freedoms. Cameron’s resolute stand on this issue flies in the face of all empiric evidence. A recent University College London study showed that Britain directly benefited from EU immigration to the tune of €6.25 billion net. British Defence Secretary and Conservative MP, Michael Fallon has said that British towns are ‘swamped’ and ‘feel under siege’ from ‘large numbers of migrant workers’. Migration from EU states to Britain may be rising but is far outstripped by non-EU immigration, particularly from countries once colonised by the vast British Empire. At the same time, UK migration to other EU countries almost perfectly equates to the number of EU citizens in the UK. Neither Cameron nor UKIP are keen to speak about what will happen to them if their anti-EU immigration crusade bears fruit.

    By continuing to conflate issues of EU and non-EU immigration and blaming resultant, exaggerated, issues on the EU rather than Britain’s own colonial past, they are essentially pandering to UKIP’s narrative and the xenophobic element of British society that it has ignited. This strategy serves to polarise British society, divide the Conservative party and hands the political initiative to UKIP. Without a change in approach, Cameron is gifting UKIP with electoral success as seen in Heywood & Middleton and now in Rochester & Strood.

    Lacking a degree of cohesion in their argument, Cameron’s position is that the UK should be part of the single market but does not want any of political addendums. However, the ‘free movement of people’, thereby the free movement of labour, is a fundamental aspect of the single market. From the very beginning this principle has been a central goal of the European communities. There is virtually no chance that Cameron can win this fight. Yet, he shows no sign of backing off.

    On his critique of the Eurozone, the UK has already achieved an effective exemption from joining the single currency. Whereas members of the EU are technically obligated to strive towards joining the single currency, the UK has been allowed pursue a different path without interference from its fellow member states. It is hard to see a UK government being able to push significant reform on a currency union it has so proudly kept out of. Out of its own choice, it simply does not have a voice at the table.

    Cameron’s reactionary tactics in response to the surge in UKIP support are dangerous, for his own leadership, for Britain and for Europe. His chosen fights are unwinnable. Rather than targeting achievable reforms, Cameron is publicly working at undermining central tenets of European unity which will not be acceptable to other member states. He is destined to lose these fights, alienating his own electoral base and potential allies in Europe, and thereby hand a victory to UKIP who will use Cameron’s failure on reform as proof of their mantra that the EU is unreformable and that the UK would be better off out.

    Eoin O’Driscoll EU Member States Euroscepticism Immigration

    Eoin O’Driscoll

    Cruising for a bruising: Cameron’s European dilemma

    Blog

    27 Nov 2014

  • Marcin Piatkowski is a Senior Economist at the World Bank in Warsaw specializing in central Europe. He speaks about the historically unprecedented success of Central Europe in the last 25 years, especially that of Poland, argues for the need to adopt a new growth model called “The Warsaw Consensus” and offers insights on introducing the Euro in Poland and the surrounding region.

    What are the prospects for central European economies? 

    In general, the new EU member states in central Europe have performed extremely well during the last 20 years. They have grown much faster than their western European counterparts. Poland, Slovakia and Estonia have developed much faster than most emerging markets. Poland, the most successful economy in Europe over the last quarter of a century, has grown even faster than the so-called Asian Tigers such as Singapore or Korea.

    As a result of this historically unprecedented growth—central Europe has never grown so fast in the past—the average income across the region increased from about forty per cent of the average western European level twenty years ago to around sixty per cent now. Countries like Poland, Slovakia and Estonia have shortened the distance to the West to an extent never experienced before.

    Quality of life is even higher than suggested by the level of income, as reflected in the relatively high life expectancy, easy access to modern technology and low levels of crime. In terms of technology, the region has even leapfrogged the West. For instance, in Poland there are more touchless credit cards users than in Germany. In most of Central Europe, citizens have never had life so good. Poland, Estonia and Slovakia have entered their new golden ages.

    However, while prospects for continued growth and catching up are generally positive (according to the IMF, Poland, for instance, is projected to grow more than twice as fast as Germany at least until 2019) past performance cannot guarantee future success.

    What reforms and policies are required in central Europe?

    Central Europe will have to continually readjust its growth model to continue to catch up. Given the inherent economic potential, most of central Europe should be growing at four per cent or more a year rather than the current two or three per cent. The speed of growth will decide whether central Europe will catch up with western Europe within a single generation or if it will take much longer. In the worst case scenario, the convergence process could stop altogether.

    Central Europe needs to base its growth on a re-adjusted economic model which I call ‘The Warsaw Consensus’. It is based on ten policy pillars including inter alia domestic savings; high employment; labour markets open to immigration; strict supervision of the banking sector and a new focus on well-being rather than only GDP. Among other policies, central Europe has to continue to focus on employment, education, and innovation.

    First, central Europe needs to substantially raise the employment rate: today only two out of three people work, while in the West it is three out of four. Raising the employment rate to the western European level would help accelerate growth; reduce inequality and improve the long term fiscal situation. Labour markets have to offer jobs to every one capable of working. 

    Second, the quality of education needs to increase further. While many countries in the region have achieved a remarkable improvement in primary and secondary education, the quality of tertiary education still leaves scope for improvement. There are no central European universities that belong to the global elite. This needs to change if the region wants to start to compete with the best global minds.

    Finally, central Europe needs to enhance innovation. This is a significant challenge, as technological innovation has never been a strong part of the region’s DNA. There are only few examples of global innovations developed by central Europeans, however, most of them have not been commercialised, as in the case of Copernicus or Marie Curie-Sklodowska. Central Europe, now, has possibly the last chance to use another fifteen billion euro of EU funds available to support innovation until 2020 to adjust its economic DNA to move from imitation to innovation. From quantity to quality. From importing to exporting ideas.

    How will the ageing population affect future economic development? 

    The challenge is that we may grow old before we grow rich. That being said, increasing life expectancy is the best outcome we could desire because the ultimate goal of economic growth is to allow us to live longer and healthier lives not the other way around. However, when talking about demographic changes we are missing one very important variable which tends to be pushed aside: immigration. The fertility rate across the whole region is low, below 1.5 children per woman. We would need a fertility rate of 2.1 for the generations to simply replicate themselves. We thus need to enhance our pro-family policies to make sure that the fertility rate increases.

    However, due to cultural changes and a new family model, I am convinced that pro-family policies alone will not be sufficient to achieve the replacement fertility rate. Germany, which spends over ten times more on pro-family policies than Poland, has a similarly low fertility rate. More money will not solve the problem. It will thus be inevitable to fill the demographic gap by opening up to immigration. Central Europe should invite young people from all around the world to fill the increasing gaps in labor supply.

    This could start from eastern Europe, whose citizens could integrate into our labor markets and societies with relative ease. The same passion with which we attract foreign direct investment, FDI, we should also deploy to attract foreign human investment: FHI.  Highly-educated, young, entrepreneurial and energetic people should be our targets. An optimal way to attract young immigrants would be to open central European universities to foreign students.

    Why Poland seems to be now more successful than other countries in the region? 

    It is likely due to a couple of factors. Poland, unlike all the other countries in the region, is a large economy, representing 40 per cent of the region’s GDP. It’s more than twice as big as the Czech Republic and three times as big as Hungary. Such a large economy has allowed Poland to base its growth largely on domestic rather than external demand, insulating the economy from external shocks.

    Second, Poland started from a much lower income level. Back in 1989, it was one of the poorest countries in the region, behind Hungary or the then Czechoslovakia. It’s easier to grow when you start low, as in seen also with China.

    Third, Poland witnessed a truly historical expansion of tertiary education. In 1989, Poland had 400,000 students. Today it has 1,600,000 students. Almost sixty per cent of young Poles are now taught at a university level. The quality of education is close to the European average. Poland has also done a lot to improve primary and secondary education.

    When you look at the OECD Pisa study that looks at the quality of education of 15 year olds around the world, Poland is doing extremely well: Polish 15 year olds are better educated that most of western Europe and the US even though Poland spends less than half on a student than in the West. If I were to exaggerate a little bit, I would say that Poland is producing geniuses on the cheap.

    Finally, from the very beginning Poland was lucky with the quality of its economic policy makers, who were competent, committed and honest. They also knew where they were going: towards Europe and joining the EU. They knew that Poland needed to become more open, more liberal, more entrepreneurial and more Western. Throughout the last 25 years there was an implicit consensus among all the parties both in power and in the opposition that Poland needed to become “European” again. And it has worked well.

    Were you never challenged by Euroscepticism as seen in Hungary or the Czech Republic?

    Poles are quite supportive of the EU. 80 percent of Poles support the EU. They have seen the benefits of EU accession and how the European convergence machine continues to work, taking in poor countries and making them rich. They have become the most European among all the Europeans. Had it not been for the institutions, values, norms and funds that Poland has received from the EU in the last twenty five years, it would have never achieved such remarkable success and never entered its new Golden Age. Poles are supportive of the EU also for geopolitical reasons.

    Do you still believe in the big bang introduction of Euro as you wrote in an article for the Financial Times in 2008?

    What I meant in this article was that at that time there was an opportunity to introduce the Euro to more countries on the condition of strengthened fiscal rules. I also argued that the exchange rate criterion for euro zone entry, i.e. the ERM II mechanism that requires countries to keep their currencies within a  +/-15% band relative to the Euro, could be a challenge, especially for countries with floating exchange rates such as Poland.  This is because entering ERM II would expose them to potentially destabilizing currency attacks.

    The vast fluctuations of the Euro itself against the dollar show how hard it is to keep the exchange rate stable in the context of globalized currency markets driven by portfolio flows. The risks are particularly high for the Polish Zloty, which is the most liquid currency in Central Europe and a currency of choice for global speculators. Successful passage through ERM II would then require very careful planning and strong support of the ECB. 

    But do you still think that the best way is: “Euro as soon as possible”?

    The introduction of the Euro cannot take place overnight but it is still the way to go. The euro would help to further enhance macroeconomic stability in the region, expand trade and increase private investment. It would thus help accelerate growth and allow Poland to catch up with the West faster, the current situation in the Eurozone notwithstanding. Central European countries that have already adopted the euro are on the whole doing well.

    However, before entering the euro zone, countries like Poland first need to do their homework. This includes sustainably reducing budgets deficits to below 3 per cent, keeping public and private debts in check and reforming the economy so that its competitiveness is increasingly based on quality rather than quantity. Fewer potato chips, more micro-chips.

    Interview by Vladka Vojtiskova. The interview presents personal views only. 

    Dr. Marcin Piatkowski was a speaker during the fifth annual Economic Ideas Forum that took place in Bratislava on 16-17 october 2014. He is a Senior Economist at the World Bank in Warsaw, former Chief Economist of PKO BP, the largest bank in Poland, economist in the European Department and Advisor to Executive Director at the International Monetary Fund in Washington D.C. He is an Assistant Professor of Economics at Kozminski University in Warsaw. He also served as Advisor to Poland’s Deputy Premier and Minister of Finance. He has recently published papers on “Poland’s New Golden Age: Shifting from Europe’s Periphery to Its Centre” and on “The Warsaw Consensus: The New European Growth Model” He tweets using @mmpiatkowski and can be reached at mpiatkowski@worldbank.org

    Economy EU Member States Eurozone Growth Macroeconomics

    Central Europe: move from imitating the West to innovating!

    Other News

    19 Nov 2014

  • After the Second World War it became clear that several European countries had failed to meet their defence tasks in the years before this war unfolded. In the Netherlands a broad consensus emerged that it was necessary to increase the level of defence spending. In the beginning of the fifties the share of defence in terms of GDP raised from around 4% to almost 5% GDP. However, in the late 1950s this share dropped to 3% GDP. In the thirty years of the Cold War the relative share of defence remained stable around the 3% GDP. After the fall of the Berlin Wall this share dropped sharply. Nowadays, Dutch defence expenditure is scarcely more than 1% GDP (1.1% GDP in 2013).

    As a consequence Dutch defence is weak, and it remains to be seen whether we can contribute significantly to the necessary fight against the Islamic State (IS) or deliver a reasonable share for a new fast NATO force protecting the eastern border of Europe. And there is no room for other challenges that might occur in the (near) future.

    However, except the USA, the Dutch situation of decreasing defence expenditures since the war is no exception. In figure 1 the share of defence expenditure as a percentage of GDP is shown for several NATO states as the Netherlands, Belgium, Germany, Austria, France, USA and UK.

    Figure 1: Defence Expenditure level (% GDP) in NATO countries

    It should be noticed that the defence expenditure share of Germany, Belgium and Spain are somewhat lower than the Netherlands. But also the level of France and UK, which have been important defence powers, have been decreased significantly. Nevertheless, both countries can still meet the NATO obligation to spend at least 2% GDP on defence. However, this is not case for the Netherlands (and Belgium, Germany and Spain also). For the USA the large shares of Korean-war (13%) and the Cold-War (6%) are already history.  Due to the war against terrorism the shares have been raised at the beginning of the 21st century.

    Nevertheless, the Obama administration changed this policy and the level declined again, though remains well above the NATO norm. Recently, Obama delicately points out the imbalance within NATO. He stressed that Europe should do more to acquire its own safety guarantee. This also in the knowledge that many countries in Europe have further reduced their defence expenditures since the euro crisis.

    In the Netherlands, recently, a policy change has been made. In 2015 the defence budget will raise with 100 million euro. However, this is hardly more than the estimated GDP increase of the current expenditure level, so that the Dutch share at most slightly increases. This is of course not sufficient at all. Therefore, I would suggest a clear budget norm for defence for the coming years not only for the Netherlands but for other EU countries as well. Also because the danger is considerable that when the current tension in the world will decrease or there will be a new budgetary crisis our territory protection will be placed at the bottom of the priority list again.

    In my view, the trend rate of the defence spending should exceed GDP growth significantly because only on this condition the Netherlands (and others) will meet the NATO standard of 2% of GDP in due term.  If we really want to give priority to international peace and security, a significant impulse towards defence is necessary and also a clear budget norm to achieve it.
    ________________________

    1. Data have been given since the moment that countries have joined NATO (see Military Expenditure Database van Stockholm International Peace Research Institute http://www.sipri.org/research/armaments/milex/milex_database)

    Raymond H.J.M Gradus Defence EU Member States Security

    Raymond H.J.M Gradus

    Defence spending: A clear budget norm is necessary

    Blog

    14 Nov 2014

  • The European Union is a union of sovereign states, who are sovereign in that they are entirely free to leave the EU. This freedom to leave means that the EU is not a “super state”. There is no coercive force, no EU army, to force Britain or any other country to remain in the EU. Britain enjoys a freedom, within the EU, that colonies did not enjoy within the British or other European Empires.

    Britain is thus entirely within its rights in considering the option of leaving the EU, although that does not mean that such a course would be wise.

    The EU does not exist on the basis of coercion. It exists on the basis of common rules, or Treaties, applicable to all, interpreted independently by the European Commission and the European Court of Justice,  that EU countries have so far  freely abided by, even when particular decisions were not  to their liking. If countries started systematically ignoring EU decisions, the EU would soon disappear.

    One set of particularly important set of EU rules are the ones that apply to budget deficits and debts of EU countries within the euro zone. These rules have been incorporated in EU Treaties and in Treaties between Euro area states. One of the provisions is that if a country has an excessive deficit, it must reduce that deficit by an amount equivalent to 0.5% of GDP each year until it gets its deficit below 3%.

    France and Italy, big states that were founder members of the EU, have both produced budgets for   2015 that do not comply with the rules. Previous commitment they gave to get their budget in line have not been kept. Initially the European Commission objected to their 2015 budgets, and both countries have adjusted their budgets a little.  But, even after these revisions, the budgets are still in breach of the EU rules.

    Some will argue that it is the rules that are at fault, not France and Italy. If inflation is negative,  debts increase in value, while prices are falling. Countries are then caught in a debt deflation trap of a kind that was not envisaged when the rules were drawn up.  But that is an argument for changing the rules, not an argument for ignoring them, or pretending they have been complied with when they have not been.

    Neither France nor Italy have taken the sort of steps that Ireland, Greece, Spain and Portugal have taken to bring their fiscal situation into line. Nor have they implemented structural reforms that would release growth potential , as Spain and Greece have done. Thanks to reforms it undertook under pressure, Greece is set to have one of the fastest growth rates in the EU in 2015 and 2016, along with Ireland. French and Italian laws have rigid protections for insiders in the job market, but leave a choice of temporary low paid contracts, or unemployment, for the rest of their people. Their administrative, legal, and tax systems need urgent reform.

    Obviously, the European Commission will try to be politically realistic with both countries, but a single currency cannot work for several countries unless there is either a single government, which we do not and will not have in the euro zone, or rules that are transparently and uniformly applied to all countries, big and small.

    Some would argue that the rules should be changed to take account of the problem of the debt trap caused by deflation, which is Italy’s problem (but not that of France). There is a good case for this. But changing the rules would require EU Treaty change, and nobody wants to change the Treaties, because a Treaty change would have to be unanimously agreed among all 28 EU states.

    Other states fear that proposing any Treaty change now  would be an opportunity for Britain to use the lever of blocking  a Treaty change unless British demands for
                   – a restriction of free movement of people within the EU, 
                   – vetoes for a minority of national parliaments on EU legislation and
                   – the  scrapping the goal of “ever closer union” within the EU,
    are conceded.

    This is a form of blackmail, but it has happened before in EU affairs. But British domestic politics should not be allowed to prevent Treaty reform for the euro zone, of which Britain is not even a member!

    If the EU is unable to change its Treaties, because of blockages like this, the EU will eventually die. A state would cease to work if it cannot change its constitution. It is the same with the EU. Necessary EU Treaty change cannot be dodged indefinitely.

    In a recent commentary, Daniel Gros of the Centre for European Policy Studies has criticised the European Commission of Jean Claude Juncker for failing so far to either

            a. Insist that France and Italy stick by the existing fiscal rules or, if not

            b. Call for a revision of the rules to take account of the exceptional deflationary conditions that exist

    He  is right .

    John Bruton Economy EU Member States Macroeconomics

    John Bruton

    The EU is a union of rules, not a union of force

    Blog

    08 Nov 2014

  • The spa city of Carlsbad (Karlovy Vary) in Western Bohemia, counting 50 000 inhabitants. You might be surprised by sign posts written in Cyrillic alphabet and daily flights to several Russian cities. All this is thanks to the large Russian minority that came here in the 90s.

    When the European Council was deciding on another round of Russian sanctions at the end of August, three Central European countries – Czech Republic, Slovakia and Hungary – showed reluctance to agree to the measures. For some, this might be surprising, taking into account the Soviet occupation of those countries. However, the communist period is paradoxically one of the reasons why Russians are still so influential in this region thanks to their links which I’ll show with the example of the Czech Republic. Poland is an outlier in this regard with a foreign policy marked by intense wariness in its relationship to Russia. This can probably be ascribed to Poland’s bad historical experiences with Russia during the partitions of Poland and World War II including the Katyn massacre).

    DEPENDENCE ON RUSSIAN GAS

    It is well known that much of central Europe is highly dependent on Russia for their energy supplies, there is no need to go into detail. The following figures tell all: Hungary and Slovakia are about 80 % dependent on Russian gas, Czech Republic about 57 %. However, although statistics suggest that the Czech Republic is less dependent than Hungary and Slovakia and it has an advantage in the possibility of gas reverse flow from Germany, there is a more interesting and less known fact: the Czech Republic is the first EU country where the major Russian energy company Gazprom started directly selling gas through a company called Vemex headed by Russian businessman Vladimir Ermakov nicknamed ‘Czech Mr Gazprom’. Vemex controls 20 % of the Czech gas market and has already expanded to Slovakia. Over 50 % of its shares belong to Gazprom Germania, a subsidiary of Gazprom and another 33 % of shares belong to Centrex Europe Energy & Gas AG which is believed to be a Gazprom front company.

    Apart from gas Russian influence is also apparent in the Czech nuclear sector. Both Czech nuclear plants Temelín and Dukovany were built by Soviet construction plans (Temelín has a Westinghouse control system from the 90s though). When, in the past few years, the biggest Czech energy company, the state-owned ČEZ opened a debate about building another two blocks in Temelín, a Czech-Russian consortium MIR.1200 was the leading construction candidate in the competition against French Areva and American Westinghouse. The consortium consists of Russian companies Gidropress and Atomstrojexport and a Czech company Škoda JS/Škoda Steel. However, this Czech company is actually also in Russian hands – it was bought by a Russian company OMZ aka United Heavy Machinery. And who owns OMZ? Gazprom again…

    RUSSIAN INFLUENCE THROUGH BUSINESS

    There are also other Russian key players in the Czech energy sector – Russian oil company Lukoil Aviation Czech gave a major donation to the political campaign of the current Czech president Miloš Zeman. Lukoil Head of Office Martin Nejedlý is now working as a Presidential advisor. Also Zeman’s former collaborator Miroslav Šlouf worked as a lobbyist for Lukoil. Is it then so surprising that the Czech president seems quite fond of Russia?

    He showed his kindness to Moscow at a conference called Dialog of civilizations that was organized this September on the Greek island Rhodos by Russian oligarch Vladimir Jakunin, head of the state-owned Russian railways and a close associate of Putin who features on the US black list. At this conference Zeman compared the Ukrainian conflict to ‘something like a flu‘ and pleaded against the sanctions.

    Gazprom and Lukoil are big names but there are also many smaller Russian companies. Russians own over 17 000 companies in the Czech republic which puts them on the top of foreign investors in terms of the number of companies (in terms of capital the Germans and Dutch are bigger investors). The problem of Russian companies is that they are sometimes used to peddle Russian influence in local administration and for espionage, as stated by the Czech secret service (BIS) report. The 2013 report moreover warns that those spies are supported  by official Russian diplomatic services and also warns against infiltration of Czech media by pro-Russian journalists.

    Russian companies are often non-transparent and some of them fail to conform to legal standards (for instance they often do not file yearly balance lists). One example of such a‘sleeping company‘  was company Albion CZ that belonged to Alexander Babakov, member of the Russian Duma and one of Putin’s men who figures on the EU black list. He recently liquidated this company, however, there are other companies that haven’t been dissolved yet (that do not fulfill their legal obligations.These companies should be automatically dissolved by Czech courts.

    CULTURAL TIES…

    Russians still profit from their ties established during the Communist regime. Many former Czech communist apparatchiks secured themselves influential posts in various companies and institutions thanks to their contacts and language abilities that ordinary people who could not travel easily during the communist era often lacked. There was (and still is) a lustration law that limited the access of high communist functionaries and communist secret service co