With flashes of wit, much earnestness and a certain reluctance to go for the jugular of their opponents, four candidates for the European Commission presidency broke new ground on Monday night by holding a live televised debate designed to drum up public interest in the May 22-25 elections for the European parliament.
If social media are one measure of that interest, the debate may have worked. Halfway through the 90-minute programme, broadcast from the Dutch city of Maastricht, an organiser announced that 10,000 tweets a minute were coming in. The harder question to answer is whether any candidate did enough to convince potential voters that the elections will truly make a difference in a EU blighted by a long recession, mass unemployment and a squeezed welfare state.
Although the debate never turned nasty, Ska Keller, the Greens candidate, got in a sharp jab at Jean-Claude Juncker, the centre-right candidate, when she accused him of “presiding over a tax haven” during his time as prime minister of Luxembourg. An indignant Mr Juncker rejected the charge and managed later to slip in the image-softening remark that one reason why he favoured a EU-wide minimum wage was that he remembered his father’s tough life as a steelworker.
Guy Verhofstadt, a former Belgian prime minister who is the centrist, liberal candidate, turned his fire on José Manuel Barroso, the outgoing Commission president, saying Mr Barroso had never taken a decision without first flying to Berlin and Paris to get the green light. “The Commission needs to lead,” he thundered.
He also put Mr Juncker on the spot by challenging him to explain why his centre-right group still included Silvio Berlusconi, the former Italian prime minister, who caused outrage last weekend by suggesting Germans denied the existence of Nazi concentration camps. But Mr Juncker hit back with the succinct sentence: “I was sickened by the statements of Mr Berlusconi.” Read more
For better or worse, my time is up as Brussels bureau chief for the Financial Times, so this is my last post on this blog. My successor, Peter Spiegel, will arrive in September. I wish him, and all the readers and contributors to the Brussels Blog, the very best.
Leaving Brussels after three years feels rather like exiting an intensely gripping drama at the end of Act III instead of staying to the end. The fate of Polonius in Hamlet comes to mind. What was his sententious advice to his son? ”Neither a borrower nor a lender be/ For loan oft loses both itself and friend/ And borrowing dulls the edge of husbandry.” Now there’s something for Angela Merkel and George Papandreou to chew on.
In Brussels there are days when you feel the European Union is a magnificent creation, one of the most inspired experiments in mankind’s history. Then there are days when you feel disgusted by the pettiness, the short-sightedness, the incoherence of it all. As followers of this blog will know, I count myself a European in heart and soul and I desperately want the EU to succeed. Read more
Reforming the management of economic policy, primarily in the eurozone but also in the European Union as a whole, is without question one of Europe’s highest priorities. Few steps would do more to raise the EU’s credibility with the US, China and the rest of the world than concerted action to improve European economic performance and make the euro area function more efficiently as a unit. Much of this comes under the heading of “economic governance”. But the difficulty is that it is not always easy to figure out which Europeans are in charge of the process.
On Monday Herman Van Rompuy, the EU’s full-time president, chaired the latest meeting of a task force on economic governance that he was chosen last March to lead. The task force, consisting largely of EU finance ministers, came up with various sensible ideas on tightening sanctions (financial and non-financial) on countries that break European fiscal rules. Task force members also want to strengthen the monitoring of macroeconomic imbalances, such as the gap between large current account surpluses in Germany and deficits in southern Europe. Read more
Raising the retirement age and cutting back pension entitlements are possibly the most unpopular measures that any modern European government can take for the purpose of stabilising the public finances. From an individual’s point of view, the advantages seem remote or non-existent and the disadvantages all too immediate. From the point of view of a ruling political party seeking re-election, it’s much the same story. This explains why there is growing interest among European Union policymakers in the idea of “de-politicising” the pensions issue, by making certain changes to pension systems automatic and not subject to endless, acrimonious political struggles.
Take a Green Paper published today by the European Commission. A Green Paper is a document designed to stimulate public discussion, not make firm policy proposals, so the Commission steers a cautious path through the issues. Nonetheless, it observes in one passage: “A number of member-states have demonstrated that a promising policy option for strengthening the sustainability of pension systems is an automatic adjustment that increases the pensionable age in line with future gains in life expectancy.” Read more
Financial commentators, like financial markets, move in herds. Is the herd wrong about Greece?
The herd takes the view that Greece will sooner or later have to restructure its debt. According to herd thinking, the €110bn rescue plan arranged for Greece by its eurozone partners and the International Monetary Fund merely buys some time for the Greek government – and for its European bank creditors. The herd predicts a “haircut”, or loss, for Greek bondholders of 30 to 50 per cent of the face value of their bonds. All this is likely to happen towards the end of 2011 or in early 2012, says the herd. Read more
Since the start of this year, Europe’s financial crisis has been given many labels - a sovereign debt crisis, a banking sector crisis, a crisis of the euro itself. But rarely is it asked whether the European Union’s single market, which is the foundation stone of EU integration in the modern era, is under serious threat.
One person who has asked this question is Mario Monti, the distinguished former EU commissioner for the internal market and competition policy. In May he presented a report on how to reinvigorate the single market to Commission president José Manuel Barroso, who had commissioned it from him last year. It delivered a blunt message. Many Europeans – citizens as well as political leaders – looked at the single market with “suspicion, fear and sometimes open hostility”, Monti said. “The single market today is less popular than ever, while Europe needs it more than ever.” Read more
Turkey’s bid to join the European Union is expected to make a little progress today. I stress “a little”. In most respects, the cause of Turkish membership of the EU is in worse shape than at any time since EU governments recognised Turkey as an official candidate in 2004.
The progress, minimal though it is, takes the form of an agreement by the EU and Turkey to open formal talks on food security. This is one of the 35 chapters, or policy areas, that a country must complete before it can join the EU. It means that Turkey will have opened 13 chapters in total. Of these, however, only one chapter has been closed. If this is progress, the snail is king of the race track. Read more
The euro has fallen by almost 20 per cent against the dollar since last November, and the general view in Europe is that this is good news – indeed, one of the few pieces of good economic news to have come Europe’s way recently. The argument goes as follows: euro weakness = more European exports = higher European economic growth.
Unfortunately, the real world is not as simple as that. Inside the 16-nation eurozone, not every country benefits equally from the euro’s decline on foreign exchange markets. As Carsten Brzeski of ING bank explains, what matters is not so much bilateral exchange rates as real effective exchange rates. These take into account relative price developments and trade patterns, and their message for the eurozone is far from reassuring. Read more
After spending three days in Reykjavik and the northern town of Akureyri, just below the Arctic Circle, I am starting to get the feeling that Iceland’s entry into the European Union is anything but guaranteed. I have met government ministers and officials who are eager to steer their country into the EU. But I have met a fairly wide range of private sector businessmen, teachers, students and other Icelanders who are either flatly opposed or at best non-committed.
The most passionate opposition I’ve encountered has come from representatives of the powerful fisheries industry and the less powerful but politically influential agricultural lobby. Here’s what the manager of the national dairy farmers’ association said: “If we entered the EU, our tariffs would have to go. Our home market share would drop by 25 to 50 per cent. The number of farmers would drop by 60 to 70 per cent. EU membership would deal us a tremendous blow, there’s no doubt about it.” Read more
Will Iceland really join the European Union? I have come to Reykjavik in search of answers. In one sense, it’s the right time to be here: the skies are white for almost 24 hours a day at this time of year, appearing to throw light on everything. But in another sense this promises to be a frustrating trip - Iceland itself doesn’t seem to know if it wants to be in the EU or not.
The opinion polls are not good. After a long period in which a solid majority of about 60 per cent of Icelanders supported EU membership, things have turned upside down in recent months. Support for EU entry was estimated to be as low as 28 per cent in one recent survey, whilst opposition now runs at about 60 per cent. If Iceland is serious about joining the EU, it will have to hold a referendum, so these numbers matter. Right now, however, we are a long way from a referendum – at least two years, and perhaps longer. Much can change.
Enthusiasm for the EU was high when Iceland’s banking system and currency collapsed in 2008, prompting the introduction of a drastic austerity programme conducted under the beady eye of the International Monetary Fund. But Iceland’s dispute with the UK and the Netherlands over how to repay British and Dutch savers who lost their money in Icesave, the failed online Icelandic bank, has changed public opinion. Read more
Peter Spiegel is the FT's Brussels bureau chief. He returned to the FT in August 2010 after spending five years covering foreign policy and national security issues from Washington for the Wall Street Journal and the Los Angeles Times, focusing on the wars in Iraq and Afghanistan. He first joined the FT in 1999 covering business regulation and corporate crime in its Washington bureau, before spending four years covering military affairs and the defence industry in London and Washington.
Alex Barker is EU correspondent, covering the single market, financial regulation and competition. He was formerly an FT political correspondent in the UK and joined the FT in 2005.
James Fontanella-Khan is FT's Brussels correspondent, covering media, telecom and internet regulation as well as justice, employment and social affairs and its impact on eastern Europe. He was formerly an FT correspondent in India. He joined the FT in 2006.