Energy and climate: Can it be simply rethinking mainstream growth strategies?

Posted by feps on 26/02/15
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This week could be a turning point for climate and energy policy in Europe. The Commissioner for Energy Union, Maros Sefcovic announced the strategy for Energy Union alongside a Climate communication from the European Commission on the ‘road to Paris’ and a Communication reporting on the electricity interconnection target of 10 percent.

According to the International Energy Agency, energy accounts for two thirds of global emissions so when we are talking about climate change, its effects and how to deal with this, energy policy is fundamental to these debates and inextricably linked. The announcements seem to put citizens first and aim to enhance solidarity in EU energy policy and incorporates the need for social dialogue, thereby ensuring a ‘Just Transition’. However the implementation of this will be the most difficult part. National Member States still show deep divisions on how we should go about renewing our energy policies. Yet it should not only be a question of security, which the crisis in Ukraine is currently highlighting but moreover on how not to harm our environment and the only planet we are living on and about how to build a sustainable future.

The fifth Intergovernmental Panel on Climate Change report published last year stating that humans are a cause of climate change was perhaps foreseen but nevertheless alarming. Yet the same report identified that the technology for a clean transition exists, but it needs to be harnessed.

The climate and energy decisions that Europe will make over the next 12 months, reform of the Emissions Trading Scheme for instance will shape how we use and generate energy for decades to come. They have huge implications for our fuel bills, the security of our energy supplies, our industrial opportunities, and global efforts to manage the risks posed by climate change. If our leaders take this emergency seriously, we can avoid being ‘locked-into’ fossil fuels for another several decades. Significant changes to the structure of some energy companies such as E.On illustrates their business awareness to move away from fossil fuels if they are to respect the climate agenda.

The reality is that we can do so much more in energy policy if we act together as Europeans. We have the political tools and a favourable geographical landscape to do so.  What is even more needed is a mutual commitment to climate change action and thus also to enhance our energy consumption and supply in line with sustainability in social and economic terms.

Last October, the EU Council decision on the EU 2030 climate and energy package, left many feeling very disappointed. Although the European Union is recognised for being a role-model on climate action, the emergence of new clean energy policies in the US and China and the bilateral agreement signed in November now means that an international climate change agreement is more likely to be reached at the UNFCCC summit in Paris this December. The EU has to step-up and show commitment to convince those leading countries that Copenhagen cannot be repeated.

The first priority for Energy Union needs to be energy efficiency. It is the fastest, cleanest and safest way to save energy. It’s a crucial way to meet our energy needs and has multiple benefits. Also a credible European energy strategy would encourage the continued growth of the renewables industry, given the potential for its proven, affordable clean technologies to generate new industrial opportunities and help reduce gas dependency.

The deep flaws in the Emissions Trading Scheme, Europe’s flagship scheme for cutting greenhouse gas emissions, require urgent reform. The Market Stability Reserve needs to take effect as soon as possible. It is perhaps unrealistic to say we need it be reformed before the UN climate summit in Paris this year but it is an issue that requires urgent action as the low carbon price is having a knock-on effect for other climate and energy issues.

Interconnection is also a vital part of renewing European cooperation and solidarity through linked energy supplies whilst lowering dependence on Russia and other third countries. Furthermore, investment is key to this. A discussion should be started for a ‘super-fund’ for energy investment.

At the moment, with funding spread out in separate budgets, its not easy to see the clear long-term investment set-out for our overall, long-term energy and climate goals. There are economic alternatives. The crisis proved this and FEPS, with many other progressive researchers have been publishing the findings on this and showing alternative policy solutions.

We need to seriously re-think our economic models and the way we think about ‘growth’. It should be clearly linked to our climate and environment with as the ‘circular economy’ or the ‘blue economy’ suggest. Europe’s industrial strategies need to not only have regards to ‘growth’ but to assess first how this impacts the environment.

Scientific research tells us that we have to change our approach concerning the way we produce and how we influence nature. The ‘anthropocene’  concept discussed in FEPS Queries magazine issue 5 is based on evidence that proves that human-driven impacts are now significant at the level of the Earth’s deep geological time (such as the changes in carbon and nitrogen cycles, global warming, sea level change etc.)

Without radical action to avoid a 4°c rise in global temperatures, more extreme heatwaves, declining global food stocks, loss of ecosystems and biodiversity, and life-threatening sea-level rises are likely.

Hopefully this week’s announcements will provide the turning point we urgently need towards a sustainable transition. COP 21 in December can be too if there is the political willingness to take urgent measures.

Greece: The blue in the sky seems far ahead

Posted by feps on 11/02/15
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The debate on Greece and how a solution can be found is causing more and more problems.

The public opinion in Northern Europe is influenced by the “pacta sunt servanda” approach, meaning Greece has to fulfil all commitments so far signed. In Southern Europe – especially in Portugal, but also in Spain – it is the “envy argument” brought forward in order not to give favour to Greece, which was not accorded to them. In Greece itself it is even more problematic. There is the “revenge argument” coming up. The Germans are imposing us now through reforms but they have still to suffer from their crimes committed during World War II. None of this is very helpful, neither for Greece nor for Europe.

Behind all this is the wrong approach on how to deal with the sovereign debt in Greece. Behind all this is how huge and urgent a problem it is for the Greek banks, especially after the ECB announcement that it would no longer accept Greek bonds as a guarantee. It is quite obvious and argued by many critical economists for a long time now that cutting the budget expenditure and coupling this with so called structural reforms (with the argument that the light in the tunnel will come in five or six years) brings this kind a dangerous situation which we are facing now. Greece is facing an even more serious shrinkage of the GDP, and in consequence much less fiscal revenue, which leads to the opposite of that what the austerity measures are supposed to realise: a huge increase in debt!

But it should also be clear that Greece is and was the most vulnerable of the Eurozone members. The country is the least effectively governed. It is not by accident that tax is not collected properly; those with large fortunes, including the Greek Orthodox Church, are evading tax payments; public investment is not admitted to the normal rules of serious competitiveness etc. These problems have nothing to do with Europe and the Euro. The newly elected prime minister Alexis Tsipras should avoid blaming and shaming Germany. A huge responsibility of the current situation is simply due to the interior Greek problems.

Nevertheless a solution is needed. Proposals are on the table and one of the most appropriate ones could be GDP indexed bonds as put forward by internationally renown economists as Joseph Stiglitz, Stephany Griffith Jones and Robert Shiller recently in the FT. Such bonds link interest payments to the growth rate of the Greek economy. This would NOT reduce the total value of the overall debt, so such bonds do not mean debt reduction. The GDP-bonds could allow Greece to have additional fiscal space for necessary spending in education, health care but also in public investment to create the needed growth for a new start of the Greek economy. For sure such a solution is controversial. But as even the The Economist of February 7th 2015 is writing, such a smart debt mechanism with the proposal to switch existing Greek debt for GDP-indexed bonds is promising. It is an already old idea whose time may at last have come! (The Economist, February 7th-13th, 2015, p. 64)

Even when the blue in the sky is far ahead now, cloudy weather could become at least in the mid-term a bit sunnier.

The Nordics: A point of reference for the European Union

Posted by feps on 16/11/14
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Last week, I was asked to discuss the potential lessons for the European Union from the Nordic Models at the Nordic Labour Movement congress SAMAK. For me, three points seem essential:

First: Freedom and prosperity needs to be created through opportunities and challenges!

Democracy, respect for human rights and rule of law remain guiding principles of the European Union. The mission has remained to promote them beyond the borders. This is why the subsequent enlargements have been so important, marking historical turning points from which onwards people in different states hope to lead lives enjoying freedom, dignity and prosperity. But what once has been a common desire now is rather taken for granted. Democracy seems to appear rather as a static arrangement that is there because it is agreed upon in treaties. It is not seen as an ideal that requires all to assume responsibility for its constant development. Therefore the populists have a space to promote a discourse of fear, they build upon disenchantment and despair. They grow stronger day-by-day, trashing democratic politics and actors involved. And they will, unless challenged properly, increase in numbers.

This is the most important lesson the European Union has to learn from the Nordics: More freedom is needed and it is not given. Everyone has to accept their duties but can demand their rights are respected. Respect and freedom are the basis for a fertile ground for progress and unity.

Second: Only equality of labour standards ensures long-term progress and social welfare!

The historical objective of the European integration process was to establish mechanisms of inter-state cooperation that would protect people from conflicts, poverty and hunger. While the traditions that underpin different post-war welfare systems may differ, the overall principles of equality and social justice have been common and hence allowed to speak in terms of an ideal of a European Social Model.

The vision of a Social Europe is to ensure that the common effort for the Union translates into an improvement of living and working conditions. It has always taken a lot of persistence to negotiate compromises, especially when the strategies for social transformation take a long time to show results. So when they finally reach that stage, the benefits of them are often already taken for granted.

This is also one of the reasons, why some of the welfare arrangements have evolved to be old-fashioned, not really sticking to our changing society. However, while the crisis hit, conservatives have made no differentiation and social provisions in general have become the first target of austerity.

The social objectives must translate into both labour and social policies. However austerity policies in many Eurozone countries have significantly impaired the possibility to put forward a new framework on progressive labour and social policies. The recent years have seen detachment of the debate on these even within the progressive movement.

Furthermore, European added value must not be mistaken for competing on the national level at any cost. An essential is the European labour standards. There is no trade off between efficiency and equality.

Progressives must reopen the debate and embark on the struggle for quality employment for all. This is especially essential now, when they are working for proposals for a re-industrialisation strategy. Here we encounter one of the main lessons from the Nordics for the European Union to consider. The European Union has to continue to fight for equal labour standards and better income in all European member states. The Nordics have been strong in ensuring common standards based on respect but also based on strong and effective democratic institutions.

 

Third: Globalisation gives us the duty to re-define economic thinking!

Globalisation and its new challenges demand a redefinition of fiscal, monetary and global economic policy. Here both the Nordics and the European Union need to learn.

Fiscal and monetary policy should be seen as having the fundamental function of ensuring high-levels of aggregate demand. In addition and to fight against inequalities there is an essential need for a common European labour policy and a shift away from the current system of wage repression amongst the member states and amongst the different economic zones elsewhere.

A common international labour policy and a progressive harmonisation of labour rights and social protection could lead to a reasonably egalitarian income distribution and to an end to the current dysfunctional framework.

Modern global capitalism cannot remain an uncontrolled “wild” engine. Achieving significant increases in employment, growth and reducing inequality in Europe will not be easy, but it is certainly achievable. It will imply the implementation of a range of progressive economic policies at both the country levels and the EU level. These imply that the European Union will have to become more coordinated and more progress could only be achieved through international cooperation.

In this regard, a strong and active Union with an agenda of regulated international trade based on decent work for all is to be advanced. New protectionism and fear are not the answers. But this demands a creation of a strong moral and political legitimacy for economic and labour market policy as well as for new trade arrangements such as TTIP. It should become a model for such a new approach in international treaties and an answer to modern globalisation and capitalism.

When the Nordics are looking for a more human approach in the globalised world this should be done together with other Europeans and not separately. The Nordics are part of Europe and our continent will only remain strong when united. The challenges of our century are immense. Climate change, rising inequalities, technological advances, rising of new global powers, only to name the most challenging one.

European integration remains the only solid and serious alternative to tackle this. The nineteenth century created the labour movements as an answer to industrialisation. The twentieth century created the European Union as an answer to war and self-destruction in Europe. We should now create an answer to a human globalisation. All the lessons learnt need to be incorporated in order to ensure a better and a more prosperous Europe.

 

 

France and the European Union: there is no “exception française”

Posted by feps on 18/09/14
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The French Prime Minister Manuel Valls gave a speech this week on the general policies to implement in the country to overcome the crisis and to implement an economic policy in order to foster growth and reduce the high unemployment rate in France. The content of the speech was submitted to a confident vote in the French parliament. The prime minister got the necessary majority.

There was a very striking paragraph in his speech, which needs to be addressed. The prime minister said, “it is France and France alone that decides what the country has to do”. And he stipulated that there should be a serious talk with Germany, which has to assume its responsibilities for Europe.

For sure, it is the responsibility of each government to implement its political choices. But, France is an entire part of the European Union. This means France is as committed to the treaties as all other members of the Union. Being a member of the monetary union means also that there are mutual responsibilities and dependencies to respect. Europe is still in a deep economic and social crisis and especially within the Eurozone the utmost has to be done to sort out of the crisis and to generate growth and employment.

France, like Germany, has to not only exploit the opportunities of the Monetary Union but also to implement policies that respect the various regulations. The members of the euro area have to work together in a mutual way of respective understanding. If the current government in France is accusing in a more or less brutal way its other partners this is not helpful. The French government is as responsible as the German or Italian government for what is going on. The Union is shaped in the way that requires common responsibility. It makes no sense to accuse one government. It is necessary to work together, implement policies on the national level as well as on the European level on the basis of the method often described as the European communitarian approach.

Referring to the national approach helps right wing populists and challenges what has been so far achieved in Europe. What we need is not a roll-back on national policies but to look forward on common European policies. It is not one country that is responsible for the problems of another member state of the European Union. It is the common European responsibility of each and every member state. One can only subscribe to agree on the “visible hand of the state” but this visible hand is in Europe so far “the visible hand of the Union”.

New mechanisms of coordination have been implemented since the crisis emerged.  Their good functioning cannot be taken for granted. The European Semester has become the established framework for the coordination of economic, social and growth policies. It is within this framework that France should look to tackle its problems of unemployment, sluggish growth and growing inequalities. Overcoming the crisis is not a national task any more; it is first and foremost a European responsibility. All this does not mean that the current European Growth and Stability pact is the only possible way to tackle the problems. European fiscal policy should be seen more as having the fundamental function of ensuring high-levels of aggregate demand. This strongly implies that until investment recovers from its long-term decline and households are able to spend without incurring high levels of debt; budget deficits will have to continue. This also goes with a need for coordinated pan-European public investment policies to spearhead growth and employment across Europe. A coordinated action for such a policy is much more effective than individual member states intervening independently in their own economies.

It is in that way that the French Prime Minister should talk to his European partners and especially to Germany. It is not helpful to accuse Germany and as a consequence heat up national resentments.

On the other side it is also not helpful that the German press is characterising French politicians and politics as schizophrenic. The French President, like the German chancellor, is elected. Both countries are part of Europe and hence in the same boat. The eternal debate about the German-French motor is a double-sided issue. If one is sick the other cannot survive in the medium and long run. Neither France nor Germany afford to go it alone any more.

The Juncker Commission: New orientation should have been different!

Posted by feps on 11/09/14
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The day after the official presentation of the new European commission by the President-designate Jean-Claude Juncker, the press remains ambiguous in its analyses. Some have praised the audacity to try a new structure with the designation of the 7 Vice-presidents, while the mergers and splits within some of the portfolios are still quite incomprehensible. Others are falling into the traditional trap of looking which post is attributed to which country, thus indulging the old ways of the previous mandate – within which the Commission was perceived as no more than the Council’s Secretariat. Finally others vehemently question the competence of some of the designated Commissioners. Of course, it is not easy to fulfil the wishes of all – but one can wonder, whose desires this Commission reflects. Even from a distance, it seems to fall short in terms of responding to the citizens’ wish for change – as expressed during the European elections

Four remarks:

1. President Juncker tried to appear as ready to tackle the key challenges of the EU for the next five years. Nominating popular Foreign Minister of the Netherlands, Frans Timmermans as First Vice-President responsible for better regulation (put simply: “in charge of preventing the EU from becoming even more bureaucratic and incomprehensible”) , he makes a serious attempt to respond to the citizens’ disengagement and find new paths for the EU integration. This is at the first glance not bad, but has to be implemented – which can prove more than tricky, with the fragmented EP and no urge for any Treaty change within the Council.

2. In appointing 5 Vice-Presidents as Coordinators responsible for finding answers to the most profound EU challenges, President Juncker appears inclined to aim at further politicisation of the EU Commission and exploring ways towards a new grand, cross-party coalition for change. This is a departure from the strategy adopted by the President Barroso, who searched for no political calling other than remaining at disposal of the European Council. If Juncker can restore the EU Commission to its treaty-based powers, this would be another good symbol and perhaps a step forward in unlocking the dysfunctional and imbalanced set-up currently in place . President Juncker seems to show to the Council that following the last EU elections and the subsequent mandate voted by the European Parliament, he holds democratic legitimacy and is therefore accountable for his actions. This is also not bad at the first glance, but this has to be proven!

3. Nevertheless, the composition of the College seems to embody the conservative project for Europe. Nearly all of the 5 thematic vice-presidents originate from conservative family. This will influence what initiatives and in what way they will be carried forward. Progressives have another approach to topics like the Energy Union or the Jobs and Growth policies and what is even more frightening is the Social Europe dossier. There is a real difference in seeing how far Europe is going on Jobs, Growth and Social Affairs. When the appointed Commissioner of Economic and Financial Affairs, Taxation and Customs proposes something progressive he will first have two hurdles to overcome before the idea is discussed in the College. This is not to mention the fragmentation of the EP again, because of which it will be most challenging to ensure supportive majority in anything beyond the first reading. We all know how Europe functions. This is a clear invitation to pursue the lowest common denominator and a sign of paralysis that the EU may experience this term.

4. But, any essential manual of modern management or university book on how to organise an administration warns against the creation of confusing structures or too many hierarchies. Who, for example, holds the ultimate responsibility for the digital agenda? Is it the Commissioner or to the Vice-President? To whom do civil servants of the administration report? Who decides the priorities in each political area? Is it the President, the Vice-President responsible for a thematic area or the appointed Commissioner? All this will probably create confusion. The risk is that the College is then concerned more with internal coordination than with clear political guidance! The structure of new Commission is not lean, and the Commissioner-candidates are already using the administration for their own benefits, telling the press in their respective countries a lot of fairy-tales. This is no wonder, especially since the nomination of the High Representative and the President of the Council was predominantly reported as a deal in between the countries, regions, euro-zone and non-eurozone, pro- and anti-Russia approach etc. – but was not at all commented as a decision reflecting European (party) political scene as it now stands. Therefore, the Council will again be the real decisive body within Europe. Hence, President Juncker’s Commission represents stagnation in the developments of recent years. It looks back to the interests of the different individual nations and not forward towards a more European future-oriented Union. In this light, the newly nominated President of the Council, Donald Tusk may indeed achieve the impossible – becoming in his post ‘the’ face of Europe.

This is not what the last elections with the top candidates were about. This does not represent the ambitious plans that were laid before the European electorate!

Is Mario Draghi kicking out financial capitalism and austerity policies?

Posted by feps on 06/06/14
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Yesterday’s decision of the European Central Bank to cut its key interest rate below zero and the other measures announced are more than a European way of the U.S. Quantitative Easing (QE). The ECB cut its main refinancing rate to 0,15% and its deposit rate from zero to minus 0,1%. The European Central bank is the first major central bank to endeavour into negative territory. In fact it is a historical breaking decision. It is particularly historical because it challenges the European Union institutional setting. It was not a genuine European procedure; rather it was an impartial decision of the board of directors of the European Central Bank!

A negative interest rate is the announcement to the financial markets that something is changing fundamentally. Banks are urged from now on by a simple declaration to channel money for real investment and not for speculation in the financial markets. European banks can no longer just ‘bunker’ money into the ECB. Even more the so called TLTRO program (Targeted longer-term refinancing operation) punishes banks when they don’t channel the credits to the private investment sector. This is the real revolution in European central banking: it is no longer the ‘invisible hand’, instead it has become a rule of the central bank to pave the road for investment and growth, rather than beforehand it was up to governments to initiate an investment programme.

There have been various comments and reactions especially from bankers but also from governments. Not surprisingly the harshest critics came from the former chief economist of the ECB, Jürgen Stark, and the head of the German IFO Institute Werner Sinn. They argue that the ECB decisions are a desperate attempt to pump more liquidity towards the south with even cheaper money. However they argue that the final bill will ultimately be paid by the small savers who will get barely any interest any more for their savings and the pensioners who will get less for their life insurance. They argue that this will affect in particular the richer countries in the North of the Eurozone.

Evidently, those criticising are largely orthodox monetary policy bankers stipulating that first and foremost price stability is the overall priority and investment comes second. According to them, firm consolidation of their structural economic problems is priority together with the substantial reducing of their debt. Moreover, they argue that there is already too much liquidity in the markets and lending will not and cannot be reinforced.

Nonetheless this decision is a real turning point of European monetary policy which has been for far too long influenced predominantly by the German Bundesbank and its orthodox and traditional approach of targeting only price stability and a low inflation rate rather than growth and investment.

Generally it is governments that have to provide stimulus with increased spending on public services and hence investments on stimulating growth. But the crisis countries are obliged to do exactly the opposite. They are cutting spending and increasing taxes to conform to austerity policies. As long as austerity policies prevail there is little hope for a vigorous economic recovery in the euro zone as the New York Times is commenting.

The ECB is now giving a strong wake-up call to these kinds of policies. Interest rates will now stay low for longer and more liquidity will be in the market to facilitate lending for investment especially in the south of Europe. This is the essence of the radical announcement.

Amazingly this links straight to the current negotiations on the top jobs in the EU. It is not by chance that some rumours stipulate that the German Chancellor, highly influenced by orthodox economists would like to get rid of this unorthodox Italian Central Banker. Rumours tell that she is trying to send him to the IMF in Washington. Is that the real merry-go-round behind in order to have not only a new mainstream president of the EU Commission but first and foremost another ECB head who is more in line with orthodox austerity policies?

Consequently the question lies if progressives allow conservatives once again to hinder a fresh start for Europe. It is absolutely inappropriate to try to smoothly sort out a non-conformist central banker who likes to stimulate growth and investment for substantially reducing unemployment especially for young people in southern Europe.

As long as European political leaders are continuing to argue that austerity is the only way out of the crisis they do not accept the dramatic consequences of these socially devastating policies! Mario Draghi seems to put an end to this with a courageous and risky decision and doesn’t address orthodox neo-liberals concerns. This makes him a truly avant-gardist. Hence, the decision is a historical break and a genuine starting point of kicking out devastating financial capitalism and austerity policies.

Towards the “MartinJuncker-Commission”?

Two days after the European elections the European parliamentarians took the initiative. The leaders of the groups in the European Parliament met and agreed to propose Jean-Claude Juncker as candidate for the presidency of the European Commission.

The European Council, convoked by its president Hermann van Rompuy for yesterday night, was stunned by this quick action from the Parliament. The long discussion in the Council and the statement after by the German Chancellor Angela Merkel reflects the way in which the heads of governments still behave.

The Lisbon Treaty stipulates that the Council proposes to the Parliament a candidate for the Presidency of the Commission on the basis of the results of the European elections. Of course, it would have been more “literally” in line with the Lisbon-treaty if the first reaction after the last Sunday elections had come from the Council. But it took a serious effort from the European Parliament to take the initiative and to put a serious proposal on the table.

This proposal reflects the reality of the results. Jean Claude Juncker was the leading candidate of the EPP (European People’s Party). The EPP came out as the strongest group. The second largest group is the Socialists & Democrats (S&D) and they endorsed and accepted the proposal of Juncker. So he has a huge majority in the Parliament. This is the way respecting the European voters’ will. It is also obvious that the backing of Juncker by the Parliament is in line with the “grand coalition” between EPP and S&D and hence there will and have to be a prominent place for Martin Schulz in the new EU Commission. The results gave a majority to the “MartinJuncker-Commission”!

It is irrational that the conservative leaders amongst the heads of state are now blocking their own leading candidate for the elections. When the progressive leaders in the EU Council supported the EU-parliament proposal, this was an act of respect to the will of the European voters. It was the French president François Hollande who set the tone in expressing the willingness of the progressives to support the conservative candidate Juncker!

Angela Merkel, and in particular the British Prime Minister David Cameron, have harmed European democracy in not taking the results of the European elections seriously. This is precisely the fear expressed in my last blog. European democracy will and can only improve when the respect towards the citizens is there.

But running a campaign, nominating a leading candidate, stipulating that this person is then to be proposed according to the results and according to the majority in the European Parliament and then in a “usual” backdoor-deal scenario, screwing up the whole process is exactly what Europe does not need. Let us hope that the Parliament will stay united and strong from now on.

However, the Tuesday meetings showed that Europe is on the way to becoming more transparent and open. It is now clear that the conservative heads of state would not like to diminish their “power”. The questions surrounding the LisbonTreaty do not pertain to juridical interpretation: it is now a pure question of power, of who has a say in the European institution. The Parliament has shown yesterday that it respects results and the wishes of European citizens.

10 observations on the European elections campaign

Posted by feps on 23/05/14
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1. The European election campaign undoubtedly helped the European Union to do an enormous step towards greater politicisation. Nevertheless the European Union is still far away to be a transnational democracy. There was still no unifying topic that mobilised voters across member states.

2. The decision of the PES (Party of European Socialists) after the last elections in 2009 to change from backroom deals of designating candidates for the high profile position was a historical turning point in EU democracy. The binding decision of the PES Congress in Rome to run with a top-candidate changed and personalised the vote.

3. Therefore, the highly respected candidate of the PES, Martin Schulz, was the most outspoken and in the positive sense “aggressive” top-candidate. His campaign – highly personalised, genuinely pan-European and highly relevant to national concerns in his home country – was a forward-looking agenda-setter for a more democratic Europe. He also improved his own credibility in Germany as a European leader and helped so the SPD to be seen as more European than before the campaign.

4. The campaign of Jean Claude Juncker was on the other hand less “aggressive”, underlining the fact that he had been pressured into running for the position. This shows that the overall conservative family do not “buy in” to the post-Lisbon processes and consequently made their campaign less “European”. The candidate also diverged from other conservative national leaders on certain European issue.

5. Personalisation broadened the democratic process and introduced quite substantially “more Europe” into the campaign, especially in Germany, France and Italy but also in Eastern European countries like Romania and Bulgaria. It would have been helpful to have more support from the media in the transmission of the “presidential debates”. For example, in France, they were not broadcast. The way in which this was set-up has to improve considerably for the next time.

6. However, an overall European enthusiasm was not seen in the campaigns around Europe. In a lot of the member-states the national party continued to campaign on purely national issues, with national campaign posters – like the CDU in Germany with Chancellor Angela Merkel rather than the top-candidate Jean Claude Juncker – and often on non-EU level topics.

7. Nevertheless, the debates about “more Europe” or about “a more democratic Europe” had a polarising effect. The Eurosceptics tried (hopefully without success) to benefit from their populist rhetoric that it is “Brussels” who is responsible for all the problems we currently face; it is “Brussels” that is bureaucratic, technocratic and hence illegitimate.

8. It was not easy for the pro-European parties to be on the one side critical towards the current political, institutional and democratic set-up and on the other side constructive and open-minded for further steps of integration. The argumentation of the neo-populists to brand non-voters as, by definition, anti-European has to be seen as very dangerous and unsubstantiated.

9. The Campaign showed very clearly that Britain is in a peculiar situation concerning its relationship with Europe. In the UK as in many countries across the EU, the European elections campaign focused on national issues. Additionally, in the UK we saw the odd situation whereby neither of the two top-candidates appeared during the electoral campaign. Due to its awkward relationship with the EU, British voters have not had an opportunity to scrutinise or vote for either of the two as the campaign of the top candidates was not brought to its doorstep, which is a shame because English language dominated in the campaign.

10. It is up to the heads of state to now propose to the European Parliament a candidate for the presidency of the Commission. If they will not take into account the results of the European elections, Europe will face a new crisis of legitimacy. There is hope that all the parties who have proposed top-candidates will stand by their commitment to block the proposal of the Council, in the event that this proposal ignores the democratic mandate given to the Parliament.

Common Foreign and Security Policy – Sovereignty must be shared!

Posted by feps on 19/02/14
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Invited yesterday to speak at a conference of the S&D Group in the European Parliament I raised the crucial question of the European Common Foreign and Defence Policy of the sharing of sovereignty.

Looking on the current state of the CFSP one has to admit that there is some “movement”. It seems also that many of the experts are excited.
- Excited that the December 2013 Council discussed this long awaited issue.
- Excited that at least in June 2015 the Council will discuss it again and
- Excited that as a consequence in some of the member states – especially in Germany – there is also movement.

Nevertheless the question remains whether this “movement” will culminate in a substantial, forward-looking, revised European approach. In saying this, I mean a substantial common approach to strengthen further the already on-going CFSP. Catherine Ashton was right to argue in her last speech to the European Parliament that Europe has to do MORE together and to do it MORE effectively. The current annual budget of €200 billion is no small amount of money.

But if the CFSP is to become the driving force of a coherent European approach of security policy a lot remains to be done. There is still the behaviour of the Europe’s “big players” – France and Britain. We are all aware that their foreign and security policy is far removed from a truly European approach. Of course there are historical reasons for this but it also has plenty to do with the overall construction of the European Union. At present, this is not a federal Union but one based on sovereign states and intergovernmentalism. In foreign and security policy, sharing sovereignty is still one of the most sensitive issues, especially when it comes to decisions on sending troops.

There is still the issue of the role of Germany in the set-up. The Security Conference in Munich last month was “promising”. The German foreign minister made some substantial proposals on a new German approach and the Defence minister – in her own way – went immediately to Western Africa to promise more active involvement of the Bundeswehr in Mali and other conflicts on the African continent.

And there is still the question of NATO, its policy and finally its existence. This was an organisation founded in the context of the Cold War to protect Western interests in a bipolar order. With the accession to the European Union of states once on the East of the Iron Curtain it is unclear what particular function NATO serves in the overall European geopolitical landscape. It is also clear that the bipolar world is not existing any more since more than 20 years!

Within the European Parliament, there is even a tendency for some MEPs to behave as if they are in the NATO General Assembly. Is it not time for EU member states’ security interests to be decided within our own internal constructs and procedures, and not one that is a relic of a much more conflict-prone world. I recognise that, as long as NATO is the coordinator of activities in Afghanistan, it is perhaps unrealistic to advocate its demobilisation. However, once it becomes more feasible, should we not make our foreign policy concerns genuinely European and not bound to the Atlanticist reflexes of the past.

Nevertheless, there has been some progress, not only during Brussels talks but also in concrete issues. The role of Europe and of the High Representative in the negotiations over Iran’s nuclear capabilities proved to be a particular high point. However, when you look at Central Africa or Ukraine it is evident that there are limits to the optimism we can hold. Indeed the Neighbourhood represents a significant opportunity for a proactive common approach if only we could harness. The establishment of the European Endowment for Democracy has provided a good example of how EU “soft power” can be used to help the growth of democracy among our neighbours but there is still much more we can do.

Furthermore, it is difficult to understand why it took such a long time to bring the famous “Solana-paper” to the table. This paper was future-oriented, promising and forward-looking.

Solana raises the question of potentially uniting European CFSP. Here lies the key question. Are member states willing to adopt a reflex that is “automatically” European? Again I come back to the Munich security conference. More or less everybody on the European level welcomed the German “move”. German Chancellor talked this week with the French President on an important involvement of Germany in Central Africa. My question on this is a simple one: Why was there not the simple reflex of Germany to discuss this “move” first with its European partners here in Brussels? Why is there still the thinking that Foreign and Security policy is first and foremost a question of national sovereignty and not one of shared sovereignty? A lot has been argued that the next step of European integration should be a common CFSP.
It is evident, in the context of European elections that our politicians will not go to marketplaces, on television and to knock on doors to talk to citizens about Foreign and Security Policy. As such, it is not a priority right now. Nonetheless, we should not forget that in this issue we possess something that could represent a significant advance in European integration.

TTIP could work if the pieces were in place … but are they?

Posted by feps on 04/11/13
Tags: , , , ,  

During the weekend I received some emails and comments on the proposal to establish the transatlantic trade and investment partnership (TTIP/TAFTA).

Talks between the EU and US started this summer. In the public debate taking place in Europe over the TTIP negotiation, it seems that we Europeans have to accept US standards and law and to adapt our system to the US system. An agreement in its proper definition is a negotiation achievable between two partners on an equal basis.

Just by coincidence I read an article today in the Financial Times that warns that Brussels’ stance could hit the trade deal and that Germany is pushing for tough data protection controls to be included in a proposed EU-US trade pact. This is fair enough in the aftermath of the NSA scandal. An agreement between the US and Europe cannot be only an agreement to implement US rules and follow the US business model. Europe guarantees the personal data of its citizens. TTIP has to consider this as a precondition before starting negotiating on any other technical trade item!

There are obviously a lot of differences in approaches and thoughts on TTIP. Even Americans are critical towards the current state of negotiations. For example, in a conference in Washington at the beginning of October, which was organised by FEPS in cooperation with Nobel Laureate Joseph Stiglitz and the Center for American Progress on macroeconomic cooperation and the international monetary system it turned out that not all of the Americans are supporting the argument that a single transatlantic market is a powerful vehicle for boosting economic growth.

This argument was also brought into the debate by the very critical study published in October 2013 by the Seattle to Brussels Network (S2B). It stipulates that a more realistic boost of the growth rate would be only 0.1% instead of the promised 1% of EU commissioner Karel de Gucht. If the reality is 0.1%, unfounded promises of increased trade and job creation can even reverse social and environmental regulatory protections. We all know that this could also be very risky for social cohesion and finally for democracy.

If that is the danger we as Europeans should simply not accept any TTIP agreement. We should then continue with our traditional trade relations. But ambitious proposals are often not so bad as foreseen. The best example is the EU as such!

With over one third of global trade such an agreement could create the world’s largest free trading bloc with all the implications, which will go far beyond the Atlantic. Trade and a different “form” of capital mobility create economic growth and jobs. This is not only economic theory in the pure Ricardian sense, but also an economic reality of globalisation. TTIP could be an example to establish decent work and it must prove that it is possible – even in times of ruthless globalisation and rising inequalities due to the race to the bottom – that decent work and social standards become a basis of a trade system based on the respect for citizens’ rights and their overall working and living conditions.

In the international system, we have rules and conventions signed by governments to protect citizens, consumers and workers. Regrettably they are not binding and hence not implemented at all. But if these basic rules are accepted and if in addition to that the EU and the US agree to go further, TTIP can foster social dialogue, create more decent employment, and increase respect to worker’s rights and social protection.

This is then not only a contribution to social peace but could stabilise the economy, fight inequality, stimulate aggregated demand and boost growth. If this will be the approach TTIP is a real opportunity to establish a model of trade based on respect and solidarity for the benefit of growth and jobs. Additionally the question that remains open is whether TTIP will reduce the role of the state in supporting innovation and economic development.

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