The work on the setting in place of European economic governance is taking shape. It's practically routine, but in actual fact this constitutes fundamental progress in European integration. The European Commission has presented its legislative package and the taskforce chaired by Herman Van Rompuy has almost finished the first phase of its work; the first “European budgetary semester” is approaching.
Understandable differences of opinion. The work of the Commission is going in the same direction as that of the taskforce, with the Commission taking responsibility for making choices over any points or positions which differ at a national level. The member states, although unanimous over the outline, cannot agree on various aspects of the implementation. Does this come as a surprise? Their situations are not identical, any more than their national interests are. The taskforce operates at a very high level, with the involvement of the finance ministers, the president of the Eurogroup, the commissioner with responsibility for economic and monetary affairs; but it will not decide upon everything itself. On sensitive issues, the decisions will be made by the heads of state and government, very often by compromise. The two basic principles are in place: reinforced sanctions for any country failing to respect the limits laid down for the annual budgetary deficits; taking into account of not only these deficits, but also of overall debt. However, the details of the sanctions and their more or less automatic nature remain to be specified. Earlier this week, in his comments following the meeting of the taskforce, Herman Van Rompuy confirmed the consensus on bolstering the supervision of overall debt, and reiterated that the sanctions would become more automatic and that they would be adopted on the basis of inverted majority: the sanctions, which will be proposed by the Commission, will be adopted if the majority of the Council does not reject them. This is the procedure the Commission itself is proposing (see our bulletin no. 10225). But France, Italy and various other member states kept their reservations in place, stating that the calculation of overall debt (which should not, in theory, exceed 60% of gross national product) should take other factors into consideration: private debt, the duration and currency of the public debt, the solidity of the financial system. The Commission accepts this.
Why make a song and dance out of a few differences in opinion? Compromises are possible, and the European Parliament, which is due to take position on the regulatory plans of the Commission, will have the casting vote. Focusing on the problems to the exclusion of all else neglects the main thing, which is that the new discipline is taking shape after ten years of the (partial) inefficacy of the Stability Pact.
Non-existent revelations. The second event which put the press (and quite a few MEPs) into a state of agitation did not, in my view, merit half as much attention as it got. I refer to the pseudo-revelation by the Wall Street Journal of the existence of a secret European committee credited with saving the euro. What our American colleagues discovered is not incorrect, but nor is it news: it is just a round-up of various meetings conferences and talks leading to decisions and support mechanisms for Greece and other countries of the euro zone. All you have to do is have a scan through our bulletins from the period in question to conclude that all of this was already in the public domain, with the exception of the names of some of the protagonists in the preparatory phase of the great rescue mission, the definitive decision for which lay at the level of the finance ministers and of the heads of state and of government. The secret committee was made up of representatives of France, Germany, the European Commission, the Eurogroup and the European Central Bank: all those with responsibility at some level for the euro. Jean-Claude Juncker then organised a tele-conference between the eurozone finance ministers, to develop the draft declaration, which was definitively approved when Mr Van Rompuy, Mrs Merkel, Mr Sarkozy and Mr Trichet met at the Solvay Library. Was there a single journalist around that day who was unaware of what was going on? After all this, the European Council as a whole was convened and agreed to the strategy and the well-known financial commitments.
At the same time as the American investigations were going on, the British weekly The Economist published an article on the “follies of the euro”. It leads one to wonder whether what's behind these supposed revelations (secret committee, euro managed behind closed doors) isn't the fact that the decisions concerning the euro are increasingly taken by the countries whose currency it is, which is logical. The United Kingdom and its great ally (in matters financial) on the other side of the Atlantic are not involved; they are informed after the fact. Nicolas Sarkozy's request for the creation of a specific European Council for the eurozone was kicked out due to various institutional complications, but it effectively already exists as Mr Van Rompuy brings together the eurozone heads of state and government when he sees fit. The City of London is starting to worry about this, as is the US. Is this what's really behind the above journalistic exploits?
(F.R./transl.fl)