Thursday, March 22, 2018

Recycled prescriptions for the EU

An intriguing headline hinting at an important insight: It’s time for the EU to get real, an article by Jen Spahn, German Health Minister and a leading figure at the moment in Angela Merkel's Christian Democratic Union (CDU) party, in Politico EU 03/22/2018.

His fresh and innovative solution? Double-down on the most misguided macroeconomic policies on which Angela Merkel has insisted in her years as Chancellor, at great cost to millions of people in the eurozone:
The future of our shared currency, the euro, is also central to Europe’s future. Reducing the debt levels of member countries is vital, as is reinforcing the European Economic and Monetary Union and ensuring that actions and liability go hand in hand. Credibly enforcing the EU’s stability and growth pact is the key task. In this way, we can enhance member countries’ financial resilience and our ability to withstand the next crisis.

In order to make the euro-architecture more robust, the European Stability Mechanism should be further developed into a European Monetary Fund, as already proposed by former Finance Minister Wolfgang Schäuble. Such a monetary fund would have to include better early-warning and prevention mechanisms for crises and credible procedures for debt restructuring in order to protect taxpayers.

Some sort of neutral internal governance — committed to compliance with the treaties, rather than political opportunism — will be vital. That would also enhance the attractiveness of the eurozone for those countries who have not yet introduced the euro. [my emphasis]
He also has this suggestion, "A recent proposal to provide a four-week Interrail pass for all school-leavers in the EU is intriguing, as it would help foster a connection to other Europeans. These are costly projects, yes, but they would allow us to make a positive — and distinctly European — mark on the world."

Easier than creating a common eurozone fiscal policy and budget, I guess. Not to mention creating shared eurozone debt instruments.

Spahn also has the not-exactly-bold suggestion of increasing the staffing of the EU Frontex border-patrol agency. He declares, "The issue that clearly causes the most anxiety with voters is migration. As long as human traffickers, rather than border officers, decide who sets foot on European soil, we put at risk one of the greatest achievements in European integration: the freedom of movement." This is a CDU-ish nod to anti-immigrant rhetoric, i.e., "human traffickers, rather than border officers, decide who sets foot on European soil."

The European immigration problem - a continuing crisis, actually - is not due to enterprising people smugglers, uh, "human traffickers." It's due to wars in the Greater Middle East including Afghanistan, and in North Africa. Along with the increasing and long term effects of climate change. It's a European problem. One whose actual solution will involve, yes, European countries agreeing of accepting a certain number of refugees. And preparation of adequate emergency services for spikes like those of 2015. All of which will require a practical attitude of solidarity, or cooperation, if you prefer. The nationalism and national resentments generated by Merkel's handling of the euro crisis have made that much more difficult.

If vague pronouncements like, "The creeping power grab by the European institutions must end," is all the EU leadership can come up with, that doesn't promise a happy future for the EU. Particularly since the eurozone's Fiscal Pact forces most eurozone countries to adopt procyclical austerity policies during recessions.

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