“The euro has profound economic advantages and is the most powerful symbol of European integration,” said not some wild-eyed dude with a joint between his lips, slouching in a café in Amsterdam, but the “Final Report“ issued by the Future of Europe Group, composed of the foreign ministers of Germany, France, Italy, Spain, the Netherlands, Poland, Belgium, Austria, Denmark, Portugal, and Luxembourg. It remains uncertain what they were smoking.
But they did fret about the future of the euro and the EU, their chef d’œuvre. To keep it glued and duct-taped together, they came up with a laundry list of recommendations concerning its governance. It included the vampire item that simply refuses to die, namely shifting sovereignty over national budgets to the European government.
To their credit—or was it just window dressing, given the uproar on the internet?—they also called for more “democratic legitimacy and accountability,” of which only trace elements are discernible in the EU government. One of the key items: “a directly elected Commission President.”
Then came the eurocrat response.
“If this is not going hand in hand with large powers for the Commission, then forget it,” said European Council President Herman Van Rompuy at a conference centered on that Final Report. It would give that top job “a huge legitimacy,” he said, but it would “organize the disappointment in advance.” Only by handing “large powers” to the Commission could a directly elected Commission President become functional.
Another step in the ongoing and ever so methodical power grab.
Just then, a 52-page draft report by the unelected European Commission President José Manuel Barroso bubbled to the surface—a continuation of his bureaucratic drive to create the United States of Europe come hell or high water.
To overcome “the crisis of confidence,” he called for “fast and deep” integration and envisioned a powerful European government. It would, for example, have the power to coordinate how Member States tax their citizens—with the unspoken goal to alleviate tax competition between countries, a recurrent complaint by high-tax countries against their lower-tax brethren. Even in the USA, the federal government doesn’t attempt to tell the states how to tax their residents. It would cause a revolt.
Barroso, building on his idea of a United States of Europe, also wants to give the Commission, his Commission, the power to veto the budgets of Member States. Imagine the White House vetoing California’s budget—OK, that budget should be vetoed because it’s a sham, but it’s our sham, and we will deal with it or sink with it. White House interference would be a reason for secession.
He wants to endow that souped-up government with the ability to levy its own taxes, rather than be dependent on handouts that are determined during bitter budget negotiations by the 27 Member States. It would be a coup. It would give the European government the power to impose taxes on already overtaxed people—with little or no democratic limits.
And all that without a constitution. Because the people had voted it down by referendum.
Meanwhile, Dutch Prime Minister Mark Rutte was giving interviews left and right, to reject exactly what the eurocrats were trying to push through: a federal Europe. He believed in a Europe of national states that worked together closely.
Instead of all that federal razzmatazz, he demanded that Eurozone countries “stick to the commitments that they made when they introduced the currency.” Hence, deficits not to exceed 3% of GDP. And austerity. That would be “essential for the survival” of the euro, he said. And only that would make the euro “credible.” The goal should be to strengthen the euro “and attack the dollar as world currency.”
He had something for everybody. Including Greece: treaties should be tweaked, he said, to allow a country that doesn’t follow the rules to leave the Eurozone without also having to leave the EU, which is currently not possible. And haircuts for official sector creditors, such as the ECB, that are holding most of the Greek debt? Not a good idea, he said. Not only for legal reasons, but also out of principle. “That would send the wrong signal to other countries that have debts … like America.”
“I cannot be disillusioned because I no longer have any illusions about Europe,” muttered Euro Group President Jean-Claude Juncker a while ago.
Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate “beer money.” I appreciate it immensely. Click on the beer mug to find out how:
Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.