EU Recovery Fund

[XXL]

https://www.reuters.com/article/us-eu-recovery-france-germany/its-up-to-us-how-merkel-and-macron-revived-eu-solidarity-idUSKBN22W0JB

 

BRUSSELS (Reuters) - It took a courtroom of scarlet-robed judges to spur Angela Merkel to make one of her boldest moves in 15 years as German chancellor: propose huge cash handouts to the European Union's weaker economies.

Merkel was already worried about the future of the Union after the coronavirus pandemic struck Europe in February, triggering a wave of deaths and crippling lockdowns.

But it was Germany's own Constitutional Court that tipped her hand, sources said. Its bombshell ruling on May 5 challenged the EU's reliance on European Central Bank (ECB) money-printing to keep its weaker members' economies afloat - and the EU's governance.

 

 

 

Until then, Merkel had opposed a proposal by French President Emmanuel Macron for a Recovery Fund that would, for the first time, bind all 27 member states to raise debt jointly.

"Initially they were on quite different positions," said one senior diplomat. "They reviewed the risk of a split in the EU. But then the Constitutional Court decision came and Merkel ... said: 'It's up to us, the governments'."

A series of video calls between Merkel and Macron led to a plan for the European Commission, the EU executive, to borrow 500 billion euros ($550 billion) as common debt and transfer it to the regions and industries hit hardest.

It would be a top-up to the EU's 2021-2027 budget, already close to 1 trillion euros.

Diplomats in Brussels, Paris and Berlin familiar with the discussions said Merkel had dropped Germany's long-held opposition to mutualising debt to fund other member states - when it became clear the EU itself was in peril.

The court ruling in effect put the onus on EU governments themselves to fund any fiscal response.

 

European leaders agree that, if they fail to rescue economies now in freefall, they risk something worse than the debt crisis 10 years ago - which exposed faultlines, fanned euroscepticism and almost blew up the eurozone.

[XXL]

UNION IN NAME ONLY?

The pandemic has derailed the recovery of the EU's most indebted countries. Italy's debt is shooting towards 170% of national output, Greece is losing gains wrung from years of belt-tightening and, across the south, a collapse in tourism threatens millions of jobs.

Surely the moment for the Union to live up to its name.

But members' initial slowness to share medical equipment, and readiness to close their borders, seemed to demonstrate Brussels' irrelevance when national interests are at stake. 

 

Divisions erupted at an all-night videoconference of EU leaders on March 27 as fiscally conservative northern countries resisted pressure from a "Club Med" group to raise a splurge of mutual EU debt to tackle the effects of the pandemic.

 

 

Finance ministers agreed on April 9 to an EU-wide rescue plan worth half a trillion euros, but it was too little to fund long-term recovery, and the feud festered on. Berlin insisted any recovery plan must consist of short-term, repayable loans.

Then Merkel and Macron began talking.

"Merkel became increasingly aware that it was making Europe look really bad," said an EU official familiar with Macron and Merkel's consultations with the Commission.

Just when it seemed that this latest in a series of traumas, from sovereign debt crisis to a chaotic wave of migration to Brexit, could finally tear the bloc apart, the deal hints that the two founder members can still provide the EU's steady core.

It may also boost Macron's standing and his vision of more integration as Merkel ends her long tenure.

The Commission, which presents its own proposal on May 27, warmly welcomed the initiative, but the deal is not yet done.

[XXL]

To pass, it needs backing from all 27 capitals, and Austria's leader has already said that he, along with the Netherlands, Denmark and Sweden, will offer only loans, not grants.

 

 

[Raider of the lost Ark]

And it all goes back to the faulty construct of the Euro. Against all economic and financial wisdom the Euro was introduced for political reasons. The shady and downright criminal things that went down back then are numerous. But has there ever been consequences? No. Now we are all in a dire financial situation. Mechanisms that worked in favor of Southern Europe harmed Northern Europe. Mechanisms that worked for Northern Europe harmed Southern Europe. And I'm talking about the European citizens. Not European companies and banks. They have done very well ever since. Another proof that so called trickle down effects do not work. And don't get me started on Brusells and the ECB. What excactly are they doing for the European people? It's hard to figure out. Which means they either don't do anyting or they have a communications problem. Even worse, they do not seem to care about treaties and laws anymore. When was the last time they read the Maastricht treaties? The content might come as a bad awakening for them. Especially the part that deals with the financial liabilities of the Euro member states. 

And Macron? You think he is altruistic? Well, have a look who is holding hundreds of billions of Spanish and Italian debt. He is merely saving the french banks. 

I think it is time to realize that the Euro has failed. It simply does not work with how economies and social systems in all the different member states are set up. As said above, everyone knew about this from the beginning. Now it is just a question to find a way to get away from the Euro. It is not going to be nice, that's for sure. But the longer it goes on, the worse it gets. People say the solution is a common European household, common European taxes, a common European social and pension system. That probably looks good on paper, but in reality the idea is simply delusional. Knowing this will never happen, I wonder how Long they want the drag on. That said, the EU existed Long before the introduction of the Euro and has done tremendous things. We should concentrate on that. On everything we can find common ground, on things that are really in favor of each of the EU countries. This is how a strong EU should look like. Economy and finances are obviously none of these things and I'm highly pessimistic for the future. 

[karbatal]

I don't think the Euro has failed. It's the neocon ultra liberal economy what has failed in many many ways. Just look who is opposing to this fund: the Austrian ultraliberal who didn't doubt to pact with tight extremists and who just yesterday asked for less government and regulations in favour of economy. The other? The Dutch one, protecting his country, who's been living for decades inducing dumping and becoming a fiscal haven. 

Funny that Netherxit happened before Brexit, but the Netherlands stepped back knowing how much they'll profit now that The City will no longer be the financial centre of the EU. 

Ugh!

I am very optimistic of the future. I'm sure those two will swallow their liberalism and some fiscal union will become a reality. Just wait how soon Netherlands will agree to all: the second its haven is questioned in Brussels.

[Raider of the lost Ark]

16 hours ago, karbatal said:

I don't think the Euro has failed. It's the neocon ultra liberal economy what has failed in many many ways. Just look who is opposing to this fund: the Austrian ultraliberal who didn't doubt to pact with tight extremists and who just yesterday asked for less government and regulations in favour of economy. The other? The Dutch one, protecting his country, who's been living for decades inducing dumping and becoming a fiscal haven. 

Funny that Netherxit happened before Brexit, but the Netherlands stepped back knowing how much they'll profit now that The City will no longer be the financial centre of the EU. 

Ugh!

I am very optimistic of the future. I'm sure those two will swallow their liberalism and some fiscal union will become a reality. Just wait how soon Netherlands will agree to all: the second its haven is questioned in Brussels.

But a fiscal union only solves certain problems. The biggest being the fact that some countries use low income taxes for companies as a business model to generate taxes for their own countries. The Netherlands is one of those countries. But Ireland is certainly the worst offender. And Luxembourg of course. All of this is home made. All of this was made possible by the EU, by creating laws that allowed companies to found Societas Europeea (SE) and other forms to shift profits and costs from European countries with high income taxes to countries with lower taxes. Everyone knows it is wrong. But why does nothing happen? I think it is pretty clear that there is a lot of corruption going on. I think I read somewhere that there are more staff members of lobbying firms in Brussels than there are staff members of the EU. Go figure. 

Anyway, the reason I said the Euro has failed is that there is just no way for a common European debt. The EU treaties do not allow any of that. And there is no way this is going to change. People could not even pass a European constitution. To even believe that any parliament of the Northern European countries would agree to that is wishful thinking. There is simply no backing by the citizens of those countries for such measures. Keep in mind that those nations and their citizens are very conservative when it comes to finances. And unfortunately many people in Northern Europe are under the impression that certain countries in Southern Europe (again, not neccessarily the citizens) are living way above their means for a long time. And everytime those countries are on the brink of bankruptcy they call for the Northern countries to accept liability for all the new debt they are making by calling it solidarity. Of course, they know this is not possible because the Maastricht treaties explicitly prohibit this. But it is always a good selling point with their own citizens. Shifting the blame. 

As I said before, there is just no way for a common EU debt. If any Northern European parliament would dare to pass anything in favor, despite knowing there is no backing by the people, will result in Nazi parties winning the next elections by a large margin. And this will be the end of the EU. 

 

[elijah]

I think it would happen. First Maastricht treaty was subsequently changed dramatically with Amsterdam and Lisbon treaties. I do not think there is an explicit article in the Treaty on the Functioning of the European Union forbidding common EU debt... Most of the articles are vague, allowing cooperation in certain areas, if an agreement is reached within the EU institutions and between the EU states. I find it hard to imagine France and Germany would propose a fund which is not in line with the EU treaties. As for the northern states - maybe those not wanting to participate should be excluded from EU Recovery Fund and should neither carry the burden nor profit from it (should be regarded as 3rd state as far as the fund is concerned). Europe on 2 speeds: only the willing are participating. I understand that would present for outlookers that EU is once again weak and not united (and at present there are many enemies that would be happy about it), but this outcome is better than NL or AU putting a break to EU recovery...

[Rebel Saviour]

On 5/21/2020 at 2:39 AM, XXL said:

To pass, it needs backing from all 27 capitals, and Austria's leader has already said that he, along with the Netherlands, Denmark and Sweden, will offer only loans, not grants.

 

 

I'm curious to know what @Genevieve Vavance thinks of his young prime minister.

[horn]

Oh Macron!   

[XXL]

On 5/21/2020 at 2:52 PM, Raider of the lost Ark said:

And it all goes back to the faulty construct of the Euro. Against all economic and financial wisdom the Euro was introduced for political reasons. The shady and downright criminal things that went down back then are numerous. But has there ever been consequences? No. Now we are all in a dire financial situation. Mechanisms that worked in favor of Southern Europe harmed Northern Europe. Mechanisms that worked for Northern Europe harmed Southern Europe. And I'm talking about the European citizens. Not European companies and banks. They have done very well ever since. Another proof that so called trickle down effects do not work. And don't get me started on Brusells and the ECB. What excactly are they doing for the European people? It's hard to figure out. Which means they either don't do anyting or they have a communications problem. Even worse, they do not seem to care about treaties and laws anymore. When was the last time they read the Maastricht treaties? The content might come as a bad awakening for them. Especially the part that deals with the financial liabilities of the Euro member states. 

And Macron? You think he is altruistic? Well, have a look who is holding hundreds of billions of Spanish and Italian debt. He is merely saving the french banks. 

I think it is time to realize that the Euro has failed. It simply does not work with how economies and social systems in all the different member states are set up. As said above, everyone knew about this from the beginning. Now it is just a question to find a way to get away from the Euro. It is not going to be nice, that's for sure. But the longer it goes on, the worse it gets. People say the solution is a common European household, common European taxes, a common European social and pension system. That probably looks good on paper, but in reality the idea is simply delusional. Knowing this will never happen, I wonder how Long they want the drag on. That said, the EU existed Long before the introduction of the Euro and has done tremendous things. We should concentrate on that. On everything we can find common ground, on things that are really in favor of each of the EU countries. This is how a strong EU should look like. Economy and finances are obviously none of these things and I'm highly pessimistic for the future. 

 

I agree with you on the common currency, the way it was built and groomed was a curse from day one. The original European project and the noble ideals of the 50s sustaining it were very different from the kind of final kiss of death the 90s political class gave to it

Aside from the fact that a system of countries with a common currency but with 27 different fiscal structures, income brackets, political situations etc is doomed to short circuit at one point or other to begin with, the EU has become entrenched in its nasty vision for austerity and in criminally seconding the financial and banking sector at the expense of taxpayers livelihoods and sacrifices

What the IMF and the EU etc did to Greece ten years ago is simply disgusting. The Greek people were not responsible for the holes left by a corrupt political class conniving with big finance, yet they have been punished and made to pay the price for crimes others committed. And Greece is historically the cradle of European culture and civilisation. It's such an insult to our cultural roots

The fact that small countries and worldwide renowned tax havens such as the Netherlands are actually threatening to halt help to Spain, Italy and Portugal or oppose this idea of a common fund for recovery not meant as a loan but an interest free liquidity injection to prevent the worst effects of the looming massive recession is simply ludicrous

Italy is the third industrial and economic power within the Eurozone after Germany and France.

If Italy collapses the whole European project collapses. And not just in economic terms but also from a geopolitical perspective given the Italian position in the Mediterranean, everything that's going on in Libya and the Middle East and the myriads of NATO bases we have on our soil

Meanwhile FCA, meaning the newly born automotive conglomerate Fiat/Chrysler/Peugeot are asking the Italian government for an extra €7bn, amid this kind of emergency which will have, is already having in fact, awful consequences for so many households in Italy and all over the world, while they have their legal and fiscal HQs, guess where, in the Netherlands

This is one example of what's gone wrong with this flawed political construct called EU.

That said, it doesn't mean I'm suddenly for Brexit which simply stems from a misplaced nostalgia for an imperial past that doesn't exist anymore.

However if Brussels etc don't start calibrating their aim and getting their shit together ASAP, I doubt the EU can survive another ten years, maybe not even five

[Genevieve Vavance]

On 5/22/2020 at 5:40 PM, Rebel Saviour said:

I'm curious to know what @Genevieve Vavance thinks of his young prime minister.

He's horrible  

 

I voted for the Socialist party honestly

[karbatal]

16 minutes ago, Genevieve Vavance said:

He's horrible  

 

I voted for the Socialist party honestly

You're the sunshine of Austria!

that ultraliberal who made a governing pact with the right extremists  is appalling. He and his deformed ears

[Genevieve Vavance]

1 minute ago, karbatal said:

You're the sunshine of Austria!

that ultraliberal who made a governing pact with the right extremists  is appalling. He and his deformed ears

they should have tossed him with FPÖ leader Christian Strache after the Ibiza video debacle  

 

[Rebel Saviour]

1 hour ago, Genevieve Vavance said:

He's horrible  

 

I voted for the Socialist party honestly

Of course, he is!I would slap his idiotic faceHe's acting like a major cunt against Italy right now.

 

1 hour ago, Genevieve Vavance said:

they should have tossed him with FPÖ leader Christian Strache after the Ibiza video debacle  

 

Please, remind us. What happend?

[XXL]

1 hour ago, Rebel Saviour said:

He's acting like a major cunt against Italy right now

 

[karbatal]

On 5/23/2020 at 9:07 PM, Rebel Saviour said:

Of course, he is!I would slap his idiotic faceHe's acting like a major cunt against Italy right now.

 

Please, remind us. What happend?

The stupid Austrian chancellor got into power by pact with the ultra right xenophobic party. The leader of the right extremists cunts was taped in Ibiza being a complete corrupt. 

I find it so sad that right centrists parties in countries like Austria or Spain, who have suffered so much with the Nazis (Austria) and the right extremist dictatorship (Spain) have zero problems to pact with the neo Nazis... Masks are down indeed

[horn]

[karbatal]

One of Germany's ministers explained today that creating the fund would be profitable for everyone, as exports and commerce between EU members would be better. That's something elementary in economics. 

Those frugal four ministers are STUPID

[XXL]

Fucking travesty going on in Brussels right now, as expected

The false narrative of the frugal virtuous countries versus the irresponsible ones.

Italy and its working and middle classes, for all, has already paid a high tribute to Europe in terms of tax, job reforms and ten years of manic so called austerity to the EU bureaucracy during the past 12 years alone

Besides there is the most important consideration to make

Who the fuck is the Netherlands to rear its ugly fiscal head to? A country that within this type of dying EU construct (veto system where one ant country can block another couple of dozen member countries, no fiscal unity) has prospered and prospered thanks to the various FIAT General Motors Chrysler Peugeot etc, Amazon, Facebook etc taxes not paid in individual countries and funnelled into the Dutch economy

What exactly is the NE industrial clout or industrial world renowned pride??

Who are Germany, France and Italy, oh, the three biggest net contributors to the whole EU Castle and its three biggest economies

Yes, let Italy fall because Italians are lazy (lie, obviously) and spend too much and too poorly (the incompetence of our corrupt political class of decades past, an endemic historical organised crime issue and the heavy influence of a tax non compliant Vatican in Italian territory is certainly not minimally ascribable to the Italian population) you Rutte moron

But Merkel only knows too well, the expert politician. If Italy fails the EU will be officially declared DEAD. She doesn't want this stain on her impeccable CV as she readies her way out of the political scene she's dominated during the past 15 years

And yes the "spolit bad Mediterranean children always schooled by Brussels"  of Spain, Portugal and Greece deserve that cash pronto too you Rutte FUCK Fest

[XXL]

And do me a favour, if the EU truly wants to survive it has to dispose of the travesty of the fiscal paradise countries system. Netherlands, Luxembourg and the Republic of Ireland off the top of my head now

A Court has just reversed a previous EU sentence that imposed Facebook a fine for not paying what it actually owed in terms of its huge size in EU operations and said Ireland was right in receiving a minimised payment instead. The Irish government thanked them profusely of course 

This type of thing is also what's killing the entire six decade plus old European project. Then they have the nerve to demand more "job reforms" (i.e. people have to become total slaves but they call it mixed and flexible job market). ENOUGH

[Raider of the lost Ark]

Sometimes I wish, people would merely act in common sense. Many things will work out much easier and faster. But of course, especially in Brussles eveything is always super complicated, everyone is paying the biggest attention to the most irrelevant things and everything takes ages to get done. Two of the most obvious things that basically everyone is fed up with is a) as @XXLhas already mentioned, the business model of three member states, namely Ireland, The Netherlands and Luxemburg, to offer incredibly low income taxes for companies which of couse found a SE in one of those countries to prevent paying income taxes in the countries, their profits were actually made. And European legislation makes it possible. I have yet to meet one person that thinks the system is fair. The contrary is true, everyone knows it is a system that needs to be changed. And b) When will the EU finally grow some balls and punish Poland and Hungary? Both are the biggest money takers from the EU and the political situation in both countries has evolved into something that is very much the opposite of what the EU used to stand for, in regards to human and civil rights. Rights that are enshrined in the laws of the EU and both countries have sworn to uphold when they joined. The inability or unwilling to do something on this matter, opens a door for each and every other country in the EU to ignore what has once been agreed on. There were certain rules imposed for good reason (one of them the debt situation of each country) because they knew, without rules, without discipline, the whole construct will fall apart. And look where we are now. It is crumbling as we speak. Thanks to certain countries and even EU institutions (ECB, hello?) disrespecting the rules without consequences. 

[karbatal]

Those frugal CUNTS can go fuck themselves in hell

 

[karbatal]

Who are they anyway? 

From Holland, a racist leaning on populism. to win the Election next January

From Austria a far right cunt who pacted with Nazis

From Sweden a cruel government that doesn't care if elderly people die from Covid

I don't know the other but surely is a cunt