Jean-Claude Juncker delivers his State of the Union speech at the European Parliament

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Chiméra francouzsko-německé reformy

Oct 4, 2017 Hans-Helmut Kotz

CAMBRIDGE – Ve Spojených státech je trvalou pravdou, že veškerá politika je lokální. Stejné pravidlo lze (do jisté míry) vztáhnout i na Evropskou unii, jejíž agenda v konečném důsledku závisí na národních politikách klíčových členských států.

Zejména to platí ve vztahu k institucím eurozóny, u nichž se téměř všichni shodují, že naléhavě potřebují reformu. Posílení eurozóny bylo ostatně společným tématem významných zářijových projevů předsedy Evropské komise Jeana-Claudea Junckera a francouzského prezidenta Emmanuela Macrona.

Juncker ve svém projevu o stavu EU směle nastínil svou ambiciózní vizi evropské budoucnosti. Vyzval EU, aby dokončila bankovní unii, zavedla evropské ministerstvo financí (plně začleněné do komise) a rozšířilo unijní rozpočet.

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Walter Gingery Oct 7, 2017

The EU is like a Samuel Beckett play: "I can't go on; I'll go on."
"Ever tried. Ever failed. No matter. Try Again. Fail again. Fail better."
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j. von Hettlingen Oct 6, 2017

Hans-Helmut Kotz sees the Franco-German efforts to fix the eurozone a "chimera." Jean-Paul Juncker and Emmanuel Macron may have proposed wide-ranging reforms to revamp the eurozone that are urgently needed. But its fate now lies in Angela Merkel's hands. The German chancellor is seeking to cobble together a coalition government, which will most likely make up of the pro-business Free Democrats and the eco-friendly Greens - two partners that have been at loggerheads with each other.
Both Macron and Merkel face considerable challenges at home, raising doubt whether they will have the time and energy to focus on the European project. During the campaign Macron made reviving France's economy and saving the EU his two big policy goals. But pushing France a little farther down the road of labour market deregulation and fiscal austerity is a tortuous path, even though unemployment rate is stubbornly high. Boosting the economy is vital to Macron. Without significant advances, he won't be able to convince Germany of his ability to reform the eurozone. He urged to press ahead with closer integration by harmonising asylum, defense and economic policies. His plan - a common budget and finance minister for the eurozone - received warm words from Berlin.
Now after the September 24 election clouds may hang over the Franco-German ambition and there is fear that Merkel might not be able to follow through, given her reliance on the Free Democrats, who are sceptical of Macron's eurozone plan. Many believe her priority will not be for a European fiscal union where German tax revenues are being poured into a common European pot. She had given her support to only a very modest version of what Macron proposed. The payoff for all of France’s sacrifice at home could disappoint him.
Although Germany's economy is booming, there are plenty of signs of trouble ahead. Apart from low birth rates and an aging population, growing poverty among single parents, long-term unemployed, immigrants, elderly, and low-skilled workers has cast a long shadow over social stability, creating a growing sense of inequality and injustice. Not to ignore are the demands for reform of the immigration policy and the pensions system.
Despite Germany's well-oiled economic engine, challenges emerge from the ailing steel industry, which employs thousands of workers, to the diesel crisis and calls for the abolition of the combustion engine, which requires government intervention to ensure it doesn’t do lasting damage to the German car industry on which around 800,000 jobs are dependent. Merkel is also aware that Germany is lagging behind other developped nations in its digitalisation performance.
It remains to be seen how solid Merkel's new coalition will be and whether she can rein in her sister party, the CSU, which is veering further to the right. Having suffered losses in the recent federal elections the CSU is facing regional election in Bavaria next year, and it will do everything to defend its turf. Unlike Macron, who is determined to translate campaign pledges into actions, despite plummeting approval ratings, Angela, "beholden to the median German voter," may choose to play "safe."
The author says, the "German political center has been shifting, and it is heading in a different direction than Juncker and Macron. As a result, the eurozone’s institutional design will likely remain incomplete." But he shouldn't write off this Franco-German endeavour so soon and give Merkel and Macron a chance.
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Jonathan Engel Oct 5, 2017

The increasing disconnection of the Commission, exemplified, indeed caricatured by the Juncker's speech, in a context where Eastern Europe is having doubts about the immigration agenda, and where the Brexit vote should at least be raising questions, suggests to many that the EU formalism built on a successful EEC base, is quite simply "a bridge too far"....
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Henk Crop Oct 5, 2017

It is not bad that the eurozone's institutional design remains incomplete, at least for some time.
The EU common market is a great achievement. But the last 15 years the EU has performed not very well, moving from one crises to another. Losing populairity along the way.
So it is time for a pause. Learn from mistakes and review if democracy is adequately safeguarded.
Mr. Junkers in his State of the Union address planned to, rapidly, build a total EU state with himself/successor as the leading President.
In a poll held in the Netherlands his proposals were rejected by 96 % of the respondents.
The major threat to the EU and to the EU citizen is the democratic deficit and reckless management by the EU.
So, I hope that the leaders of Germany and other member states give priority to answering the question as how the EU must be managed.
- The EU commission functioning as a runaway train. Isolated from the people, they call populists.
With unbound ambition seeing the world as areas of solidairity, they must interfere with.
- The Functioning of the EU parliament representing the people.
- The role of the the EU leaders who treat the EU as a parttime project, while most laws are already made in Brussels.
- Better cost control and transparancy.
- Must the EU be led by Germany and France only ?
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John Leontop Oct 5, 2017

Dear Mr. Kotz,

for transpareny sake you should mention that you have been a long time adviser (and still are?) to the Social Democrats.
In addition, while at the Bundesbank you were responsible for the department "Financial Stability, Markets and Statistics". Where were your warnings re the dangers to the world financial systems of overindebteness back then?
In my humble view you are the typical elitist who has lost total touch with the common people and are an archetypal representative of the sort of IYIs (please check with Nassim Taleb for the abbreviation) responsible for the populist election backlash.

PS. All business leaders have to disclose their earnings in an annual reports, members of parliaments usually have to make full disclosure of income, why is there no such requirement for all the thousands of media people and advisers?
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Steve Hurst Oct 4, 2017

The Federalism faithful.

'A casual stroll through the lunatic asylum shows that faith does not prove anything.' Friedrich Nietzsche

The EU; divided we stand, united we fall

Junckers is one of the faithful and will end up a footnote, his strategy is non existent, it has basically collapsed into a multi-speed proposal which is just a free-for-all, or more possibly a cash-for-all. Macron wants German debt underwriting. To understand France- German relationships you need to look at the Maginot Line and the events that lead up to it. France felt vulnerable, wanted unhindered access to German resources which it effectively failed in gaining. The answer was French investment in a delaying device, the Maginot Line. Macron is simply following the pattern. He wants access to German resources - debt sharing - and is investing in a delaying tactic, claiming reform can be achieved and the euro made sustainable. It is highly unlikely Macron can deal with the something in the region of 20% gap with Germany and the euro as a common currency requires a transfer union which the Germans will never agree. Macron is on a hiding to nothing because his strategy only is deliverable if he is German and he is not. Germany will continue playing the euro along as long as possible because the alternative is a new DMk and a new currency valuation significantly upwards which will damage it. How long will the EZ continue subsidising Germany whilst economic malaise continues is the question and Italy may answer that before France does. Without the Euro Schengen is pointless, without Schengen costs rise 2%. The EU has become a geopolitical objective detached from the economic framework and needs radical reform which is almost certainly not deliverable due to the voting structure. To return to France, it cannot afford to crash out of the euro because of the currency devaluation that would occur and it cannot prosper in the euro because the reform required is too much to cope with at the ballot box. Marcon will follow the forgettable Hollande's popularity trajectory and is already ahead of Holland on the down slope. Quite an achievement.
- jagjeet sinha Oct 5, 2017
  
  Brilliantly summarized, Steve.
  Vichy-washy France will again need Full English breakfast AfDer sauerkraut.
  The Montreal Model perhaps the Model for Macron - Salvation@Anglosphere.
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Emanuel Müller Oct 4, 2017

Juncker's speech was very moderate and consensus seeking, Macron's speech was more passionate, with the reaffirmation of european endo-universalism, in other words that europeans taken together are a universal humanity, complete and self-sufficient, the reaffirmation of the ethno-cultural european identity, with every true european defined as the ones that recognize themselves in the profiles of the greek temples and the face of the Mona Lisa, and the reaffirmation of the european destiny as a central super-power in the making, with the responsibility to balance and counter-balance if not dominate overtly at the extreme orient China, and at the extreme occident the USA. This potential rise to ultimate central super power status seems to . be described historically as a three step process, first the greek rise to the light of rationality and democracy, than the renaissance with e.g. Da Vinci and his Mona as the prototypal technologist and as the third step, Macron the great unifier, armed with his esprit de conquete has to fuse the germanic, latin and slavic tribes into the true brain of a future world civilization that accepts the causal closure of matter and the logical impossibility of free will as a reality and therefore assumes the responsibility of being the inheritor of the genome that brought the light and truth of radical materialism to the world.
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Chiméra francouzsko-německé reformy

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