Main focus of Wednesday, June 27, 2012

Van Rompuy wants reform of the Eurozone

Van Rompuy expects a "clear and concrete" signal from EU summit. (© AP/dapd)

European Council President Herman Van Rompuy on Tuesday presented a plan for the construction of a fiscal union, according to which the euro countries would assume joint liability for their debts and transfer more competences to the EU. Some commentators describe the proposal as a silent putsch against the nation states that Berlin will not go along with. Others welcome the planned reforms as a minor revolution.

Van Rompuy's reform castrates nation states

Ahead of the summit in Brussels planned for Thursday and Friday, leading representatives from the EU and the ECB have drawn up a reform paper that paves the way for deeper integration of the Union under the aegis of EU Council President Herman Van Rompuy. The business paper Hospodárske noviny is less than enthusiastic about the idea: "What is being born in Brussels is by no means an inevitable reform. It is a silent coup that will castrate the nation states. In the context of the crisis, the EU is turning into a political union ruled by Germany. … The proponents of this course of action argue that integration is imperative, otherwise the Union won't survive. But if this Union explodes one day it will be because it's unnatural, artificial and centralised. And because it lacks the support of the people. This means the Union is basically an illegal construction." (27/06/2012)

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No debt mutualisation with Merkel

German Chancellor Angela Merkel will hardly agree to a future mutualisation of Europe's debts, writes blogger Charlemagne on the website of the liberal-conservative weekly The Economist: "Mr Van Rompuy's report does not pretend to be a 'roadmap' to greater fiscal federalism. It is, instead, a proposal to talk about one. European officials argue that just getting Mrs Merkel to agree in principle to discuss things like the mutualisation of debt would be a big achievement, as would getting the French to talk about surrendering the powers of the Fifth Republic. Yet talking is one thing, agreeing quite another - and there is still no sign of accord among leaders." (26/06/2012)

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Merkel treating Greece like a punching bag

German Chancellor Angela Merkel has rejected proposals to pool Europe's debt with drastic words. There will be no joint liability in Europe "as long as I live", she said at a meeting on Tuesday. The left-liberal business paper Imerisia expresses annoyance at the Germans' unbending stance: "What a Europe! Instead of taking serious action and making joint decisions based on compromise the political leaders are engaging in an ineffectual and dangerous contest to see who can produce the worst cacophony. … The main protagonists are the Germans. They are peerless in their intolerance, their attacks go way beyond well-intentioned criticism and every agreement between partners is broken. All this is mainly done to impress the voters; because apparently the campaign for next year's parliamentary election has unofficially already begun. As harsh as it may sound, Greece of all countries is practically being treated like a punching bag."  (26/06/2012)

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Eurozone reconstruction a step out of the crisis

The proposals by European Council President Herman Van Rompuy on the construction of a genuine fiscal union are cause for hope, writes the left-liberal daily De Morgen: "This may not be the ultimate coup that will catapult Europe out of the crisis. But it can mean a big step in the right direction. It would be nothing less than a minor revolution for Europe to be able to decide for itself in future how much a country may spend per year and force member states to adjust their budgets accordingly. In the long term a true budgetary union will even require a sort of European finance ministry. And it's only logical to set up a sole authority to supervise several thousand European banks at the same time. Because if at the end of the day the EU has to pay the piper, it might as well start calling the tune right now." (27/06/2012)

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