Tag Archives: European Commission

“We Told You So”: How U.S. economists predicted the Euro Crisis

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UPDATE: The original version of this post was lost following a hacking attempt on this website. New security and daily backups are in place so with any luck this will no longer be a problem in the future. It has been republished with some modifications. Reactions to the original piece have been lost.

…we have not been able to find any US economist making a strong case for the euro prior to its birth.

This is perhaps the most striking find in a fascinating survey by the European Commission of U.S. economists’ assessments of the coming of the euro, as expressed in some 170 publications. The document is enlightening in two respects: first as an intellectual history of American economic thought on the euro, an “American interpretation” which in fact still predominates, and second as an X-ray into the “Eurocratic mind” and its attempts to explain away criticism of the euro. Every self-styled EU-expert should probably read it or, failing that, this post, which summarizes and provides extracts of its 50-odd pages. Continue reading →

Who really runs the EU?

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The Berlaymont – EU Commission headquarters. The kinds of faceless offices where many imagine “Brussels” decides things.

UPDATE: This post was originally published on 19/07/2012. It has been republished as the original was lost following a hacking attempt on this website. New security and daily backups are in place so with any luck this will no longer be a problem in the future. Reactions to the original piece have been lost.

This post was prompted by a little debate I had on Twitter with my fellow euro-bloggers Ronny Patz and Jon Worth. The question being: What is the most powerful EU institution?

In particular, I had criticized Der Spiegel for suggesting in a profile piece on European Commission President José Manuel Barroso that he “has been the head of the most powerful EU institution for eight years.” The statement, I felt, was deeply misleading. In my experience, both the European Council (representing national governments) and the European Central Bank are infinitely more powerful. It prompted these exchanges with Jon and Ronny:

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EU’s new wish-fulfilment video: Commission’s endless paperwork creates scifi Utopia

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We all remember the adventures of Euro-Clooney and other assorted metrosexual Europeans in the “Innovation Union”. The good people at DG Communication have decided to top that with this video which I am almost at a loss to qualify. I can only suppose that this is what a competent video producer imagines to be a bureaucrat’s wet dream. Watch for yourself.

Done? Good.

Our frustrated Europeans are stuck in traffic, face flight delays or have to deal with late arrivals of cargo. But never fear, the Eurocracy is here! It has helpfully produced a White Paper on Transport whose endless pages fly out of the window – our Europeans gazing at the flocks of paperwork with joy and wonder – before magically turning into futuristic trains, airports and cars. And so, our Europeans were saved from wasting time due to congestion and delays. And everyone was happy. The end.

Well, if Commission officials have that kind of power and effectiveness, their job satisfaction must be off the scales.

The reason for this little indulgence in unadulterated fantasy is the recent publication of the Commission’s White Paper on Transport. Pleasantly short at 30 pages, it is your typical, run-of-the-mill, lowest common denominator non-paper, a flaccid compromise between the various conflicting and/or status quo business and governmental interests.

While it has some misleading headline-grabbing points, including a goal for no conventionally-fuelled cars in cities by 2050 (e.g. only electric, natural gas and hybrids), it is painfully thin on commitments. A very ambitious target to reduce carbon emissions in transport is quietly pushed as far into the future as possible, that is a 60% reduction by 2050 compared to 1990. Meanwhile no reduction relative to 1990 is projected even up to 2030! Environmental NGOs predictably panned the document.

The European Commission is not the Soviet Gosplan. It can’t dictate what people should do or create anything with a snap of its fingers. It can coordinate, legislate, encourage but for the most part this means just producing lots of paper and wind (hence the unselfconsciously ironic hilariousness of the video).

Ultimately the Commission, in and of itself, cannot make these things a reality and it shouldn’t pretend to. It leads to confused responsibility. The EU has a limited budget, a few tens of billions of Euros legitimately going to transport, but not much else. It is ultimately business, national governments and even regional authorities which might be able to set us on the right track (and if things go to hell in transport, we should mostly blame them). I would wish the EU could be more understated.

PS: And thanks to one particularly helpful comment on YouTube I now know what the Venus Project is.

“Like watching the EU Commission’s Midday Briefing with all the verbs missing”

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Generally speaking, the EU’s aesthetics comes in two varieties: 1) soulless technocracy (when it tries to be mature and legitimate, think shiny window panes and lots of grey) 2) postmodern kitsch (when it tries to be young and hip). The WSJ’s blog humorously points to an expensive-looking recent ad which has successfully managed to combined these two tendencies into one mystifying “Euro-pudding” promoting the “Innovation Union”. Best to read the original post and watch the two parts of the ad yourself.

The Commission’s website also has lots of other less obtuse videos highlighting specific technological innovations made across Europe in medicine, renewables and robotics. This is is not a bad thing. The American Right loves to portray the state of the European economy as something akin to the Soviet Union’s sclerotic poverty while politicians on both sides of the Atlantic, if they want to promote a given economic policy, will always cite something the Chinese are supposedly doing as a precedent. In all this you’d forget much of rural China still lives with something like African levels poverty or that Europe is one of the great poles of a largely tripolar world economy, along with North America and East Asia.

As such, Europe is at the forefront in domains like face transplants, mobile telephony (the GSM standard used by 80% of mobiles in the world comes from a French acronym (si, si, pour une fois…), and renewable energies. A little polishing of the European brand so people in Europe and abroad be more conscious of Europe’s economic and technological success is not a bad thing. That said, the Commission’s PR people haven’t found the best way of going about this…

On the Democratic Deficit: European Commission tells Greenpeace to Sod Off, Socialists to pick candidate for 2014

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The folks at Greenpeace can never be accused of a lack of voluntarism. The Lisbon Treaty, in one of its mostly weak attempts to improve democratic legitimacy, created provisions for a citizens’ petition: if 1 million signatures from around Europe for a given cause, then European Commission must take it into consideration and formally response. Sure enough, Greenpeace got those signatures very quickly for a ban on Genetically-Modified Organisms, mostly grown in the Americas. Such a petition cannot force the Commission to do anything beside “respond,” which could easily be a formal letter to activists telling them to sod off.

The Commission decided that even this would be too great a concession. Though the Lisbon treaty has been in force for over a year, the precise technical provisions for a legitimate petition have not been established (e.g., from how many Member-States the signatures should be from, with what minimum threshold..). As a result, the Commission has deemed the Greenpeace petition void. Our good save-the-Earthers have been told to start again from scratch.

EU politics remains largely impervious to popular participation or even actual partisanship. The Commission maintains the aura of a technocracy (although it is actually too underfunded and understaffed to have real expertise in many areas, relying on national and corporate officials) while the dealings of the Council remain more in the realm of diplomacy than of politics. Only the Parliament is slightly better, but its colorful assortment of radicals (postcommunists, Greens, big-C conservatives and secessionists) are largely overshadowed by the gray consensus politics of the big political groups, composed in large part of nameless hacks and semi-retired politicians.

It is hard to engage the public when having an actual political debate has been made structurally impossible. I think this is not an oversight but a feature of the European political system, the national politicians who created it being just as eager to insulate themselves from popular pressures as were America’s Founding Fathers. These sorts of petitions, while they can be dangerous, represent one of the few outlets for democratic participation.

I am more enthusiastic about the proposal of the Socialists to nominate a candidate for President of the Commission whom they would elect if they win the 2014 parliamentary elections. The leader of our Union, then, would actually have to campaign and be elected with a platform. Oh my, what a strange concept. I’m sure we all preferred waiting for the White Smoke so that European diplomats and politicians could emerge from a caffeine-fueled late-night negotiations to solemnly declare which uncharismatic non-entity they collectively found least disagreeable.

The Socialists’ platform incidentally includes a tax on financial transactions, a commitment not to cooperate with neofascists and the creation of a “Employment and Social Progress Pact” to counter the European Central Bank’s deflationary stability pact. Whether or not they are good ideas, they at least form the basis of a project which, for or against, would legitimately give European citizens a reason to turn out in 2014. In the absence of any discernible projects or actual intelligible politics, the continuous decline in turn for European elections has been an inevitable product of the system.

Don’t get your hopes up though. The Socialists’ potential candidacy so far has attracted little attention, whether from media or even national politicians, and they previously failed to settle on a candidate in 2009. Who could be the candidate? I don’t know enough about the center-left politics in other countries to really say. But someone over-ambitious, a “big politician” of international stature, preferably speaking French, German, English and – why not – Italian, would be nice.