Friday, January 15, 2010

Open Europe press summary: 15 January 2009

Former German President Roman Herzog: "The EU harms the European ideal"
In an article for FAZ under the headline "the EU harms the European ideal", former German President Roman Herzog writes that the EU faces an "existential crisis". He argues that the EU "must regain the public's trust....otherwise they will reject the founding ideal of European integration, which would make the complete dissolution of the EU a possibility."  
He notes that the overarching impression is that Brussels "decrees over people's heads, over traditions and cultures, and regulates things that could be regulated far more effectively on a national level".
He criticises EU over-regulation and calls for the 27 member states to emphatically reject Brussels' interference in national jurisdiction. Amongst his examples of "grotesque" EU over-regulation, he cites the Commission's decision to make benefits available to single women in Germany, a regulation that was heavily contested by the German government but ultimately overruled. Herzog suggests that this flouts the subsidiarity principle, which states that the EU can only interfere in national jurisdiction during an irresolvable cross border issue. Herzog argues, "National governments must establish a culture of categorically saying 'no' to EU legislation which jars with the subsidiarity principle."
Herzog notes that as it is in the interest of both the EU judicial system and the European Parliament to broaden EU power, "increased vigilance from member states - in politics, the public and the media - is essential".
Meanwhile, the Economist's Charlemagne blog argues: "I think much closer [EU] integration will not work, and after five years in Brussels, talking endlessly to politicians, officials, diplomats, think-tankers and the like, I am convinced I sense no mood out there for much deeper integration. And when I say the current system is not working well, it is not Brussels-bashing for the sake of it. I am a European, it pains me to see my continent falling behind. But there it is. I cannot pretend the emperor is wearing lovely robes. I cannot say I think the European Parliament can be fixed with lots of new powers, because I go there, and see a place that has gained huge amounts of new power in recent years, but remains dominated by mediocrities, and just as obsessed with gaining new powers as ever."
FAZ Economist: Charlemagne blog
Charlemagne on the Lisbon Treaty: National leaders had no real idea what they were signing
The Charlemagne column looks at the Citizens' Initiative, introduced by the Lisbon Treaty, and argues, "Euro-cheerleaders spent years banging on about the need for Lisbon, saying its new rules would make Europe simpler, more efficient and more democratic. Now they have the treaty, many of the same people are muttering and wailing about unresolved problems hidden in its leaden prose. Interview senior Brussels types about Lisbon, and the same phrases come up again and again: 'we have no idea how this bit will work' and 'of course, national leaders had no real idea what they were signing.'"

Meanwhile, Spanish Deputy Prime Minister María Fernández, whose country holds the rotating EU Presidency, has said that "The Lisbon Treaty has made the EU decision making process more complex", according to Belgian daily De Tijd.
Economist: Charlemagne Tijd

ECJ says UK's decision to freeze benefits for families of terror suspects is in violation of human rights
The Telegraph reports that the wives and families of suspected terrorists could soon have their benefit payments reinstated, following opinions expressed by the European Court of Justice (ECJ)'s most senior judge. The Mail notes that Ministers stopped the handouts following the September 11 attacks and that, under the Treasury's rules, social security payments cannot be made available 'directly or indirectly, to, or for the benefit of' anyone who is on the UN terrorism sanctions list.

However, the Senior Advocate of the European Court of Justice, Paulo Mengozzi, has said that the decision to halt the payments was unfair on the grounds of human rights. The ECJ is due to consider three test cases, brought by the wives of British based terror suspects later this year, at which Mr Mengozzi's observations are likely to prove crucial. Any decision by the European Court, which is expected to issue a final judgment in three to six months, will be binding on the House of Lords and on courts throughout the EU.

Mail Telegraph Reuters
Lord Mandelson: We need to "push back" against "regulatory grandstanding"
At a speech yesterday Business Secretary Lord Mandelson said, "Some, as we have seen, in the European Parliament will interpret the banking crisis as a clarion call for more business regulation in general - we need to push back against this intelligently...We do not need regulatory grandstanding - we need regulatory coherence, joined up between jurisdictions. We do not need multiple, cumulative layers of regulation that amount to overkill."
He also said that he thought the AIFM Directive on hedge funds and private equity firms was "badly flawed". He added that efforts to secure an overhaul of the Directive, which he said "read more like a long-standing grudge against the hedge fund industry than a serious attempt to address systemic risk", were continuing and that "British influence has been brought to bear". Lord Mandelson also said it did not make sense for the UK to "detach" itself from a single EU regulatory regime.
The FT notes that, at his European Parliament hearing, Mr Barnier "ducked" a question on whether he regarded a single European "super-regulator" as a good idea, saying: "I don't think there's a single model".
Meanwhile, the WSJ reports that a new paper from the OECD argues that the Basel capital-adequacy regime allowed banks to conceal their riskiest assets, and that a leverage ratio should be the central measure of banks' capital in the future. The article notes it is "likely to be mighty unpopular in France and some other places in continental Europe, where it would paint national banks in an unfavorable light and force them into raising large amounts of capital."
WSJ: Fidler Independent FT: Lex Open Europe research
Danish Liberal MEP says he is 99% sure EU Commission will not be approved
EUobserver reports that European Parliament President Jerzy Buzek has sent a letter to European Commission President, Jose Manuel Barroso, asking for clarifications on the Bulgarian Commissioner Designate Rumiana Jeleva. It also reports that the Bulgarian government will announce that Ms Jeleva did not break Bulgarian law in failing to declare her stake in Global Consult when she became an MEP in 2007, as revealed by New Europe. Danish Liberal MEP Jens Rohde told Berlingske Tidene "with 99 percent certainty" that the EU Commission currently being proposed will fall, noting that the liberal ALDE group has decided not to back Ms Jeleva.
On his FT blog Tony Barber argues that, the "only thing worse" than a delay in the EP vote approving the European Commission, because of the dispute over Ms. Jeleva, "would be the appointment of a commissioner several grades below the standard required."
The FT reports that Germany's nominee for the Energy Commissioner Günther Oettinger said yesterday that "If the Copenhagen summit showed us one thing, it is that the European Union isn't big enough for world authority when it comes to countries like China."
Meanwhile, Dutch News reports that Dutch Commissioner Designate Neelie Kroes' performance at her European Parliament hearing has been described as weak by Socialist and Christian Democrat MEPs. Commentators have suggested that the resistance to her appointment is a political move, because several Christian Democrats and one Socialist candidate have already been given a rough ride by the European Parliament. NOS TV reports that there is an expectation that some candidates will now get different jobs. "The horse trading has begun," one Liberal MEP told the broadcaster. Trouw reports Kroes needs to face MEPs again next week.
EUobserver EUobserver 2 Economist New Europe Die Zeit Stern ORF Financial Times Deutschland Spiegel European Voice Dutch News NOS Trouw Berlingske Tidene FT: Brussels blog FT Tagesspiegel Spiegel Tagesshau Bild Deutsche Welle Die Welt FAZ
MEPs may use Lisbon Treaty rules to derail EU-South Korea trade deal
EUobserver reports that speculation is growing that the European Parliament is set to use its new powers under the Lisbon Treaty to disrupt ratification of the EU's new trade deal with South Korea. The article notes that "the deal has been heralded for its potentially huge savings due to tariff reductions" but that European small car manufacturers fear greater levels of South Korean imports will reduce their sales.
Some fear that the Parliament's new trade powers mean it will inevitably become the target of increased lobbying, hampering the EU's ability to complete trade agreements. "It would be very disturbing if the first thing the European Parliament does with its new powers is to take special interests to heart and increasingly act in a protectionist way," said Swedish centre-right MEP Christofer Fjellner. The Lisbon Treaty hands MEPs an equal say with member states over the deal's final ratification, meaning they could block the deal.
Greece promises to bring budget deficit to below 3% GDP by end of 2012;
Trichet refuses any "special treatment"
Greece's government approved the country's economic recovery plan yesterday, which pledges to reduce its budget deficit to 2.8% of GDP by the end of 2012, from an estimated 12.7% of GDP in 2009, and warned it could introduce additional taxes and spending cuts if necessary. Finance Minister George Papaconstantinou said the plan will be submitted to the EU and the European Central Bank for approval today, and that there was "no question" of the document being rejected, reports the Guardian.
The WSJ reports that ECB President Jean-Claude Trichet indicated yesterday that it is not prepared to grant Greece special treatment to help the country in its economic turmoil, saying: "No government or state can expect from us any special treatment".
At the moment, Greek commercial banks - heavy owners of Greek sovereign debt -use government bonds as collateral to obtain inexpensive ECB credit. However, the ECB is due to go back to its old collateral policy at year-end, which means that if Greek government debt is downgraded further it risks becoming ineligible as ECB collateral. "We will not change our collateral framework for the sake of any individual country", Mr. Trichet said. He also added that the idea that Greece would leave the eurozone was "absurd". Writing in the Irish Times Pat McArdle argues that "EMU is like the roach motel; you can check in but you can't check out. Moreover, any bills incurred while in residence must be settled promptly."
Speaking at the LSE last night, Swedish Finance Minister Anders Borg said that Greece's high deficit, and inaccurate data on it given to the Commission, was "completely unacceptable". He added that there would be an ECOFIN meeting on Tuesday to discuss Greece's multi-annual plan to tackle its deficit, and said that "eventually they will have to restore credibility with their acts [rather than words]".
WSJ Guardian European Voice EUobserver FT WSJ: Editorial FT: Tilford Irish Times Die Welt  Comment is Free: Weisbrot
Zapatero signals that EU may take Obama's lead on levy for failed banks
The Times reports that US President Barack Obama's plan for a levy on banks that were bailed out by the taxpayer are likely to hit UK financial institutions with operations in the US with a $10bn bill. The Telegraph notes that European governments could be tempted to follow Obama's lead, while Spanish daily El Pais reports that Spanish PM Jose Luis Zapatero, who goes to Washington in February ahead of the EU-US summit, has said that Obama's proposal "is very interesting" and he is prepared "to open a debate in the EU about a similar initiative".
Times Telegraph El Pais
EU Competition Commissioner chides French "economic nationalism" over Renault
The FT reports that the EU's outgoing Competition Commissioner Neelie Kroes yesterday demanded an explanation from the French government about its pressure on the Renault carmaker to site its Clio production facilities in France rather than Turkey. Kroes said, "Economic nationalism risks setting off a spiral of retaliation." The article notes that Christian Estrosi, French Industry Minister, struck a defiant tone, saying that the state was considering raising its stake in Renault to have a greater say in the company's decision making.
FT European Voice
The Telegraph reports that Edward McMillan-Scott, the MEP expelled from the Conservative Party over his remarks about the party's new alliance in the European Parliament, has announced he will launch a High Court legal case against his expulsion.
In the Express, Frederick Forsyth argues that David Cameron and George Osborne should look at the costs imposed on the UK economy by EU membership in their bid to reduce the UK's debts.
No link
EU full-time President Herman Van Rompuy has started his first European tour this week in Berlin. Euractiv notes that he remarked: "Nobody should feel obliged to be excited about it."

Les Echos notes that French diplomats are backing Luxembourg PM Jean-Claude Juncker's reappointment as head of the Eurogroup, but notes that "Christine Lagarde has been very clear. The demand was to have an ambitious programme." The article suggests that this presents France with the opportunity to push its aim of a system of "economic governance" for the eurozone.
Les Echos

El País reports that during Spanish PM Jose Luis Zapatero's visits to Austria and Slovakia yesterday he "maintained his intention that the EU take measures against countries which do not fulfil the conditions to be set by the EU 2020 strategy to leave the crisis". The paper notes that Zapatero spoke of "incentives, corrections and even sanctions".
Telegraph El País El Pais 2 El País 3
Writing for the Times, Roger Boyes notes that Bosnia-Herzegovina will be the top priority and a major challenge for EU Foreign Minster Baroness Ashton.
Times: Boyes EUobserver
In the FT, Martin Wolf argues that the UK and the Netherlands should end their "self-righteous bullying" of Iceland over the Icesave dispute.
FT: Wolf
Euractiv notes that Yulia Tymoshenko, Ukraine's Prime Minister, has promised that her country will become an EU member if she is elected President in February.
European Voice reports that the battle over measures to conserve stocks of bluefin tuna in European waters has flared up once more in the European Commission, with departments sharply divided over whether the fish should be subject to a temporary trade ban.
European Voice

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