Friday 25 November 2011

Re:New Conference in Brussels - Renewal for the European left?

The plight of the European left is well known by now: despite the victory in Denmark a few months ago, the left has lost Spain, and now doesn't hold any of the 6 major Member States (the big 3 plus Italy, Spain and Poland). So does it have the ability to fight back and put forward a viable alternative political vision? The Party of European Socialists are holding a Re:New conference in Brussels (25th-26th November), with NGOs and Trade Union representatives present as well as activitists.

First of all, the PES have decided on their primaries for selecting their Commission President candidate for the next European elections (PDF; Ralf Grahn has already commented on this here). A good step for European democracy, as PES are now committed to fielding a candidate, whereas they failed to providean alternative to Barroso in 2009. However, it is still left to national political parties to decide wheather they will hold a direct vote with their members or indirectly consult them. This could have a big effect as the envisaged proportional voting (that the votes per member party are distributed proportionally among candidates rather than a first past the post system where candidates could win all the votes of a national party at the PES level) could be undermined if few parties adopt direct votes. Political pressure through example by more democratic parties seems to be the hope behind this compromise. Still, it commits the PES to a more European campaign centred around winning power in the Commission.

So does there seem to be a PES alternative to the European EPP majority?

Probably not, if you consider a proper alternative to be a coherent policy platform. Though the PES seems to be fairly united around Eurobonds and the financial transaction tax (although UK Labour's Emma Reynolds looked a bit uncomfortable as she defended the Conservative-led government's position that an FTT would have to be global as the Labour party's own position), there doesn't seem to be a fully thought through programme yet. Added to this difficulty is the leftwards drift of the EPP (which can be seen by Barroso's SOTEU speech and the increasing promotion of Eurobonds and FTTs in right-wing circles). While the PES can berate the EPP and "Merkozy" for being too little, too late at every turn, it does not make up for the lack of a concrete plan. Not that the EPP has a plan, but if the left wants to well, it has to earn it rather than hope to profit from anti-incumbant votes.

The first workshop I attended was "Progressive Policy Responses to the Crisis". Apart from Eurobonds and FTT, barely any policy was mentioned. The failings of the right and the need for closer European integration were highlighted, but a lot of the hope for the left seems to be based on the French and German elections even though there's a recognition that the crisis is so urgent that key political questions need to be addressed quickly. Implicitly this means that it's up to a leftwing Merkozy, replacing our conservative one, to help solve the crisis, rather than attempt to provide a European leftwing platform in the meantime (and after all, what better time is there for the PES to articulate a vision if not when the left is in opposition and Europe is on everyone's lips?).

In terms of immediate policy, the only relevant contribution was from Walter Cerfada, who put forward 3 chages for the next EU budget: 1. that structural funds should be made available to the economically weaker nations without the requirements for co-funding when the money does not exist at a national level; 2. that this budget plans for the 2013 budget too so governments can make longer-term plans; 3. that the European Investment Bank quickly starts to invest more.

The audience very quickly picked up on the lack of policy content and a very challenging question was posed: if the PES has little power within the EU institutions, why don't the PES Commissioners resign in protest at EPP policies? There wasn't really an answer. If PES leave the Commission, then it would mean something else for their Commission presidential campaign too: that the PES would believe that the Commission should be politically coherent (and closer to the EP), not just the Commission President.

George Papandreou was actually one of the best speakers at the conference so far. The PES seem to be good at generating vision, but has problems communicating that vision nationally, and putting together practical policies (at least as far as I can tell from this conference so far). Is this a problem of organisation - is the PES too national? What organisational developments are needed or are taking place to make the PES more effective? Hopefully I can find out some more over the next day.

Thursday 10 November 2011

BBC Radio Four: Britain and the Human Rights Act

The Human Rights Act 1998, which transposes the European Convention on Human Rights into UK law, is controversal in British politics: the Liberal Democrats and Labour are for the HRA, while the Conservatives are against. The Conservatives want to bring in a British Bill of Rights, but it has never been spelt out what this means in practical terms. Will it contain less rights than the ECHR? More? Would the UK leave the ECHR (and therefore the Council of Europe - which only junta Greece has ever done)?

BBC Radio Four has produced an interesting programme this week on Britain and Human Rights, and what the practical legal implications of moves to change it are. You can listen to it here.

If the link doesn't work, try looking the programme up on the BBC Radio Four website - though you have to be in the UK to use the iPlayer, but I've been able to listen to BBC radio programmes through their websites from outside the UK before.

Wednesday 9 November 2011

Cardiff's Controversal Court of Auditors nomination

Last week the Irish Department of Finance discovered that it had counted the money borrowed by the Housing Finance Agency, leading it to overstate the Irish Government's debt by €3.6 billion. The Secretary General, Kevin Cardiff was called before a parliamentary committee to account for the mistake, but the controversy has rumbled on since Cardiff has been named as the government's nominee to the EU's Court of Auditors, which oversees the EU's budget.

Cardiff's departure is being explained in a few ways:

"The Fine Gael-Labour coalition made little secret of its desire to move those associated with the 2008 bank guarantee into different roles. [Note: He was in office at the time]. Mr Cariff’s appointment not only frees up the most senior post in the department, but also replaces a Fianna Fáil nominee at the court of auditors.


In Government circles, it had been widely anticipated the post would go to a political nominee from either Fine Gael or Labour. The speculation in Dublin was that the party, which did not receive a Luxembourg post, would have a claim on Ireland’s seat in the European Commission when next it falls vacant.

Sources familiar with the deliberations in Dublin said it was far too early in the life of the Government to consider appointing any Minister to the post. Given that the nomination is subject to the approval of MEPs, the Government was keen to nominate a figure with a financial background."

Cardiff has countered the criticism leveled at him by opposition TDs that he is unfit to take the CoA job considering the accounting mistake made under his watch:

"In his response to her direct criticism, Mr Cardiff said that as accounting officer he accepted responsibility and would act on the error to ensure it would not happen again. “If an accounting officer were to resign every time there was an error you would have no accounting officer. If they were to resign after every major error you would only have lucky accounting officers left,” he said."

However, it's not just the opposition that's exercised by the nomination, MEPs from the junior coalition party have spoken out against his appointment, as has UKIP MEP Marta Andreasen:

"Former chief accountant of the European Commission Marta Andreasen spoke out against the Irish Government and Mr Noonan yesterday for their support for Mr Cardiff. The UK Independence Party MEP said the Government was behaving irresponsibly by backing someone whom she believes is unfit for the European job."

It will be interesting to see how closely the Budget Control Committee will examine his record tomorrow.

Democracy and the Eurozone Crisis

There will no longer be any referendum in Greece on the new Eurozone deal, and a technocratic-led national unity government will take over before elections can be held in February. (And a good thing that there will be elections - Greece needs to confront its economic future in a way that the Greek people will buy into the responsibility of the decisions that need to be taken). Now that the referendum has been called off, it's taken as a indictment of Europe that France and Germany could pressure Greece to drop the referendum by saying that the money will be withheld unless a referendum would return a positive result.

This is a very strange argument. Surely it wouldn't be taking Greek sovereignty and democracy seriously if the Eurozone continued to loan Greece money and expect them to implement austerity measures regardless of any referendum they held? And the implication that the Eurozone should be willing to loan money to Greece regardless of Greece's commitment to any deal suggests that the rest off the Eurozone deserves less of a say. While a partial default within a Eurozone deal or a total default outside any Eurozone loans isn't an attractive choice, Greece cannot change that choice by elections or referendums: democracy is when people come together to decide what to do in the situation in which they find themselves. Sadly, for Greece and the rest of the Eurozone there are no good options.

Fintan O'Toole has an article in The Irish Times about the disconnect between capitalism and democracy:

"And this isn’t just a simple matter of the Merkozy monster lording it over us little PIGS. For at this historic moment, even the German chancellor is little more than a cipher. She’s caught in the democratic crisis too. Remember this time last year when Angela Merkel started to make noises about bondholders sharing the pain of rescuing the banking system? She had to back down very quickly and make it clear that she didn’t mean present bondholders – heaven forbid. Even the German chancellor isn’t allowed to say certain things."

I don't entirely agree with him, but I do think that markets and globalisation has grown and proceeded to such and extent that it benefits us to make some market and economic decisions collectively in the EU. Yet the EU, despite the almost co-equal power of the European Parliament, has a huge democratic disconnect. With the Treaties unequipped to deal with the Eurozone crisis, the approach to solving it has been intergovernmental, which has caused tensions between small Member States and non-Eurozone states who have the most to loose politically from governing the Eruozone from the Eruopean Council, and big Eurozone Member States (primarily France and Germany) who are better placed to have the most influence.

It might take ages to finalise a new treaty to equip the EU institutions to better deal with fiscal union issues, but it is most likely to be produced after the major crises are solved (or stabilised, if we're lucky enough). European issues have never been so widely discussed in Europe than they are now: since the Euro and the future of the EU is such a major issue, and the European Parliament has gained more powers since the last election in 2009, it might be worth having another European election. It would provide an opportunity to involve citizens more directly in the debate over what needs to be done and can also focus on the Parliament's new power. Though the EP isn't in a prime position over the EFSF or future fiscal union, an election would give the Parliament (and the Europarties) a stronger mandate in their proposals, and could be a useful way of gauging (informed) public opinion before embarking on further treaty change.

Monday 7 November 2011

European Faultlines

Last year I blogged about the European outlook of the Dutch government. With the Eurozone crisis still rumbling on, some of the faultline themes are well established: the degree of fiscal union and the role of the ECB, the core versus the perciphery, austerity versus stimulus, Eurozone members versus non-Eurozone members, etc. Apart from the left-right question of austerity versus stimulus, most of the major questions are about integration and institutions: how much do we integrate, how do we integrate, and what will be the consequences of integration. So a lot of the old instutitional debates are being revived in the background.

First, intergovernmentalism and supranationalism remains a big question. The influence of France and Germany in the crisis is obvious, and in some ways justified given the financial commitment they are making on behalf of their citizens, but it does means that the debate on the solutions to the crisis are incredibly narrow. It may be better for Greece to remain in the Eurozone deal despite the devestating effects of austerity than to default and bring in an automatic and deeper austerity as the Greek government fails to be able to finance its government spending. However it's not necessarily the best policy for Greece or for the Eurozone: yet it remains up to discussions in certain Member States to come to that conclusion before anything changes rather than an open pan-Eurozone debate permitting a more dynamic an informed action. This is particularly the case as the deepening crisis in Italy and elsewhere is connected to the need for recapitalising and reforming Europe's banking and financial sector.

The European Council has gone some way to tackling this crisis, but the constant summits has meant that the Commission and Parliament are being sidelined. Since the treaties don't really provide for the EFSF (and the EFSF is probably contrary to the treaties, but sovereign states are quite practised at rewriting the rules), the Commission and Parliament are very limited in what they can do. But it would be a mistake to think that only the Commission and Parliament want more power for themselves: it is in the interest of many Member States for treaty changes to transfer powers to the Union more properly to deal with these crises. For small Member States, majority voting and a strong Parliament and Commission are safeguards against the overpowering influence of the big Member States, while for non-Eurozone Member States, it is better to anchor the Eurozone within the wider EU in order to prevent a core Eurozone from driving internal market and other policy. This level of integration would require a new treaty with sufficient fiscal and political union elements to work - if the institutions can't deal with the crisis even with a treaty change, then the European Council, dominated by the big Member States, would again step in.

Second, the European Council as an institution is asserting itself over the Commission, in a way that has similar big-versus-small states implications, as well as challenging the newly empowered Parliament. (We're lucky that Tony Blair didn't get the European Council Presidency) The Commission and Parliament will probably continue to grow closer together (or, the Commission will try to co-opt the Parliament in its battle with the Council, while the Parliament tries to co-opt the Commission in its battle with the Council).

Third, there is the Eurozone/Non-Eurozone divide. It's not a clear divide between those states, but a divide on whether or not to include them and how far to include them. The fear is that closer integration within the Eurozone will mean that non-Eurozone countries will have less say within the EU generally, as Eurozone countries co-ordinate more. Ireland, the Netherlands and Finland want to include the rest of the EU as much as possible: for the Netherlands and Ireland this is about including more free market-orientated countries, but it's also about diluting the influence of France and Germany and strengthening the position of the small states. For non-Eurozone countries to secure the position, it would be better to ensure that new institutional changes are committed to the treaties in a way that limits the consequences of the change to the Eurozone as much as possible (though multispeed Europe will mean that some Member States will end up with more political say than others). As long as the changes are reached ad hoc through the European Council and the Eurozone Group, the more exclusive the decision making will remain.

However the UK may be the spanner in the works. While ensuring the position of the non-Eurozone members means that the focus on treaty change should be on limiting the scope for Eurozone decisions to affect the internal market without some general EU involvement, the UK moves to gain further opt-outs could push Eurozone members to make any new treaty Eurozone-only. The UK may find that it cannot count on non-Eurozone countries for support in getting new opt-outs if they feel it could damage their chances of securing their positions in the EU.

The Irish Finance minister has given a speech at the IIEA last week outlining some of the Irish positions on the EU and the Eurozone which reflect some of these faultlines:

Friday 4 November 2011

Irish President Michael D

Last week Ireland elected its ninth president. Though the role is highly ceremonial, the election campaign was hard fought between 7 candidates: the widest choice in the office's history. At the end of the count, Michael D,* an academic, poet, and long-time elected politician, became the first "political millionaire", with over a million votes. He has a strong track record on fighting for human rights, and is a great orator.

Here's his acceptance speech (skip to 3:00 if you want to leave out the Irish language part and the thank yous):

As a resident of Northern Ireland, I didn't have a vote in the election (extending the franchise north of the border and to the Irish abroad will probably be considered as part of the political and constitutional reform agenda in Ireland). However, over the last 21 years the presidency has allowed Ireland to redefine itself and its identity in a very positive way - in terms of inclusion and the peace process - and Michael D clearly aims to continue this from his platform of inclusive and active citizenship. While people and the media complain that the post has little power, it's highly political role (despite being removed from daily politics and policy) that offers a powerful way for citizens to engage in what their identity is and what their republic means to them. Which is why I think this right to elect the head of state is an important and positive thing, why I take monarchists' claims of unity and symbolism with a certain amount of scepticism, and I look forward to Michael D's presidency.

* He will probably be called Michael Higgins/President Higgins abroad, but he's known by his middle initial in Ireland. What it stands for is a popular pub quiz question (Daniel, if you're wondering).

Wednesday 2 November 2011

Papandreou's Gamble: a tale of two defaults

It's clear that Papandreou's decision to hold a referendum on the latest Eurozone agreement, without even informing his cabinet of his decision, is a massive political gamble to restore his authority. The further reduction of the government's parliamentary majority, and the firing of the entire chiefs of staff reveal the instability of the government.

On the European level the problem with the referendum is not so much that people are being given a say - though there are probably elements that argue that, there needs to be a democratic buy-in of the Greek people into any plan for it to work properly - rather that it crystalises the issue. When presented with the referendum the Greek people will be asked to say yes or no to the deal: a yes would mean buying into the process so far and imply support for however it evolves; a no would mean the end to the loans, complete default (along with the instant austerity that the inability to fund the deficit implies) and probable exit of the Eurozone.

While this could be a clever move by Papandreou to bounce the electorate into supporting the government in a choice between two defaults, for the Eurozone it raises the spectre of a non-negotiatable stance, and a toxic debt fallout that will force a decision over Italy. Though Greece probably needs more haircuts over time and a plan for growth so it can service its remaining debts and rebuild its economy, this slow evolution of the Greek Crisis (though not necessarily inevitably moving in that direction) has been short-circuited by the referendum announcement. A "No" would mean that Greece would be dropped so the Eurozone could deal with Italy.

There has to be a real buy-in by the Greek people in the solution to the crisis: with all the strikes and the uncollected taxes, Greece can't recover unless there is a majority for reforming the state and the economy. With, as EUObserver reports:

"Polls over the weekend put Greek popular opposition to the new EU deal at 60 percent and the viability of the government is under threat from rolling general strikes and frequently violent protests that reach almost every quarter of the country.

At the same, polls put support for retention of the euro at 70 percent."

the binary choice of default within or outside the Eurozone might pass, and offer the Greek public to decide whether or not they want to be part of the Eurozone deal - and how much they want to be part of the Eurozone. But in the absence of a real debate about other options - however workable - that a parliamentary election might allow (essentially forcing the government and opposition to set out their alternatives), it's hard to see how much a "yes" vote would signal acceptance of the Eurozone's direction, and how much it would constitute a democratic buy-in by the Greek people.

It may turn out to be a masterstroke by Papandreou: giving the people a greater say and building a wider consensus in society, or it could backfire, either as a No, or as a Yes with no real substance to it. In any case, the Greek people are caught in a tale of two defaults, with an unenviable decision.

Edit: While I'm slightly sceptical of the referendum because of its limited choice, Polscieu has written a great post in favour of it.