Martin Schulz: Political, Left-wing and Federalist

Yesterday Martin Schulz, the President of the European Parliament, was announced to be the Party of European Socialists' candidate for the Commission Presidency.

So who is Martin Schulz? A former binder and book-shop owner, Schulz's only experience in political office outside of the European Parliament was at the local level as a councillor and then mayor of Wuerselen in Germany. He was elected to the European Parliament in 1994, was head of the PES/S&D group between 2004-2012 and has been president of the Parliament since 2012.

This experience is both a weakness and a strength. The current trend for Commission presidents is for them to be selected from the ranks of former prime ministers, and it's easy to see why. Name recognition, executive and diplomatic experience and (for members of the European Council) an understanding of national leaders. While Schulz doesn't have this, he clearly knows the EU institutions inside out and currently leads one. Speaking German, French and English and having lead a multi-national political group in the Parliament for 8 years, he should have a good grasp of EU political issues, how the institutions work (and how to work them) and how to build coalitions at the European level. Compared to a former prime minister who is offered the job, Schulz clearly sees the Commission presidency as the top job in his career and will probably be more politically ambitious in the role.

As a more openly political Commission president, a Commission lead by him would probably be more combative. Schulz sees wants the election to be a battle of ideas. As president of the European Parliament for almost 2 years, he hasn't actually voted on many of the most recent and controversial policies (as it's not the role of the president), but he has been a vocal president (no doubt with an eye on the upcoming campaign). In the last few months he's called for immigration reform (and wants Germany to take more refugees), supported pausing the trade talks with the US over the spying affair, supports a smaller Commission, sees the balance between large and small Member Sates shifting too much towards the larger ones, and is anti-austerity and wants Eurozone reforms (including a Currency Commissioner who chairs the Eurogroup). 

It's an open question how far he can take this combativeness from the Commission - the Commission still needs Council and Parliament approval to pass legislation. However, having an outspoken President could be a positive for small member states who want the Commission to do more to counterbalance the big countries, provided that they feel they can hang on to their Commissioners. Those who want an active Commission or to change the economic direction of Europe could see him as the man to pin their political hopes on, but Schulz will need to build broad support across Europe to get the votes he needs, and it might not be the biggest electorate in the world. Though with Eurosceptic parties established as the protest vote and rising in popularity, the PES probably can no longer simply rely on anti-incumbency sentiment to boost its vote. A more coherent anti-austerity vision may actually be the better than national parties simply going their own way. Politically and rhetorically, Schulz is to the left of several of the PES's member parties, though his main Eurozone and anti-austerity ideas are not too far outside the mainstream of the pro-integration centre-left.

How much Schulz's opinions will make it into the PES election manifesto remains to be seen, but Schulz has used the EP presidency to set out his leadership style: political, left-wing and federalist on the Eurozone and not afraid to annoy the bigger Member States. Whatever your political opinion, you can't accuse him of being another Barroso. Obviously this makes him an unlikely choice as the European Council's pick for the Commission, which makes electoral success all the more important for Schulz. He not only needs the PES/S&D to emerge as the winners of the election, but he has to be a visible and successful part of the campaign so that he can't be sidelined by the European Council. As I said yesterday, the lack of an open primary contest makes this more difficult.

EU reaction to the NSA Affair

The fallout from the NSA Affair and Snowden's leaks continue, with revelations that Angela Merkel's mobile phone was hacked causing worldwide headlines (though there's been some criticism of Merkel for taking so long over these allegations, and indications that the NSA has been spying on German citizens, seriously, as Der Standard pointedly notes with the headline "Und ploetzlich ist es ein Problem" ["And suddenly it is a problem"]). The Guardian is reporting that the number of tapped heads of government is probably much higher, and the European Council has finally been roused too - it turns out that prime ministers don't like to be spied on. Now everything from the halting of data-sharing agreements to cancelling the free trade talks is on the table (after all, it's much harder to negotiate if you're being spied on).

The European Parliament has also signalled its displeasure, voting for a motion calling for the end of the SWIFT agreement. It's not binding, and the Commission has responded by stating that there is no indication of wrong-doing under the SWIFT Agreement (or "Terrorist Financial Tracking Programme" - PDF). Parliament's issues with SWIFT aren't new to the NSA revelations, however. After a troubled birth (the Parliament voted down the first agreement before passing the second after lobbying from Vice-President Joe Biden), last year the report before Parliament on the implementation of the safeguards in the agreement caused disquiet - it turned out that the full report wasn't even made available to MEPs to review. (Notably, the European Data Protection Supervisor had criticised some of the key provisions of the draft SWIFT Agreement).

The Commission has said that the agreement has effective safeguards, and that it's waiting on the response to a request for reassurances from the US. It's not planning to suspend the agreement.

Martin Schulz, the President of the European Parliament has also said that the free trade talks with the US should be suspended in the light of the spying affair.

The most notable moves, though, probably come over the draft Data Protection Regulation. The European Parliament has adopted its position on the law this week, which has hardened. The subject of intense lobbying, the biggest impact of the Snowden-leak was to reverse the watering down of the proposed law, with the security of citizens' data in the hands of US companies a key concern. The bill still has a long way to go, and it has to be agreed with the Council before it can be signed into law.

But what does this all add up to? At the end of this week the EU still transfers the same kind of data to the US as at the start, and there is little coherence in the EU's position. Most demands amount to the suspension of agreements or negotiations, and it will take a while to see what actually comes out of this. If we are ever going to see better data protection standards and a more regulated approach to intelligence and police work, we have to have clear standards and guidelines on how we shape these laws. When it comes to the EU, a proper regard for the necessity and proportionality of proposed security laws within the EU and agreements with third countries has to be stressed. And the Commission must drop its deference of the security services if it is to enforce and monitor agreements - or even draw up laws.

EU Budget Deal: Progress, from a Psychological point of View?

The EU institutions (Commission, Council and Parliament) reached a deal on the Multi-annual Financial Framework (MFF) that plans EU budget spending for 2014-2020. The MFF is not absolutely final since it has to pass a Parliamentary vote in September, but the deal does mark the end of the parliamentary revolt against the deal cut by national leaders. Politically, it's been a very charged budget, with arguments for cuts in a time of austerity, the European Parliament flexing its muscles over the budget, and the resignation of the parliamentary rapporteur on the MFF after the Irish Presidency mistakenly announced a deal last week.


So what's in the deal?

The cuts agreed by the Council remain: for the first time, the EU Budget will face a real terms cut of €85 billion, reducing the budget over the next 7 years to €960 billion. The focus on cuts meant that the parts of the budget prized by national governments were protected at the expense of more discretionary spending. The deal softens this by:

- Permitting the front loading of up to €2,543 million in 2014-15 for youth employment, research and Erasmus and apprenticeships and pro-SME policies, to be split as:
            - €2,143 million for youth unemployment;
            - €200 million for Horizon 2020, the EU Framework Programme for Research and Innovation;
            - €150 million for Erasmus; and
            - €50 million for COSME, a programme for the competitiveness of SMEs;
- Allowing for voluntary contributions by Member States by up to €1 billion to the €2.5 billion pot for aid for the most deprived;
- Unspent money will in an annual budget will be retained by the EU for spending on other projects, rather than being returned to the Member States;

- There is a concession to the idea of the MFF being subject to review and revision, but it seems very vague.

Is this, in the words of EP President Martin Schulz, progress "from a psychological point of view"?

The deal has shown that the EP has made some progress in shifting the MFF back towards some spending that is not the preserve of a national carve-up. There are national vetoes behind agricultural spending, cohesion spending and rebates, but no single Member State has a defining interest in EU projects that tackle unemployment, research or competitiveness. Can you imagine a British Prime Minister saying that they've cut some of the rebate in order to protect spending on unemployment programmes? The EP has demonstrated some value in trying to balance the budget more in the direction of spending for programmes that all of Europe benefits from, but that don't deliver specific national receipts of money.

That said, the concessions aren't a major victory for the Parliament - particularly on the aid for the most deprived and on MFF review, where the concessions appear so vague and woolly as to be practically meaningless. However, it is notable that a right-leaning European Parliament has not held out for reducing or eliminating the cuts to the EU budget. Despite the unprecedented level of power over the budget, the Parliament hasn't been as pushy as it might have been. From my point of view on the left, the deal is a defeat: it doesn't really deliver that much in terms of research and employment projects, and it buys into the idea of austerity despite the EU Budget not being in deficit. Cutting from common programmes to symbolically satisfy austerity is daft, and it undercuts further the ability of common European spending to offset, at least to some extent, the economic damage caused by national austerity.

Still, the fact that a right-wing EP largely endorsed the budget direction set by the European People's Party-dominated Council is not surprising, though it's another sign that the Parliament does act along ideological and party lines, which is important for the upcoming elections next year. Party and policy do matter in the EP.


Party Positions

The EP still has to vote in the MFF in September if the Framework is to be passed, so the positions of the European political groups matter. What are they?

Supporters:

The European People's Party (EPP; centre-right) probably support the deal, though they do not have a specific press release at the time of writing. Since they are the largest group in the Parliament and dominate the Council and national governments, they will probably support the deal. EPP parliamentary leader Joseph Daul supports current Eurozone/EU economic policy, but also insists on flexibility and a review clause in the MFF. I think EPP support can be assumed.

The European Conservatives and Reformists group (ECR; centre-right, but further right than the EPP), have welcomed the deal, and have complained that the European Parliament tried to obstruct it. Since they have got the cut in the budget they wanted, and the cut is a big win for David Cameron, they're not likely to vote against.

Qualified Supporters:

The Alliance of Liberals and Democrats (ALDE; centrist, and economically centre-right) have welcomed the deal, but want to secure some of the details before giving support, such as on the legal basis of the MFF (to secure the Parliament's power), on money for the Digital Agenda and on the review clause.

The Socialists and Democrats group (S&D; centre-left) have welcomed the deal as an improvement for youth unemployment schemes and Erasmus, but will discuss their position next week.

Though only qualified support has been given, I imagine that now that the EP has finished its negotiations as a whole and that there have been some concessions, these groups will largely support the MFF.

Opposition:

The European Greens (Green) have condemned the deal as only consisting of cosmetic changes when the overall budget is still being cut.

United Left (GUE-NGL; left-wing) also condemned the cuts to the budget, and hit out against EP President Schulz for only seeking agreement with the two biggest political groups in the Parliament (EPP and S&D), keeping the rest of the groups in the dark.


While these aren't firm voting stances by the political groups, it looks like there will probably be a majority for the MFF, failing any last minute revivals of Parliament-wide opposition.

Nobel Prize Collection

As postscript to the award of the Nobel Prize to the EU, it's been decided that the presidents of the 3 EU institutions - Commission, European Council and Parliament - will go to collect the award in Oslo. It's not been decided who will give an acceptance speech.

I'll not spill any more digital ink over this, but clearly there needs to be a ceremonial "head of the EU" status given to one of these posts since for such situations because the current arrangements aren't working (the Lisbon Treaty hasn't proven a solution to the representation problem here). It would make sense to give it to the Commission President, I think, with a protocol for when it is the whole EU that needs to be represented, and not just the European Council.