Prof. David Farrell of SPIRe and the Dublin European Institute discusses the large and important variation in the electoral systems that will be in use for the European Parliament elections this May. Check it out on our sister blog here
Cutting taxes is a largely ineffective strategy for attracting foreign investment.
Dr. Aidan Regan of SPIRe on the effects of tax policy on attracting foreign investment:
The eurozone crisis has hastened the move toward increased fiscal integration among member-states, reflected in the fiscal stability pact, and the proposed measures for a centralised authority to monitor national budgetary decisions. This move toward a fiscal union is widely accepted as necessary to embed and stabilise the monetary union. The politics of this integration process, however, are deeply contested, particularly in relation to the proposed European financial transaction tax. Countries such as Ireland, the Netherlands and the UK have used tax competition as a strategy to increase foreign direct investment (FDI), which has become a lynchpin of their economic development models. The UK is unlikely to become part of any fiscal union. It is probably safe to assume that the Conservative government would be more likely to pull out of the European Union than accept increased ‘interference’ in national budgetary decisions. They are not members of the eurozone, will never accept a Federal Europe, and will continue to pursue tax competition as a strategy to lure corporate financiers and investment to the City of London.
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Countries which intervene most often in negotiations over EU legislation tend to have the least bargaining success.
The Laeken Declaration states that: “[T]he European project . . . derives its legitimacy from democratic, transparent and efficient institutions.” Negotiations aimed at revising EU transparency legislation (Regulation 1049/2001) began in 2008, but since December 2012 are at an impasse. These negotiations are important because the outcome will govern how the public can access records relating to the EU’s legislative process when it comes into force. The current impasse exists because of significant inter- and intra-institutional disagreement between the Commission, Council and Parliament about how transparent the legislative process should be and how the process of record release should be governed.
Europe’s ‘structural reform’ agenda is little more than a fairytale
Dr. Aidan Regan blogs about structural reforms as a response to the Eurozone crisis:
There are four actors who have dominated the political and policy response to the Eurozone crisis: the executive of the German Federal Republic, now a super majority between the Christian and Social Democrats, Finance Ministers who make up the Economic and Financial Affairs Council (ECOFIN) of the European Union, the European Central Bank (ECB), and the executive of the Economic and Financial Affairs Commission, that is, the Department of Finance of the European Commission).
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Transparency in the Council of the European Union has increased over the last decade, but only for the least controversial negotiations
The Laeken Declaration states that: “[T]he European project . . . derives its legitimacy from democratic, transparent and efficient institutions.” Negotiations aimed at revising EU transparency legislation (Regulation 1049/2001) began in 2008, but since December 2012 are at an impasse. These negotiations are important because the outcome will govern how the public can access records relating to the EU’s legislative process when it comes into force. The current impasse exists because of significant inter- and intra-institutional disagreement between the Commission, Council and Parliament about how transparent the legislative process should be and how the process of record release should be governed.
Structural imbalances in the Eurozone
A joint article – entitled ‘Austerity could only ever bring Europe so far’ – has been published in the Guardian newspaper (and elsewhere). It is signed by the Hungarian EU Commissioner for Employment, a French MEP, an Irish government minister (Joan Burton), a former Belgian politician (and current OECD official) and the French president of the European Economic and Social Committee. A number of proposals are made regarding the future governance of the EU, such as the necessity for a banking union, increased investment (including in education) and an expansionary monetary policy. But the most striking aspect of the article is its argument that “Rebalancing through aggressive reduction of government spending and similar measures in deficit countries… is, without higher domestic demand in the surplus countries, a recipe for long-lasting recession and disintegration”. Specifically, they want to see wages in surplus countries “catch up with productivity”. This, to my knowledge, is the first semi-official recognition of one of the key structural imbalances underpinning the crisis.
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Defense and the Irish Presidency of the Council of the EU
As the Irish European Council presidency draws to a close, all eyes are on the big ticket items the Irish Government pledged to address: substantive progress on economic governance and banking union; jobs, growth and the single market; the MAFF; EU-US free trade; fisheries and agriculture reform and a host of others. Somewhat overlooked has been the issue of security and defence. The Irish presidency has worked tremendously hard to contribute to a positive momentum in the run-up to the dedicated European Council discussion on security and defence at the December 2013 summit. The prevailing mood in advance of that discussion seems to be one of anticipation tempered by apprehension.
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EU’s rich north benefits from the Eurocrisis
Various studies confirm that public and even official debate about “bailouts” has been badly mis-framed as a question of whether the better-off northern member states are willing to contribute their taxpayers’ money to aid their struggling Eurozone partners. In fact, as reported today by Reuters, the richer countries have benefitted massively from the huge decline in their own borrowing costs in recent years, without having lost one euro through loans to Greece, Ireland, Portugal and Spain. In addition to this safe-haven effect, I would add that Germany and others have benefitted through increased export competitiveness derived from the fall of the euro over the same period.
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EU shares responsibility for the mistreatment of migrants in Greece
Media coverage of the mistreatment of migrants and asylum-seekers in Greece has focused, quite rightfully, on the responsibilities of the Greek government — both its duty to ensure that all individuals are processed according to legal guidelines and its duty to ensure their protection from violent abuse by vigilante gangs and even by public officials. This recent film highlights the Greek government’s persistent failings in both regards.
However, there is substantial evidence that the EU as a whole — through its Frontex operation — bears significant responsibility for these outrages to human dignity. Consider this 2011 report by Human Rights Watch.
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Armaments, corruption and debt
A recent report found that “the governments of countries of lending countries – like Germany and France – are emphatic on the priority of [Greece] settling outstanding bills with arms suppliers…, while at the same time insisting on swingeing cuts in public spending and other austerity measures”, despite the fact that there is evidence of corruption in at least some such armaments contracts. This article from Irish Left Review argues that core country decision makers can legitimately be accused of hypocrisy on this and other issues: http://www.