In the face of the ongoing crisis, European Parliament lawmakers must make it clear that negotiations for the EU’s long-term budget are starting at 2% of GDP and will not go below 1.5%, and that the EU budget for 2020 will be at least 2% of the Union’s GDP, writes MEP Radan Kanev.
Radan Kanev is an MEP from the Democratic Bulgaria coalition (EPP). The first version of this op-ed was published on EURACTIV Bulgaria.
“The world will never be the same” and “the EU is in the midst of its most severe crisis in history” are probably the two most clichéd phrases of the past 20 years. That is not to say that they weren’t true on every occasion. And perhaps they are even more true today.
And if the changing nature of the world is obvious, whether the EU will exit this crisis to find itself stabilized or completely shattered is less so.
It is evident that the Union is more threatened than ever, and the idea of European unity is profoundly shaken. The economic and health aspects of the crisis have dealt a blow both to the EU as a whole and to its member states, with no regard for their affluence or size. Europe’s institutions were not prepared. Neither were national governments.
As a result, the EU is subject to accusations of helplessness, and the respective governments – to being irresponsible, chaotic and self-centred. And all of these accusations have merit:
Is the EU helpless? To a large extent, yes. The Union has practically no competences in health policy, a remarkably small budget (around 1% of the combined member state GDP), weak budget redirection capabilities and a practically nonexistent health care budget.
In light of these facts, the EC and EP’s response was praiseworthy and relatively quick. Everything that could have been done with the existing resources and authority, has been done. But it is still far too little. As a union, the EU is too weak to react appropriately to a crisis of such a scale. Its institutions lack competences, and no common budget exists. From now on, everything is in the hands of national governments, whereas the EU’s decision-making bodies – and especially the EP – are at risk of turning into no more than sombre echo chambers.
Are national governments self-centred and unprepared? Undoubtedly. Irresponsibility and risk underestimation aside, European countries are highly vulnerable due to the very nature of the continent’s model of economic prosperity; the freedom of movement, free markets, including a free labour market, interconnected economies, a massive role for tourism, especially urban tourism, and a large number of big urban centres.
An additional factor, which has sadly gained prominence only recently, is the offshoring of 90% of the medical and sanitary industries, chiefly in one direction – China.
Consequently, even the entirety of the EU as a community and single market cannot secure the health and safety of its own citizens. But alas, the Union is not even united. The egocentrism is most obvious precisely with regard to medical equipment and health services.
It made another unwelcome appearance through the fierce resistance of the Netherlands, as well as the quiet reluctance of Germany and the Scandinavian countries, to accept taking on the much-needed burden of common debt.
It is important to note that such egocentrism is natural and unavoidable. Every national government is answerable to its voters and its citizens, including those who are sick and their families.
Every single one – even the wealthiest – is facing a collapsing budget, a congested health system and a dissipating economy. National governments are therefore duty-bound to think first and foremost of their own budgets, deficits and public debt, and only after – about those of Italy, Spain, France.
But can national egoism help us in this crisis? Categorically not. With regard to this pandemic, we are all on the same boat. Not just in words and mottos, as was frequently the case before, but in actual fact.
The wealthy northern member states cannot shut themselves off in the same pose of self-satisfied complacency as the one they assumed in 2008/2009 and for the duration of the entire Greek debt crisis.
Firstly – they have failed in taking the appropriate health measures. This is especially true for the Netherlands, which still cannot choose a course of action, but in the meanwhile managed to become an exporter of the virus and later turned into an exporter of patients to neighbouring countries.
Secondly – in the face of a pandemic, borders cannot be effectively closed. Every collapse in the health system of Italy or Spain is, and will be, felt in the North.
Thirdly – the single market and the freedom of movement of goods, services and people, are exclusively in the interest of the wealthy northern countries. They cannot endure a prolonged period of closed borders neither socially, nor economically. Investments in the health and economic recovery of the South are investments in their own physical and economic survival.
Fourthly – and most importantly – among the hardest-hit countries, and currently lacking positive prospects, is France. No European country can bear the economic and strategic effect of an uncontrolled collapse of the French economy and society in general.
The only possible response to the urgent health needs and the strategic problems related to healthcare, security and economic crisis, is a common one.
In addition to immediate support for the healthcare systems of the most affected member states, the transfer of medical staff and patients, and the securing of hospital capacity, what is needed is a strategic policy for the restoration of the European pharmaceutical, medical and sanitary industries.
A comprehensive European policy dealing with the economic crisis is also paramount. It is a well-known fact that extreme political movements “sprout” best in the environments of a bankrupt middle class and workers from failed industries.
Abandoning Italy and Spain, as well as France, to the fate of a recession would mean a heavy political crisis with potentially catastrophic implications for the entire continent.
Let us not forget that France and Italy are the two countries with the strongest and most notable nationalist and anti-European political parties, and that Spain is seeing a simultaneous rise of the far left and far-right, with anti-European rhetoric on both sides.
The European obligation towards the budget of these core member states is a political imperative without an alternative for the EU. The “wealthy” states of the North have to choose between untying their purse strings and strategic collapse.
There is also a need for an EU-level guarantee of SMEs, family businesses and the most heavily affected sectors. With the exception of countries like Italy and Spain, for whom family businesses in the tourism sector (currently devastated) are key to the national economy, this matter is also crucial for countries in Central and Eastern Europe.
To conclude – the EU is in a vicious circle. Europe’s institutions lack the resources, and national governments – the desire and democratic mandate – to undertake and finance urgent and mandatory rescue measures. The European “project” seems to be consciously contemplating its suicide, which will be undertaken rationally, with the excuse that it is the only “reasonable” exit.
Nevertheless, there is an alternative exit. And paradoxically, it is in the hands of the traditionally weakest European institution – the European Parliament. It is exactly this institution that was tasked by the Treaties with representing and defending the common interests of the EU’s citizens; of all of us as citizens of a united Europe.
And in this situation, the EP also has an instrument, a tool for political pressure. Without the EP’s consent, neither a multiannual financial framework (MMF) for the 2021-2027 period nor the EU budget for 2020 can be approved.
In the coming days and weeks, the EP must firmly and unanimously declare that it will not accept any compromise through a budget that does not factor in the needs to overcome the crisis and ensure an economic recovery. Europe needs a rescue MMF, far above 1% of its GDP, as well as a crisis budget for 2020.
MEPs must make it clear that MFF negotiations are starting at 2% of GDP and will not go below 1.5%, and that the EU budget for 2020 will be at least 2% of Union GDP. Finding the right recipe for pooling and recovering pandemic debt should also be an integral part of the political budgetary agreement.
The EP, as the chief representative of the EU’s citizens, must lead, and not follow, not only in the process of economic recovery but also in the process of restoring freedom and the normal way of life. Financing the recovery must be indivisibly linked with the elimination of all measures limiting media, political and economic freedoms.