Shame

“When I heard one after the other, all the new member countries, each poorer than the other, say that in the interest of reaching an agreement they would be ready to renounce some of their financial demands, I was ashamed.”

EU president Jean Claude Juncker as quoted in this BBC News article. Discuss, if you like.

This entry was posted in A Fistful Of Euros, The European Union and tagged , by Guy La Roche. Bookmark the permalink.

About Guy La Roche

Dutch translator and subtitler living in Brittany with his three cats. Has also lived in the Flemish part of Belgium. Speaks English rather fluently and in a former life used to have a decent command of Spanish. Knows swear words in German and Russian. Not quite francophone yet, but slowly getting there. Vaguely centrist observer of the world around him, extremely naive and, sometimes, rather proud of it. Writes Venale Pecus.

27 thoughts on “Shame

  1. The fuse was lit three weeks ago and we are now agonizingly watching it taper to destruction.

    If what Juncker says is true then the UK should be ashamed of itself. What a tragedy that Blair, who is crusading to relieve third world debt, should trip up on his doorstep over maintaining the UK rebate at the expense of his partners.

  2. Far better that Bruxelles be chagrined than the organised idiocy that is the CAP continue.

    Poland et al will be far better off if French anti market feeling for *intra-EU trade* (rendering the common market rather nonsense) is broken, than squabbling over inefficient transfers.

  3. Don (I’ll say this once, and once only):

    What Juncker asays is not necessarily true. The UK has no reason to be ashamed of itself.
    There is a cross party consensus within the UK that Blair’s approach is correct and that he should hold firm.
    There is also a fear that he will manage to snatch defeat from the jaws of opportunity.

  4. It seems that I have heard all of this before.

    First Chirac blunders into a referendum and loses. Next Chirac looks for a scapegoat (Blair) to say he is being unfair even though Britain is the biggest contributor to the EU. Next Chirac takes an untenable stand supporting the magnificent farm subsidies to french farmers (this is called buying votes).

    Where have I heard this before? The corrupt United Nations has been doing this to the U.S. for decades. Like England to the E.U., the U.S. is the largest contributor to the U.N. and Chirac is the U.N. largest detractor. He leads a list of Saddam beneficiaries, he leads a list of “oil for food” corruption and he may be the leading factor in the destruction of the United Nations. Why on earth do the British (or the other E.U.) members put up with him?

    If Chirac (and France) continue to be the spoilers of organized society, why not toss them out and play with those that are willing to make positive contributions?

  5. Except under the present regime – and even with the rebate Britain is the second highest contributor to the EU budget after Germany.

    There’s an easy way to increase regional aid to poorer countries, slash the CAP. Why should the rest of the EU pay to keep France as some sort of glorified Gallic theme park?

  6. 1. The UK does not need to pay any more to the EU, whether under the guise of the rebate etc or not.
    2. The UK is a massive net contributor, always has been. It’s the rich countries that are net beneficiaries that should be on the defensive.
    3. One that comes to mind is Luxembourg.
    4. The academic consensus on regional spending is that it does nothing for economic development, so the CEECs lose little except pork-barrel handouts by reductions in aid.

  7. A helpful and illuminating recent brief posted from Ireland on EU member state contributions to the EU budget: http://www.finfacts.com/irelandbusinessnews/publish/printer_10002107.shtml

    Another brief, also from Ireland, reminds us that, “Despite being one of the richest countries of the European Union, Ireland will continue to receive significant amounts of what can be termed ‘Foreign Aid,’ until 2007.”
    http://www.finfacts.com/comment/irelandeunetreceiptsbenefits.htm

    This second brief includes a chart showing how Ireland attracted more cash income from the EU per head of population than any other EU member state.

    “Only four countries benefited from EU money in 2003 – Portugal, Greece, Ireland and Spain – while the rest were net contributors. In terms of cash per head, the funding amounted to a net receipt of ?391.70 for each Irish national. At the other of the scale, Dutch, Luxembourg and German nationals pay ?120, ?125 and ?92.7 respectively, while each Briton pays ?46.50.”

    A table reports that in 2003 – the latest year for which figures are shown here – Ireland made a net receipt of ? 1,563.3 millions, equivalent to 1.4% of Ireland’s GDP.

    Eurostat estimates of GDP per capita in EU countries:
    http://epp.eurostat.cec.eu.int/pls/portal/docs/PAGE/PGP_PRD_CAT_PREREL/PGE_CAT_PREREL_YEAR_2005/PGE_CAT_PREREL_YEAR_2005_MONTH_06/2-03062005-EN-BP.PDF

    The official EU brief on financing the budget is here:
    http://europa.eu.int/comm/budget/financing/index_en.htm

    A quick and illuminating presentation on how the EU budget is spent shows that agricultural subsidies and rural development swallow 46%:
    http://news.bbc.co.uk/2/shared/spl/hi/europe/04/money/html/introduction.stm

    Surprise: France and then Spain gain most from EU spending on agricultural and rural aid:
    http://news.bbc.co.uk/1/shared/spl/hi/europe/04/money/html/agriculture.stm

    “Figures on who receives European farm subsidies show most payments go to wealthy landowners, not small farms, according to a leading think tank. . . ”
    http://news.bbc.co.uk/1/hi/uk_politics/4373397.stm

  8. Bob B is right — the Republic of Ireland does a nice job of keeping a low profile at these budget negotiations, even as any plausible case for a net transfer from the EU to Ireland has gone. And before anyone points out that the country still has poor regions — it could be supporting those with domestic revenue sources if it wasn’t busy blowing all the cash on building motorways to help depopulate the rural areas even more. If there’s thing Bertie Ahern knows how to do, it’s using Blair as a lightning conductor.

  9. “I was ashamed.”

    Funny how he feels ashamed about this, and not about the fact that citizens from the accession countries have been denied freedom of movement in the labour market till 2007.

    I don’t think Chirac makes a very convincing champion of the Central and East European members.

    What is most worrying is the lvel of the rhetoric and the absence of real interest in change. I suppose this was already pretty obvious after DdV’s “100 days” speech.

    Chirac has till 2007. I suppose what really matters is who will replace him.

    Reform of the CAP is essential to get an agreement in the Doha round. Oh, and just to close with people feeling ashamed, doesn’t J-C J feel even a little bit ashamed about the impact of the CAP in the ‘poorest poor’ countries.

    Btw Ray, I think Blair could usefully go on a ‘Snow-like’ speaking tour in the US on this topic: the structural reforms are a good idea on both sides of the Atlantic.

  10. Ireland is a small country which has made a remarkable transformation from an impoverished rural idyll to high-tech affluence since its accession to the EU in 1973. Even so, the case for continuing to commit 46% of the total EU budget to agriculture and rural development until eternity defies common sense. No wonder the agenda of the EU Lisbon summit in 2000 to make Europe the most competitive economy in the world by 2010 has had to be written off as completely unachievable.

    A large hunk of the EU’s problems, if not all, derives from the collective insistence on living in a permanent delusional state. Focusing on the UK’s rebate is just a desperate fling to deflect attention from the rejections of the EU Constitution treaty in the referendums in France and the Netherlands, the refusal to countenance reform of the EU budget and maintaining a naive conviction that Europe can be somehow indefinitely sheltered from the economic consequences of globalisation. The EU needs gear itself up to consider positive options for the future, not stay enshrouded in the past. Remember that in Britain, Blair is mostly regarded as rather too enthusiastic about the EU and prospects for it.

    Vive Fr?d?ric Bastiat:
    http://bastiat.org/en/petition.html

  11. Well I think Juncker should be ashamed of himself. As EU President it should have tried to be an honest broker. Instead it showed that it was just the poodle of France and Germany.

  12. “Next door in the French briefing room, Mr Chirac was more aggressive still, proclaiming that “Europe is in a deep crisis”, and blaming “the selfishness of two or three rich countries”. In an extraordinary breach of protocol, he added: “Personally, I deplore the fact that Britain refused to pay a fair and reasonable share of the cost of enlargement.”"

    This comes from a very readable piece in the Independent.

    http://news.independent.co.uk/europe/story.jsp?story=648002

    I think now it is possible to see the argument coming. Enlargement was kept off the agenda last week. The French vote was a vote (in part) against enlargement. Blair has now been wangled into a corner where he might seem to be not wanting to pay for an enlargement agenda he is now about to push.

    Obvioulsy if this degenerates into some kind of ‘playground’ row amongst spoilt schoolchildren we will all be losers. Clearly Chirac can now veto all the proposals of the British presidency, and then Britain can veto all attempts at budgetary agreement that don’t include a timetable for ‘winding up’ the CAP. But where will that leave us?

    Instititutionally this is where the Commission comes in, to try and get people talking again, and to get some constructive proposals back on the table. If the EU’s political agenda becomes tied to the timetable for the French presidentials (and this I take it was part of the reason for ‘urgency’ last week), then the consequences do become increasingly unpredicatable.

  13. Incidentally, we shouldn’t forget just how discredited Chirac is in France itself. This extract from today’s Le Monde illustrates that nicely:

    “Sur le papier, on peut incriminer, comme l’ont fait M. Juncker, M. Chirac et Gerhard Schr?der, l’intransigeance britannique sur le budget. Le pr?sident fran?ais ?tait habilit? ? d?fendre bec et ongles une PAC sanctuaris?e par un accord unanime en 2002. Mais M. Blair a eu beau jeu de d?noncer l’”anomalie” consistant ? consacrer 40 % du budget europ?en ? la PAC, c’est-?-dire sept fois plus que pour des d?penses d’avenir sur les sciences, la technologie, la recherche, le d?veloppement et l’?ducation.

    Ce n’est pas le moindre paradoxe que de constater aujourd’hui que le double non fran?ais et hollandais ? motiv? en France par un refus de l’Europe lib?rale ? aboutit ? une remise en selle du champion d’une ligne social-lib?rale ! Le seul plan B qui existe n’est pas celui qu’annon?aient les d?fenseurs fran?ais du non de gauche. C’est bien le plan Blair.”

    For those who don’t read French, for Le Monde the ‘paper victory’ went to Juncker, Chirac and Schr?der, but the real winner, the real plan ‘b’ is Blair. And Le Monde does not disapprove.

    http://www.lemonde.fr/web/article/0,1-0@2-3214,36-663709@51-662200,0.html

    Another article goes further. Blair only need wait on the German elections later in the year. He will have an ally in Merkel.

    “Salu? par M. Juncker, le pr?sident fran?ais a ?galement re?u l’appui du chancelier Schr?der : “veut-on un march? dot? de quelques instruments, ou veut-on une union politique avec tout ce que cela comporte ?” , a lanc? ce dernier. Pour M. Schr?der, “ce qui se passe en Chine, en Inde, en Am?rique du Sud, exige une r?ponse politique de l’Europe, pas seulement ?conomique” .

    Mais le chancelier est lui aussi dans une position difficile. Sa rivale chr?tienne-d?mocrate, Angela Merkel, est donn?e gagnante lors des ?lections anticip?es convoqu?es ? l’automne. Qu’adviendra-t-il alors du couple franco-allemand ? M. Blair ne s’y est pas tromp?, qui, lors de sa derni?re visite ? Berlin, est d’abord all? voir Mme Merkel, lib?rale en ?conomie et favorable ? une r?vision de la PAC, avant de rendre visite ? M. Schr?der.”

    http://www.lemonde.fr/web/article/0,1-0@2-3214,36-663672@51-662200,0.html

    In the light of all this, the Visegrad post -

    http://fistfulofeuros.net/archives/001511.php

    and the comments may be quite relevant.

  14. It is indeed a dire situation but at the same time I’m hopeful. Because:

    A) The status quo no longer exists (definite)
    B) A lot of positions/stances are becoming unfrozen (doesn’t mean we’ll get new positions, but it could)
    C) The new EU members seem to be taking a pro-active stance
    D) A lot of the old guard (Schroder, Chirac, Berlusconi) have become ineffective or are on their way out.
    E) Because of the new EU members it’s no longer “polictics as usual” with the “usual suspects”.

  15. I’m happy to see that nobody here is so stupid to play the blame-Blair-game that Chirac and Schr?der tried to play.
    The CAP is a giant scandal: EU is partly built on the expenses of the poorest people in the world.
    The entire project has to be revised.

  16. As Edward indicates, many Brits would be amazed at how critical people in France are of Chirac?s position on the CAP. The idea of a reasonably low ceiling on individual CAP subsidies is considered sensible, although I?m not sure that this is the aspect of CAP reform that will most suit Mr. Blair. It?s the high proportion of EU money that goes to the top 20% of agricultural recipients that?s seen as the real problem. But Blair?s argument about the need to devote a greater percentage of the budget to research and development is widely accepted. As in Italy, the problem is a national government too unpopular to take the necessary measures, even when there is a wide domestic perception of the need for such measures.

    However it has to be said, however unjust it is, that Blair?s championship of further expansion and the ?new Europe? has got off to a rather bad start: Captains do not usually cry ?Follow me chaps! Every man for himself!?

  17. Part of the hiatus over the EU budget summit, it seems to me, is because Chirac and Schroeder have played much the same sort of tactics Blair himself plays in domestic politics in Britain and which were deployed at full strength to boost support for the Iraq war at home and in Europe generally. In the end, the effect is to discredit politicians who resort to these ways.

  18. It’s an interesting dispute.

    It is clear that chirac is playing the blame game and trying to deflect flak towards Blair. It’s also clear that Blair is right on the substance – the imbalance in the structure of the budget is ludicrous. The fact that Chirac won’t accept this point even in principle confirms his status as one of the last big political dinosaurs.

    On the other hand, Blair did sign up to the ring fencing of the CAP in 2002, and is now saying that deal must be re-opened, which he must have realised was never going to fly in this type of negotiation. The British needed to have put this argument on the table 2 years ago – not two weeks before the summit.

    So I’m left asking – what would the British have accepted? Would they have bought a deal freezing the rebate , with a committment to re-examine the CAP together with the rebate for the next financial period (2013 onwards)? Was that on the table or not? Would the French have accepted that?

    The press reports are not too clear on the nuances.

  19. “On the other hand, Blair did sign up to the ring fencing of the CAP in 2002, and is now saying that deal must be re-opened, which he must have realised was never going to fly in this type of negotiation.”
    On the other hand, the other Europeans did sign up to the British rebate in 2002, and are now saying that the deal must be re-opened, which they must have realised was never going to fly in this type of negotiation.

    What’s good for the goose is good for the gander. If Chirac and Schr?der didn’t want their little fait accompli to be unraveled, they ought to have refrained from their attempt to pick the pockets of British taxpayers to subsidize French farmers even more than they already do. It’s an absurdity to expect the British government to treat the rebate as up for grabs while the incredibly wasteful and illogical agricultural subsidies are kept off limits from discussion.

  20. “On the other hand, Blair did sign up to the ring fencing of the CAP in 2002,”

    But that was then, and this is now. Back in 2002 Blair was in fact much more on the defensive for other obvious reasons. My guess is that what is happening now is pretty calculated. Chirac is weakened by the referendum, Merkel is probably coming, and so now is possibly as good a moment as he’ll get. He can always accommodate when he has taken the high ground, which I think he is doing. The suggestions seem to be that the UK will try to act first to recover lost ground with the new members.

    But as you say, interesting dispute.

  21. I agree that those things have shifted Edward. The problem is, do we re-open every deal when circumstances change? Particularly when it is political “capital” that has shifted around?

    What if they had reached a deal this weekend. Then two years down the road, with different faces in Berlin and Paris (and Rome), suppose a demand was made to unravel the deal? It’s a dangerous game.

    Of course – the other side of the coin is that Blair is right on the substance. Although the CAP is going through major reforms, it makes no sense to have a budget skewed as it is.

    And perhaps this question is so important that the opening of a done deal should have been considered small beer. But it was never realistic to expect the French to agree.

    The British must have known this. Which is why I’m curious as to what they “really” wanted at the summit.

    In my view the Brits should have put this issue (CAP vs rebate) squarely on the table two years back when that CAP deal was brokered. By not doing so they missed a trick.

    But I’m sure that at the time their priority was to ensure that enlargement happened, so they did not want to complicate the affair too much and risk upsetting the apple cart. So the British bought the CAP deal, despite protests.

    Abiole’s comment above, incidentally, seems quite wrong to me. I don’t recall any agreement in 2002 for the british rebate post 2006. If Abiole can point me to a text backing up that position, I’d be astonished.

  22. I suspect few among European electroates are interested in the fine print by now. With all the political capital and hype invested first in selling (premature) monetary union and then the EU Constitution treaty, European political leaders have a mounting credibility problem among home electorates for reasons it is not difficult to discern from the flagging performance of the major Eurozone economies and the evident reluctance of European electorates to endorse the Constitution. Poor ol’ Henry Kissinger, there’s still no single telephone line to Europe: diversity continues to prevail.

    In the British context, Blair is regarded as a Euro-enthusiast. The Eurosceptics here are being very polite about the recent shambles in Brussels but they are looking rather smug and ‘told you so’ now.

  23. There’s a bit of UK lunacy on this front. Both the Dutch and the Germans pay about twice as much per head to the EU as the UK. Yet when confronted with this, the argument get’s stuck on either France, the CAP or the unwillingness to re-evaluate the privilege of the UK rebate.

  24. Which is why Germany and in particular the Netherlands were so insistent on capping or lowering their respective payments.
    And at the same time the UK was just supposed to hand-out money in order to be a “good European”!! It’s always been about national interest.

  25. Which is why Germany and in particular the Netherlands were so insistent on capping or lowering their respective payments.
    And at the same time the UK was just supposed to hand-out money in order to be a “good European”!! It’s always been about national interest.

  26. Seems like this is timely opportunity for a fundamental rethink on the EU budget and how it is financed but that has been brushed aside to engage in the game of blaming the UK so we’ll all forget about the 46% of the EU budget being spent on agriculture and rural development, the flagging major economies of the Eurozone and why the French and Dutch voted down the EU Constitution (bless them).