Marching Separately But Striking Together Over At the ECB

Well first of all, a very Happy Xmas to any of you foolish enough to be reading tiresome posts like this one on such a special day as this – a tiresome post which simply starts by going into some nitpicking follow-up detail to my earlier post on ECB liquidity and monetary policy separation – That Which The ECB Hath Separated, Let No Man Join Together Again! – but then starts to explore the rather more torrid topic of what exactly Latvia’s Regional development minister Edgars Zalāns might have had in mind when he told the Delfi news portal that the Latvian agreement with the IMF and other lenders could “easily be amended given its shaky legal grounds” (there, that made you hiccup-back-up some of your xmas-pud, now didn’t it?) or what Prime Minister Valdis Dombrovskis might have been getting at when he warned that “We will just go bankrupt if we observe all legal norms.” Continue reading

Boring EU Institutions Post

The collectif antilibérale makes the excellent point that there is no problem with the appointments to the new jobs created by the Lisbon treaty. Two things will control their in-trays, after all – the first is the job of getting a major new institution, the EU external action service, operating and building up its credibility and budget-attracting power, and the second is the eternal one of seeking consensus between the major powers, institutions, and interest groups in a diverse confederation with a small central government.

If the EU has an effective diplomatic service and at least a rough consensus on policy, it can’t help but be listened to – it’s too important for this not to be the case. But if the member states, the institutions, and the interests that underly them don’t have a minimum degree of consensus, or the administrative machine doesn’t work, it won’t be – and it won’t matter who gets the job. And, of course, a major reason for the top level changes in the Lisbon treaty is to make it easier to achieve political consensus within the Union.

The most common way in which individuals influence history is through incompetence. We had to listen to George Bush as much as we have to listen to Barack Obama; the realities of US power explain that. By contrast, it’s very rare that individual brilliance can win anything against the tidal forces of strategy. It does seem, though, that anyone can change things for the worse by their bungling; you can argue that the Bush presidency demonstrates that this is true, despite everything the instititutions and the power of the US could do, or that it demonstrates that the institutions were strong enough to survive misgovernment that would have finished a lesser state.

So, in principle, we shouldn’t worry about the jobs except to the extent that some people shouldn’t be let anywhere near them.

And there’s a positive side. Hermann van Rompuy’s last job was as prime minister of Belgium, or to put it another way, he has made a life of doing nothing else but seeking consensus in a diverse confederation with a weak central government. Catherine Ashton’s chief achievement in government was setting up and launching Sure Start, a new, large, and complex institution that both created new structures and integrated bits of older ones – however, as this was an integrated social service for the children of the poor, this doesn’t count as institution-building. It’s women’s work.

Meanwhile, it’s been suggested that this is a policy of weakening European institutions in order to strengthen the intergovernmental side of the union. But there is nothing intrinsically beneficial about putting more stuff into the Commission. In fact, there’s been a very significant expansion in European integration that happens intergovernmentally, but for some reason this again does not count. The “community method” isn’t a religion, or rather, for some people it is. But if you must think in these terms, I reckon there is a case that we’ve had quite a bit of the famous “spillover” – in fact, working together through the core institutions has created a culture of institutional cooperation that has helped to create more cooperation.

Perhaps more could have gone through the Commission, but there has to be a better explanation as to why it should than “Monnet would have liked it”.

Meanwhile, I’d be delighted if we could start thinking about the EU without using the supranational/intergovernmental divide at all. Over time – as the original integration theories suggested – the distinction has progressively lost its explanatory power and its specificity (which one is the Eurogroup in? is Catherine Ashton obliged to divide her office into two halves?), and it may prevent us from thinking about it in other ways. After all, nobody would suggest that studying political institutions purely in the terms they themselves provide is a rigorous approach anywhere else.

(There’s a good ticktock on the appointments from Jean Quatremer, which makes clear that it was indeed Angela Merkel who selected out Blair.)

Are the Germans taking over Romania?

Not quite those Germans.

What’s happening in Romania, then? Handelsblatt reports. It’s time to pick a president, and the Social Democratic candidate looks in a strong position – although he finished second by a few points in the first round of the French-style presidential election, he’s got promises of support from several other parties, notably the Liberals and the Hungarian minority.

Fascinatingly, though, as part of the agreement with these groups, he’s promised to appoint the independent mayor of Sibiu – Hermannstadt in German – as prime minister. That’ll be one Klaus Johannis. Yes; he’s a Transylvanian German, the first time that a member of this minority will head the government. Of course, Romania has a hell of a lot of problems; the economy’s going to shrink between 7.5 and 8 per cent this year, there’s an IMF requirement to cut the public sector deficit to 7.3 per cent of GDP at the same time (ah, the IMF – never an institution to risk popularity by changing its ideas), and the country’s elite is full of old spooks from the Ceaucescu years.

But I can’t help but be amazed at the idea of a Romanian government that includes the Hungarians and is headed by a German, within 20 years of the revolution and 5 years of the CIA operating a secret jail in the suburbs of Bucharest. Well – non- or quasi-revolution might be more like it, which just adds force to the point. There are other reasons to be cheerful; HaBa also points out that there is some €32bn in EU funding heading that way in the next few years, which ought to help. If you want an inspiring European story, it’s right there.

However, they also note that the Renault Logan car factory accounts for 2 per cent of GDP and 15 per cent of net exports. I guess they can’t really be criticised for pinning their hopes on export-led growth when the UK and Germany are doing exactly that.

EU Lisbon jobs open thread

It’s now clear that the Thierry Henry assist on the William Gallas goal last night is going to generate more commentary and interest than tonight’s filling of the new EU jobs (Council President, High Rep. for Foreign Policy, and Secretary General of the Council), but nonetheless, we could be stuck with these people for a while so no harm in keeping track.  What we know: Tony Blair is out of the running for Council President, but Catherine Ashton who arrived as Trade Commissioner in Mandy’s stead apparently on the inside track for the foreign policy job.  They’re probably still having dinner at the summit and perhaps Irish PM Cowen has already cornered Sarko to argue Ireland’s case from last night, so there could a lot of distractions.  But we’ll keep an eye on it.

UPDATE: Well, that was fast.  Once Blair was out, the deal fell into place.  Herman van Rompuy as Council President.   Almost as soon as Lisbon went live, the countries seem to be working to restrain its institutions.

How Tony Blair lost the presidency 20 years ago

It’s the 9th of November…so, in total observance of my usual standard operating procedures, let’s think about the European presidency, or as my wonderful, wonderful Soizick puts it, who’s going to get the job of being Tony Blair.

It looks a lot like the lucky girl won’t be Blair; the reason why is more interesting and more telling. Over the last few weeks, we’ve seen a string of small states around Germany take quite a daring stand in foreign policy; Austria, the Netherlands, Belgium, Luxembourg, all progressively came out against Tony Blair. It seems more obvious that this is an interesting or daring stand if you take a Brussels view, in which Blair is still a respected member of the world elite, than if you take a street level view, in which he’s widely despised. Also, if you consider the UK or Norway to be a 10 on the NATO scale, the Netherlands must be about an 8 – the presence of the Joint Forces Command in Brunssum, and the long-standing and very close relationship with the British armed forces over the commitment to the NATO Northern Flank, are the most obvious manifestations of this. Indeed, the Dutch army served in the British zone of Iraq and its Apache helicopters, the first European-owned ones, are still flying in Afghanistan. (That the first AH-64Ds in European ownership are Dutch is a marker of NATO spirit in itself.)

So the fact they came out against Blair is interesting.

Further, it’s incredibly rare that the Austrians would launch a significant foreign policy initiative without first clearing it with Berlin. This has been true since at least 1878, and the most famous example is one that neither party would like to recall – the Blankoscheck of 1914. Dutch policy is not much different. The upshot is that in opposing Blair, this odd block of states was in a sense acting for Angela Merkel. Not long ago, and we’re talking two months here, Nicolas Sarkozy was being tempted to support Blair; relations between Britain and France have rarely been better than during the last three or so years, it being a major priority for both sides to mend fences after the ghastly Alistair Campbell-inspired frogbashing campaign in the run-up to the Iraq war.

The Franco-German alliance is considered untouchable by both allies, and everyone else – we all know only too well the alternatives. Practicality requires both of them to maintain a relationship nearly as close with Britain, as does the value of having other options. So, assuming Merkel doesn’t want Blair, it was necessary to have the opposition to him floated by others.

In terms of foreign policy, this is the Germany that resulted from the 9th of November, when Merkel herself decided to go to the sauna rather than rush to the border. She apparently reasoned that, once open, there would be no closing it again, and therefore there was no hurry; of course, she was right, but when you think of some of the stories from the Wall years about people whose lives were utterly changed by which side of the border chance put them, it demonstrated a lot of confidence in her reasoning.

This is the Berlin republic, then; discreet, hypercompetent, and steeped in that distinctly northern European combination of self-effacing modesty and intense pride. Like 17th century houses in Amsterdam or 18th century ones in Edinburgh or York; ostentatiously modest, excessive in their austerity of design. Or the supposed Yorkshire traits – being both taciturn and opinionated is quite a trick. It’s been said before that in German, there’s no distinction between the words for citizen/civil/civic and for bourgeois, and that the revolution worked in this ambiguity. Merkel is exhibit A.

Welcome to the Lisbon Era

Czech President Vaclav Klaus, after much hemming and hawing, signed the Treaty of Lisbon this afternoon. It is expected to enter into force on 1 December 2009. This success is undoubtedly the highlight of the Swedish Presidency, which made concluding ratification a top priority.

Prominent changes include more qualified majority voting in the Council of Ministers, increased involvement of the European Parliament in the legislative process through extended codecision with the Council of Ministers, eliminating the pillar system and the creation of a President of the European Council with a term of two and half years and a High Representative for Foreign Affairs to present a united position on EU policies. The Treaty of Lisbon will also make the Union’s human rights charter, the Charter of Fundamental Rights, legally binding.

Now that that’s done, is everyone ready for the next round of enlargement?

Sweden politely lays down the law

Not since the glory days of Gustav Adolf the Great has Sweden wielded such power in Central Europe.  It’s been a busy day.  First, PM and European Council President Fredrik Reinfeldt held a meeting with under pressure Czech PM Jan Fischer to discuss the status of Czech ratification efforts on the Lisbon Treaty (in an omen, Fischer’s plane was delayed).  The other two European “Presidents” (commission and parliament) were also there.   Reinfeldt’s careful formulation: “it is important that we are flexible and ready to act”, meaning that no more pressure on the Czechs on top of what is already there, but background preparations for treaty implementation will proceed nonetheless.  Meaning specific job descriptions and candidates for the positions of permanent Council president and foreign policy representative.   So formally nothing gets done prior to ratification, but things move at lightning speed once Mr Klaus gets out his quill.   In the meantime, the Swedish minister for EU Affairs, Cecilia Malmström, will go to Prague to gauge the state of affairs on the ground.

But wait, there’s more.  Sweden’s finance minister Anders Borg has put the cat among the pigeons on the fiscal restructuring package for Latvia, which is a complicated mix of support from IMF, EU, and Nordic countries.  Essentially he argued that unless the promised cuts are delivered in the forthcoming budget, the Nordic component won’t be delivered as planned.  And this as the Latvian government works on legislation to convert loans into the non-recourse variety.  While the specifics of these moves may be somewhat surprising, the big picture is that the inevitable dynamics of choosing internal devaluation over external devaluation are playing out as Edward has been warning here for months.

That’s a lot of action over 4 days.  We may not say it often, but keep a close eye on Stockholm for the next while.

UDPATE 8 OCTOBER: PM Reinfeldt had what sounds like a truly bizarre conversation with Czech President Klaus in which Klaus asked for a 2 sentence footnote to the Lisbon treaty.  This looks rather mischievous since the footnote could easily have been agreed at the European Council summit which gave Ireland the treaty clarifications that it wanted.

Treaty of Lisbon: Endgame

Today is a key inflection point in determining whether the EU will be looking forwards or backwards over the next few months.  Irish voters will have had their second run at approving the Lisbon Treaty by referendum.  The count begins at 0800 GMT and it’ll be worth checking the Irish Election blog for early word of the “tallies” (informal survey of ballots as they are sorted) as well as general reaction to the result.  There’s some possibility of anti-climactic process if the tallies or a reliable exit poll signal a clear Yes margin early on but there have probably been a few sleepless nights in government circles nonetheless.   Assuming a Yes vote, there will be 3 issues worth watching:

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The European integration of extreme-right wing nonsense

Here’s a weird story. OK, so we’re into the last lap of the Irish re-referendum; Jean Quatremer has the latest polls, which put the yes camp well ahead. But what about that weird poll last week that put the noes ahead?

British blogging institution Anthony Wells’ UK Polling Report seems to be about the only media outlet to have hit the nail on the head, denouncing it as a voodoo poll as far back as the 21st of September.

As far as I can tell, this poll is hokum. The company don’t seem to have a website so I can only go on what I’ve got, but the sampling of the poll seems to have been conducted at just ten sample points, suggesting a face-to-face survey with no attempt at a broad representative spread of sample. Compare this with a professional Ipsos MORI face-to-face poll, which uses in the region of 200 sampling points. Worse, a couple of sources indicate there is no attempt at weighting the poll…

Now, it turns out, not only is the poll indeed deeply flawed, but it’s the work of an ex-IRA terrorist who left the organisation because it wasn’t nationalistic or Catholic enough. It seems that his “Gael Poll” consisted of asking people he and his friends knew, thus constructing a sample they knew would provide the right answer.

The researchers were friends of the organisers who in turn interviewed people in their social groups, paying some attention to the spread of social class… It is, in effect a huge straw poll of the friends of Gael Poll, a derivative project of a pretty extreme ultramontane Catholic magazine, The Hibernian.

But the really interesting bit is how they got it into the news; they passed the fake poll to UKIP, who distributed it to bloggers, including Mick Fealty’s much respected Slugger O’Toole, and used the blogfroth this generated to reflect it back into the mainstream media. Even more interestingly, the no campaign turns out to have been receiving actual financial subsidies from UKIP; even their anti-Europeanism is European, it seems, and possibly paid for with European Parliament expenses.

Mr Klaus? It’s Cameron on line 1 and Sarkozy on line 2

Only a guess of course but it’s a metaphor of the situation that will face the Czech Republic on the night of 2 October when the Irish voters approve the Treaty of Lisbon at the second time of asking in a referendum.  And they will approve it.  The opinion polls leave some latitude as to the final margin, but even a generous assumption about the voting behaviour of the “don’t knows” doesn’t alter the prediction that it will pass.

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