After the EUCO in Brussels: what needs to be done to consolidate a historic achievement

by Monica Frassoni - green, federalist, and co-promoter of the European Citizens Initiative

There is no doubt: the agreement reached at the European Council is truly historic: the possibility of having some sort of Euro-bonds guaranteed by the EU budget and therefore by all members was unimaginable until a few months ago and this is good even if since the Covid crisis was also unimaginable, having a different result would have been a total debacle. In any case, the agreement reached yesterday does not represent a precise agreement in all its parts, on the contrary: a hard work will have to be done at both European and national level to define the contours and, in particular, the practical application of a series of programs, agreements and measures that will have to pass partly through the European Parliament, partly through the Commission and the Council of Ministers. Even for potentially very significant innovations such as the new eco-taxes on plastics or CO2, it will have to be seen whether unanimous agreement can be reached. It will also be necessary to understand how these decisions will be taken in the different countries ; on this, the debate in Italy shows that there are many (including myself) who perhaps have a bit of “Rutte” inside them and hope that clear criteria, especially in the field of Green Deal and digitization, can avoid the risk to throw away money in useless and counterproductive endeavors.  

That said, there are several reasons why this long summit of Heads of State leaves a bit of a bitter taste. The first is that the portion of the subsidies from the Recovery Funds is being drastically cut from 500 to 390 billion, and drastic, short-sighted cuts are also being made to the multi-annual budget, which remains at 1074 billion, more or less the same as before COVID. It is better than nothing considering that the "frugals" wanted zero subsidies, but we are still far below what is necessary. The second is that in the negotiations and in the comments on winners and losers, the idea that the EU is an ATM machine: how much money goes to one or the other is the measure of success or failure. There was practically no room for a discussion on the role of the EU, on the strategic vision that should guide the financial choices; the Green deal and digitization priorities were saved only because they had already been adopted and anyway because of the ample space that will be given to member states we will really see some good ones in the coming months. It is no coincidence that the most significant cuts, have been precisely in relation to the most innovative European policies and measures, those that the pandemic has shown to be indispensable to prepare and defend us from this and future crises: Research (Horizon) goes from 15 to 5 billion, the important Eu4Health initiative that in the Commission's proposal was worth 9.4 billion euro is cancelled altogether, as well as the fund to help small and medium-sized enterprises immediately; Invest-EU, the successor to the Juncker Plan goes from 30 to 5.6 billion euro; the Just transition Fund that should accompany the most "fossilized" regions in green conversion goes from 30 to 10 billion euro in seven years, and so on. The planned and necessary recapitalization of the European Investment Bank also remains at stake for the moment, pending the decisions of the Board of Finance Ministers at the end of the year. In other words, less money for European programs, more resources and reimbursements to the states. On this, it is urgent that the European Parliament puts up a fight  to recover at least part of the funds lost, since it has the power to reject the financial perspective and co-decide on annual budgets. But many people doubt that the only democratically elected supranational assembly with legislative powers in the world will have the strength and the majorities to do so. We shall see. 

On the much-discussed issue of governance, that is, who finally decides on the granting of loans and subsidies, the victory of Rutte and his allies is real on the principle of the preponderance of governments over common institutions, but its application will be very unlikely: governments will hardly put their peers in the dock: proof of this can be found in the case of Hungary and Poland, which have been dismantling their already fragile democratic system almost undisturbed for years. So, shifting power from the Commission to the Council is wrong, both because it makes the evaluation of the various programs more arbitrary and politicized and because it further diminishes the role of the 

of the common institutions to the advantage of the intergovernmental method; a method that in these 5 days has again shown all its limits and its ugliness. The same applies to the clause on respect for the rule of law in order to obtain funds, which moves from an almost automatic mechanism to a complex system of appeals and referrals that remains in the hands of governments. As with the procedure provided for in Article 7, which in theory can lead to the suspension of a state's rights and which has been open for months and months for Poland and Hungary, very little will be done about it unless Parliament manages to snatch some improvement during the forthcoming negotiations. 

What conclusions can we draw for the future from this European Council?

The first is that we are facing yet another dejà-vu that the Covid crisis has only partially limited. Since the beginning of my "career" as a European federalist, I have seen a truly considerable number of European Councils or negotiations in which the historical results have been overshadowed by unnecessary quibbling and the willingness of many to slow down EU action rather than speed it up. This reality over the years had a devastating impact on the EU's ability to act in the interests of Europeans. The reason is always the same. The principle of unanimity and therefore the right of veto. If the ECB worked with unanimity, there would probably no longer be a euro. If in 2007 Merkel (her again) had not agreed to take on the Poles by granting unanimity on strategic decisions on climate change, we would undoubtedly be further along today; if there were no unanimity on taxes, we would perhaps enjoy a decades-old carbon tax today because the Delors Commission was the first to propose it. We would also have a law on pluralism and against media concentrations, perhaps Orban would not have a free hand, etc. etc. Even in these days it was the unanimity rule that gave so much weight to Rutte and the even more dangerous Kurz. Two cynical men who, like the other three frugal men, had absolutely nothing to lose and remained totally insensitive to the high appeals to the European sense or the mumbling of their government allies: They - and they said so - only cared about the internal scene and since they could block everything they did so without any problems as long as it was agreed, wisely taking advantage of the weakness of Charles Michel who immediately gave them big discounts, of the fact that Merkel didn't want to force and that Macron knew perfectly well that he had to keep the Germans on his side and not risk losing them with too hard positions. 

In short, without the requirement for unanimity, the Union would have been a Union, perhaps for quite a few years, and today we would have many other common instruments. Therefore, without getting rid of this “cancer”, it will not be possible to move forward at the pace and with the necessary rules and resources. 

But the problem is that reforming the Treaties and removing the unanimity rule requires ... unanimity. How to get out of it? There are two tools to be used. The European Parliament and ... the Europeans, in particular those who have invaded the streets of Europe in their millions to demand action and resources against climate change and for the rights of all and everyone.  

The European Council is in the habit of keeping the EP out of the button room by arrogating to itself powers that the Treaties do not give it, since it does not have a legislative role but one of strategic direction, and even in this case it overdid it  cheerfully: it is up to the European Parliament to put itself back at the center of the initiative against the intergovernmental drift of the EU, using to the maximum and in a noisy way the vast powers it has gained over the years. It is also in a position to take up the constituent initiative again, involving those - and there are many  - who see common action on economic and social development, the fight against climate change, the rule of law and conflicts on our doorstep as essential. It would also be a good time to take advantage of the fact that, for once, many governments have taken the actions of the "frugals" very badly and that a serious discussion about a smaller, but more cohesive and democratic Europe could open again.  It is no coincidence that the German Presidency's program also talks about possible changes to the Treaties; it will be important in this respect that the issue is put on the agenda of the Conference on the Future of the EU which is due to open in the autumn. In conclusion: rather than singing victory in the face of lots of easy money or getting completely depressed in the face of the exploits of arrogant blonde young leaders, it is better to prepare oneself to make the most of what is available to us and relaunch the battle to strengthen democracy and European integration. We saw what expects us if we don’t move in Rutte's smile and Orban's cunning statements.