Mario Draghi’s intervention in European politics, with the report he gave to the President of the Commission, Ursula von der Leyen, was resounding and revealing of the state of weakness in which the EU finds itself, of the dangers it faces but also of the ways with which she can cope with her problems.
The Italian former central banker of the E.U. he focused on the dependence of the European Union on third countries in terms of industrial production, energy and technology, but also on the need to strengthen Europe’s defense industry so that it can protect itself from now very visible military dangers.
According to Draghi, investments in these four sectors: industry, energy, technology and defense require financing of at least 800 billion euros per year. And while the experienced politician and economist agrees that these investments should basically be private, he points out that the participation of the E.U. must play an important role because the private sector cannot cover such figures. He also proposes the financing of these investments with European bonds, which is constantly requested by many countries but is always rejected.
The European Union has so far failed to unite in any area, apart from the euro. There is no political unification, economic unification, banking unification, a single capital market, nor a single foreign policy, nor of course a single defense policy. The only thing that is uniform is the currency and the production of directives and laws by a hypertrophic bureaucracy. Regarding this, Draghi specifically mentioned that from 2019 until today the E.U. produced 13,000 laws compared to 3,000 produced by the US.
The European bureaucracy, with the rules it sets, very often works destructively for the member countries and their peoples. And not in one area, but in almost all. Zero-pollution energy policy, for example, is a wonderful, romantic goal, but it comes at a huge economic cost. And the Commission is imposing measures to achieve the goal without having funding available. The result is the precision we see today, the closure of thousands of European industries, the rapid loss of competitiveness of Europe against all third countries.
European industrial products cannot compete with Asian ones, in the field of technology Europe is a dwarf compared to the USA, China and other countries, European defense only exists as an anecdote and the risks are constantly increasing.
The day before yesterday, the Greek prime minister heard the thoughts of the Germans that Greece should give money (equal to the benefits given by the Germans) to the immigrants who have received asylum from Germany, to return here (as a country of first reception), because Germany does not he wants them. Mitsotakis, of course, refused to discuss it, explaining that Greece cannot give more benefits to immigrants than it gives to Greeks. However, the German proposal shows how intense the reaction is inside the EU. for a unified response to the problems faced by the Union as a whole. It tries to transfer the single problem to individual countries instead of solving the individual problems with a single policy.
It is certain that the Draghi report will fall on deaf ears. The Commission may welcome it with smiles and praise, but it will be archived and ignored, just as all the voices calling for more unification are ignored.
Because what Draghi points out as problems have been pointed out repeatedly by the European media, by business associations, by economic institutes, by MEPs and executives of international organizations. And the solutions he proposes, the same: they have been proposed repeatedly from almost everywhere and rejected every time.
The European Union does not want to proceed with further integration and will necessarily pay for its choice. With too much money for sure, with poverty and marginalization of many, including Greece and perhaps with very great disasters, if the geopolitical developments that continue to escalate lead to a generalized war.
I must note here the following: when Greece was in crisis, at the time of the memoranda, then US President Barack Obama had visited then Chancellor Angela Merkel and had pointed out to her that the way the E.U. the Greek crisis but also the debt problems of European countries is insufficient. He had indicated to her that she should allocate more than 1 trillion. euro to stabilize Europe. Merkel was shocked by the American approach, an approach previously followed by Draghi in the European bond crisis, when he had declared as Europe’s central banker that the ECB would do whatever it takes, – “Whatever it takes”, he had said – to support European economies. And he did. Unfortunately, neither Lagarde who is currently in the ECB, nor Merkel then, nor of course Von der Leyen have the courage, the political size and the punch to adopt such policies. With half-measures, with misguided firefighting interventions, with micropolitics and balancing exercises, problems of this magnitude cannot be dealt with.
However, the problem with regard to common fiscal management, with the issuance of Eurobonds, begins with the “poor” countries of the European South, which jointly requested the assumption of their debts, but are not prepared to hand over the fiscal policy of their countries to the Brussels. It cannot e.g. the German and the Dutch taxpayer to take over the public debts e.g. of Greece, Italy, etc., without the respective Greek and Italian governments handing over the control and preparation of their governments’ budgets. The debts cannot be shouldered by all European citizens and e.g. Greek governments to manage the public finances of their member countries as they wish, distributing-wasting money in allowances and increasing the size of their public sector by constantly appointing their clients-voters to it.
The European Union today has such a large political deficit that, unfortunately, the path to deterioration, even to the “loss of our freedom”, described by Draghi, is rather inevitable.
