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Bartholomew Gallacher

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Coronavirus could be final straw for EU, European experts warn

Leaders are warned that if division prevails, pandemic will be more destructive than Brexit, migration and bailout crises

The European Union has weathered the storms of eurozone bailouts, the migration crisis and Brexit, but some fear coronavirus could be even more destructive.

In a rare intervention Jacques Delors, the former European commission president who helped build the modern EU, broke his silence last weekend to warn that lack of solidarity posed “a mortal danger to the European Union”.

Enrico Letta, a former prime minister of Italy, has said the EU faces a “deadly risk” from the global pandemic. “We are facing a crisis that is different from previous crises,” he told the Guardian – partly, he said, because of the unpredictable progression of the virus, partly because “Europeanism” has been weakened by other crises of the past decade.

“The communitarian spirit of Europe is weaker today than 10 years ago,” he said, adding that the biggest danger for the EU was “the Trump virus”.

If everyone took the strategy of “Italy first”, “Belgium first” or “Germany first”, he said, “we will all sink altogether”.

“This is definitely a make-it-or-break-it moment for the European project,” said Nathalie Tocci, a former adviser to the EU foreign policy chief. “If it goes badly this really risks being the end of the union. It fuels all the nationalist-populism.”

She points out, however, that so far Italy’s far-right leader, Matteo Salvini, has plummeted in the polls, while the popularity of the lawprofessor-turned-prime minister, Giuseppe Conte, has risen. “In some respects, the public actually want the rational, moderate, reassuring but firm kind of leader.”


Merkel’s moment of truth
Crisis offers German leader one last chance to embrace ‘more Europe.’


Just when it looked like Angela Merkel was going to ride quietly into the sunset, fate intervened.

Two weeks ago, the German leader’s biggest worry was finding a successor and a life after politics. Now she finds herself in the center of what many consider the most serious global crisis since World War II.

“The coronavirus pandemic is a human tragedy of potentially biblical proportions,” former European Central Bank President Mario Draghi warned this week.

For better or worse, Merkel is the only European leader with either the experience or stature to take charge. The European Union’s current crop of chieftains — Council President Charles Michel, who spent one term as Belgian prime minister, and Commission President Ursula von der Leyen, whose spotty reputation as a German minister precedes her — are both untested and unknown to most Europeans. The European Central Bank, a rock of stability when Draghi was in charge, has developed decidedly shakier legs under Christine Lagarde, his successor.

That leaves Merkel — assuming she doesn’t have coronavirus (she was exposed to the virus by a doctor a week ago, but the first two tests she took were negative).

[...]

A common criticism of Merkel’s handling of the eurozone crisis is that her strategy addressed the short-term crisis, not the currency’s underlying flaws.

That failure, her critics say, robbed her of a true European legacy.

While Merkel is revered by many on the center left outside of Germany, in particular in the U.S. and U.K., that’s mainly because they appreciate her for what she’s not: loud, bombastic or obnoxious.

The coronavirus crisis presents the German leader, whose term ends next year, with a final opportunity to push through the elusive “deeper European integration” most observers say is necessary to preserve both the euro and the European Union in the long term.

Over her long tenure as chancellor, Merkel has repeated time and again that Germany’s destiny lies in Europe. Now’s her chance to prove it.


 

Aribeth Zelin

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German Bundeswehr transported in patients from Italy and France as our hospitals still have capacities and the peak is not expected soon... I would not call that behaviour "Germany first!" just because we locked borders to ordinary traffic...
I agree - after all, just because I'm not letting company over and not leaving my house doesn't mean, if someone needed help, I'd not try and give it.

Is just sensible to keep from spreading this modern plague.
 

Bartholomew Gallacher

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German Bundeswehr transported in patients from Italy and France as our hospitals still have capacities and the peak is not expected soon... I would not call that behaviour "Germany first!" just because we locked borders to ordinary traffic...
This is not the point why "Germany first!" was mentioned in the article, so please allow to explain it: China and the USA have created massive programs to aid their economy. The EU so far has not made such a thing on their own, only the nations for themselves. The lack of such financial support for the economy directly from the EU is what many states are criticising.

Like already happened during the banking crisis many southern states again demand the introduction of special bonds for this crisis, which they simply call coronabonds. The foremost reason why such bonds never happened in the EU is the veto of Germany. Now this demand is back on the table, and the crisis is harder than the banking crisis back then.

So the question is: what will Angela Merkel do? Will she still prevent such bonds coming into life, or finally allow the introduction?

This is what this article was about - will such bonds finally came into live or not. Now it seems there is going to be a compromise, which could be though not enough.
 

Bartholomew Gallacher

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The EU is not a nation like China and the US.
That makes these kind of decision making complicated and time consuming.
Countries which needed support quickly will simply not care about those details. They needed support on time and got none from the EU, and that's the image which is going to last from now on for a long time: when we needed support the most our allies failed to deliver. And this might be the final nail in the coffin of the EU as we know it, the damage is already there.

Regarding bonds the issue is if a big nation like Germany would make a move in that direction I am sure most countries would follow.
 
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Sid

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They need that financial support because they had severe money problems before the virus already.
While the northern states like Germany, The Netherlands and the Scandinavian countries had gone trough all kind of hoops to be financially on the safe side (like reforming the pension rules (from 65 to 67 years) Italy, Spain and France did very little to nothing.
And now they ask the northern countries to pull their wallets, no questions asked.
There have to be some rules and regulations in place about how to continue with this Corona Bonds stuff financially, because we are not idiots here up north and let countries like Italy live out of our pockets for the rest of our lives. They will have to clean up their act after the crisis, mandatory.

On the other hand financial help is needed, that is for sure.
Our PM Mark Rutte is opting for a fund where countries donate free money for Italy and Spain to fight the corona virus (he is talking about billions) but there have to be strict rules in place for the money that is needed to support their economies (the bonds).

There is a lot of work to be done now and in the future.
And then there is still that UK thingy that needs attention too.
 

Aribeth Zelin

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They need that financial support because they had severe money problems before the virus already.
While the northern states like Germany, The Netherlands and the Scandinavian countries had gone trough all kind of hoops to be financially on the safe side (like reforming the pension rules (from 65 to 67 years) Italy, Spain and France did very little to nothing.
And now they ask the northern countries to pull their wallets, no questions asked.
There have to be some rules and regulations in place about how to continue with this Corona Bonds stuff financially, because we are not idiots here up north and let countries like Italy live out of our pockets for the rest of our lives. They will have to clean up their act after the crisis, mandatory.

On the other hand financial help is needed, that is for sure.
Our PM Mark Rutte is opting for a fund where countries donate free money for Italy and Spain to fight the corona virus (he is talking about billions) but there have to be strict rules in place for the money that is needed to support their economies (the bonds).

There is a lot of work to be done now and in the future.
And then there is still that UK thingy that needs attention too.
Doesn't sound much different than the US to be honest. Some states are solvent and others aren't, but lord help the ones that are if they don't help those that aren't - even though oft times, it never actually gets to the citizens. I'm speaking as someone who has spent most of her life in one of these non-solvent states....
 

Kara Spengler

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Hmm, bojo in the icu and the uk leaving what the eu can do to help puts a twist on things.
 

Stora

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North-South divide clouds key EU meeting

The coronavirus pandemic has exposed deep divides in Europe, with EU member states arguing over how to tackle the economic fallout.

Italy and Spain have accused northern nations - led by Germany and the Netherlands - of not doing enough.

Spanish Prime Minister Pedro Sánchez has even warned that if the EU fails to come up with an ambitious plan to help member states saddled with debt by the fight against coronavirus, the bloc could "fall apart".

EU Council and Commission chiefs released a statement on Monday that said a "strong package is in the making".

A teleconference between Eurozone finance ministers on Tuesday went on for seven hours and was set to continue through to Wednesday morning after Italy refused to back down on its demands.

A similar meeting two weeks ago bore little fruit. As a result, leaders sent their finance ministers back to the drawing board.
North-South EU divide clouds coronavirus meeting
 

Sid

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Spain and certainly Italy are trying to get their financial disasters (that they build up during the last decade) fixed with cheap money, payed for by the countries that did get their finances in good shape (with lots of unpopular laws (pension age to 67 etc) and cuts) after the last financial crisis.
Italy, Spain and even France acted more or less like financial Banana Republics. They have let their national dept grow and grow and grow as if only the sky was the limit.

Money for their medical needs: Yes. Should be free or next to free.
Money to solve their financial mess dating from before the corona crisis? Only under very strict rules and regulations.

The northern countries should not trow themselves under the bus to solve other countries financial problems. 'We' did what we had to do the last decade to get in financial good shape again. 'They' refused.
We have a Dutch saying: Who burns his buttocks will sit on the blisters. I think you'll get the idea.
 
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Khamon

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Understanding Sid's position, and understanding the northern states' position, it sounds more like a bitter old couple on the verge of divorce than it does a productive Union.
 

Sid

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I think we have to let the Euro go again in the future.
When each country has his own currency again, each individual country can manage their finances as they like.
Now the Euro zone has several caps in place where every country should be at least be working towards (directly during and after a crisis) or (best) stay under.
That is what the northern countries like Germany, The Netherlands and the Scandinavian countries did and do.
Further south not so much.

When every country can make individual choises again, Itally and Spain will most likely use the 'good old' money devaluation system again.
5000 lira or 1000 pesos for a cup of coffee within 10 years again, the Frensh Franc at 15 cents.....
IMHO, You can't keep spending money that you haven't earned yet (or never will) in the long term and stay financially thrust worthy at the same time.

I was always in favor of the EU, but maybe the whole EU has to be reshuffled, only keeping what is worth saving.
The EU is not only financially under pressure but also democratically.
Hungary has de facto a dictator.
Poland has laws in place lately, that at least are questionable when looked at it in a way as we understand democracy.
 
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Aribeth Zelin

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I think we have to let the Euro go again in the future.
When each country has his own currency again, each individual country can manage their finances as they like.
Now the Euro zone has several caps in place where every country should be at least be working towards (directly during and after a crisis) or (best) stay under.
That is what the northern countries like Germany, The Netherlands and the Scandinavian countries did.
Further south not so much.

When every country can make individual choises again, Itally and Spain will most likely use the 'good old' money devaluation system again.
5000 lira or 1000 pesos for a cup of coffee within 10 years again, the Frensh Franc at 15 cents.....
IMHO, You can't keep spending money that you haven't earned yet (or never will) in the long term and stay financially thrust worthy at the same time.

I was always in favor of the EU, but maybe the whole EU has to be reshuffled, only keeping what is worth saving.
The EU is not only financially under pressure but also democratically.
Hungary has de facto a dictator.
Poland has laws in place lately, that at least are questionable when looked at it in a way as we understand democracy.
Basically, the EU has to decide if it needs to consolidate more, or fall apart. Thing is, its not all that different than how the US started; for good or for ill. At one point, each state actually did have its own currency, iirc.
 

danielravennest

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Basically, the EU has to decide if it needs to consolidate more, or fall apart. Thing is, its not all that different than how the US started; for good or for ill. At one point, each state actually did have its own currency, iirc.
I'm afraid your memory isn't accurate. The most common coin in circulation during colonial days was the Spanish silver dollar. Spain was getting all that silver from the Americas, and traded with the colonies because the Gulf coast belonged to Spain at the time. The first US coinage act, 6 years after the Constitution was ratified, set the US dollar to equal the average weight of the Spanish dollar, so they traded one-to-one. It took a while before there was enough domestic coinage to displace the Spanish ones.
 
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Stora

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EU could fail over outbreak, warns Italy's Giuseppe Conte

Italy's prime minister has told the BBC that the European Union risks failing as a project in the coronavirus crisis.

Giuseppe Conte says the EU must act in an adequate and co-ordinated way to help countries worst hit by the virus.

Mr Conte says the European Union needs to rise to the challenge of what he calls "the biggest test since the Second World War".

This was his first interview with the UK broadcast media since the pandemic exploded in Italy seven weeks ago.

He was speaking as Italy and some other EU countries try to push more frugal members of the bloc to issue so-called "corona bonds" - sharing debt that all EU nations would help to pay off. The Netherlands in particular has opposed the idea, leading to a clash between finance ministers of the eurozone.



EU could fail over virus, warns Italy PM
 

Stora

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Stupid reporter suggests that we delay leaving the EU, promptly told that we have already left.

 
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Sid

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