Pam Barker | Director of TLB Europe Reloaded Project
Here is further insight, from French pro-Frexit politician Florian Philippot, on what the recently negotiated EU covid recovery fund and EU operating budget means (MFF). And for any sort of national sovereignty and citizen power, it is of course not good.
Philippot (pictured) was the Vice President of Marine Le Pen’s Rassemblement National (RN) party in the days of it being the Front National (FN), from 2012 – 2017. He has his own party now, a patriot party advocating Frexit, unlike Le Pen who is laying low on that subject.
A reminder of what just happened from Sputnik:
In the early hours of Tuesday morning, EU leaders agreed on a new seven-year budget, also called the multi-annual financial framework (MFF), and a COVID-19 recovery fund worth a combined 1.8 trillion euros ($2.1 trillion). The 750 billion euros of recovery money will be financed by the European Commission borrowing directly on financial markets, with the debt burden shared by all EU states. This means net contributors to the EU budget will be effectively paying more while net receivers will get even more than before. The commission’s debt is expected to be repaid by 2058.
According to the deal agreed upon by EU leaders, the bloc’s budget between 2021 and 2027 will be set at 1.074 trillion euros. Additionally, a COVID-19 economic recovery fund comprising 390 billion euros in grants and 360 billion euros in repayable loans, will be divided among the EU’s member states.
So net contributing countries like Austria – one of the Frugal Four – will be paying more this time around, from 1% of GDP (2.9 billion euros) to 2.5% (5.4 bn euros), while being given some flimsy rebate or ‘discount’ as a thank you for paying more. The reason for increasing these contributions is also due to Brexit and the shortfall of Britain’s share, in addition to the coronavirus recovery fund.
Below, Philippot pertinently mentions the situation of Greece. We have documented here how Greece’s original debt levels were illegally made to look larger in order to create a stronger case for bailing it out with massive IMF loans it obviously could never repay (the IMF is not supposed to issue loans knowing this). Meanwhile, with each tranche doled out, totalling three, came sets of conditions on how it would be spent, hence the word ‘austerity’. With the result that Greek people were seeing massive increases in their taxes and drastic cuts to pensions and public services. Many Greeks have been living on 300 euros a month, without a hospital service they can use, for example. Unemployment has been high for a long time and a brain drain has ensued, while the migrants pour in with money set aside for them! Meanwhile, public assets have been stripped and put into private hands, with the result that ‘the people’ own nothing while the oligarchs and banks own more and more. And all political parties have essentially gone along with this arrangement. The net result? Greece cannot be called a sovereign country anymore. Close to the Black Sea, it’s become little more than a US military base for anti-Russian surveillance-and-control operations.
Not included in this Sputnik piece below but included by Philippot in a video (see also this) he put out this week, the recovery program includes a ‘plan for reform’. Whose plan? Not the individual nations’. A particular country’s plan for spending this money must be submitted and evaluated over a 2-month period and given a score or rating of approval. Any deviation found between a country’s spending intentions and the EU’s programme (of what? liberalization and privatization of the public sphere) must be adjudicated by some counselling body within the EU. Macron, Philippot notes, did not mention this.
The second thing Macron has been duplicitous about is the repayment of the sum of 40 billion euros to France, that neither its debt nor people’s taxes will pay for it. Which means that the sum of money is gift, a grant in effect, and that is what Macron is having us believe. But, says Philippot, France is a net contributor, which means it puts in more money into the EU budget than what it gets back, and this difference has been getting larger through the years. For the sum of 40 billion euros France will get, he calculates, it will end up paying 78 billion, almost double. France will pay by the back door.
Translation of Tweet: “We’d do better to borrow from Cofidis (formerly a French consumer credit business) … With the EU we have a rate of interest of 100% minimum (80 billion euros for 40 billion received) and, what’s more, they’re telling us how to use this money. Sign the petition for a referendum on this terrible agreement.”
Also, this infamous levying of taxes on member states by the EU is a breach of sovereignty because taxation is always deemed a sovereign right of an elected government over its people, who can turn around and vote out the government. In this case, the EU is just levying taxes in an undemocratic and secretive manner. It makes a lot of money off nation states in this way, which is essentially a transfer of sovereignty.
Are the French ok with this arrangement? Shouldn’t we have a referendum on it, he asks.
More of Philippot.
France’s on a Loser, Will Gain Obligations, Not Benefit From EU Recovery Plan, Politician Says
On 21 July, after four days of intensive summit talks, EU leaders agreed a much-awaited €750 billion recovery plan to tackle the crisis caused by the COVID-19 pandemic. The French Patriots’ leader Florian Philippot has explained why, for France, it’s too early to pop open the champagne.
“The goals of our recovery can be summarised in three words: first convergence, second resilience and transformation”, stated President of the European Council Charles Michel on Tuesday. “Concretely, this means: repairing the damage caused by COVID-19, reforming our economies, remodelling our societies”.
French President Emmanuel Macron, who has taken an active part in working out a solution to the bloc’s economic downturn together with German Chancellor Angela Merkel, praised the development as “historic”. “We have created a possibility of taking up loans together, of setting up a recovery fund in the spirit of solidarity”, he emphasised.
New Plan Paves the Way to EU ‘Federalisation’
Though Macron welcomed the “historic” EU plan, the newly-concluded agreement poses a threat to the sovereignty of European states, in particular France, warns Florian Philippot, the leader of the French Patriots party and former member of the European Parliament.
“This is largely a new method as it is about a common financial commitment; however, the concept behind it is the same and even more coercive”, Philippot observes. “Subsidies will be provided to countries on the condition of implementation of the Greek scenario, i.e. neoliberal policies and austerity measures”.
The extraordinary recovery effort titled Next Generation EU (NGEU) envisages that funds will be funnelled to seven programmes (ER: this linked-to report doesn’t specify what those 7 programmes are) in the form of grants (€390 billion) and loans (€360 billion) to speed-up the recovery in member states. In addition, the bloc’s member states struck a deal on a €1,074 billion EU budget for 2021-2027 aimed at reinvigorating the union’s economy.
“States will not be able to use their money at their own discretion”, the French politician notes. “It is about establishing total control over EU member states”.
While the funds are expected to be distributed to the countries from 2021 to 2023, the bloc’s member states will have to submit their national reform plans to the European Commission before receiving the first tranche. Each new tranche will require a prior validation by the Commission and a qualified majority of EU states. Besides which Brussels will implement certain oversight mechanisms to ensure that the funds are used to enact the reform pledges made by member states. To repay the loans, the Commission has been planning to establish “a yield curve of debt issuance, with all liabilities to be repaid by the end of 2058”, as the Financial Times specified on Tuesday.
This approach threatens to violate member states’ sovereignty and marks yet another step towards the “federalisation” of the European Union, argues the French politician.
The Only Frenchman Benefitting from the EU Deal is Macron
Meanwhile, in the eyes of Philippot, France will be a loser at all levels as it will gain much less than other states due to the obligations it is taking on: “The funds that we will receive can be used only on a condition of austerity measures”, he says. “In addition, we will pay for discounts provided to ‘frugal’ countries and Germany”.
The so-called “frugals” – a Netherlands-led group of five wealthy northern nations – opposed the EU common financial commitment from the start and insisted on substantial cuts to the programme. As a result, the grants, which were initially supposed to total €500 billion, were reduced to €390 billion.
“Frugals” are doing in many respects better than France, Philippot remarks, explaining that they negotiated the agreement with cuts to their national contributions, refusing to pay for the countries hardest hit by the crisis.
All in all, the only Frenchman who benefits from this agreement is Macron, according to the politician: for the French president it’s an ideological win, plus he got substantial media attention.
“We are moving towards European sovereignty, which Macron speaks of, but this sovereignty does not belong to the people”, Philippot concludes.
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