2020 & Europe
Mis à jour : janv. 4
Written by Helene Dötsch & Timothée Ceurremans
What. A. Year.
Few of us can claim to have experienced another year similar to 2020. In and of itself, COVID-19 has made of 2020 the symbol of the last century’s most disruptive event. It has managed single-handedly and simultaneously to cost millions of lives while sinking whole economies to levels unseen since the 1929-depression.
More profoundly however, the pandemic has revealed itself to be the trigger of new ideas, ambitions and aspirations. For Europe, it has meant entering into a new era of political integration and solidarity, born out of the ashes of the EU’s failed response to previous critical crises.
Indeed, despite countless lives lost and some regrettable national-fallback reflexes at the outset of the crisis, 2020 has become a year that will be remembered as a turning point for Europe. From democratic backsliding in Eastern Member-States, to unseen fiscal integration, massive protests against racial discrimination around the world and brand-new and “far-reaching” political ambitions pertaining to the fight against climate change, 2020 has meant both extensive social isolation and unprecedented public mobilisation in the political fabric of European society. Even if isolation and democratic participation seemed to be anathema, the resignation and ingenuity of the 21st-century European citizen has enabled our societies to emerge stronger and more determined than ever, in the face of a plague unpredictably putting a halt to our once relentless and unfettered lives.
In light of this peculiar year, to mark the arrival at the end of the tunnel of this painful experience and to bode the forthcoming surge of cultural creativity, togetherness and social renaissance, ideu has collected and evaluated 5 major events within the EU that will have an undeniable influence on Europe and its future.
Without further ado, idEU invites you to its first:
Thumbs up/ Thumbs down for…
1. The fiscal response of the EU to the pandemic
In a surprising move of solidarity and under the leadership of President Von der Leyen’s Commission and the German presidency of the EU Council, the Union has come forward with a new multi-annual budget (the so-called Multi-annual Financial Framework) that encompasses, alongside the €1.1 trillion EU budget, a recovery instrument worth €750 billion . In total, the budget amounts to €1.83 trillion : an unprecedented amount that still, barely, measures up to the gravity of the COVID-19 pandemic and its societal impact.
It is noteworthy that the response to this crisis varies to a great extent with former responses to crises that have shaped the Union as we know it today. For instance, contrarily to the Union's response to the financial and sovereign debt crisis, the response to COVID-19 can be said to be common in origin, fast, more balanced and deprived of conditions on much-needed solidarity (Buti, 2020).
Despite vehement opposition by “frugal” member-states (the Netherlands, Austria, Sweden and Finland) still stuck in the pre-2020 paradigm of expansive contractionary fiscal policies and the sound-money principle (i.e. offshoots of ordo-liberalism), the EU has decided to follow a different path by indulging in what can undoubtedly be branded as a conditionless and countercyclical Keynesian fiscal response. As such, the fiscal stimulus should counter the damages of the pandemic by stimulating a fiscal multiplier engendering a virtuous circle of public spending that would lead to the kickstarting of consumption and economic activity. All of which should, in turn, raise tax revenue.
But most notably, by agreeing on a spending package composed of both unconditional grants and loans, the EU’s Member States also allowed for the temporary borrowing of funds on the financial markets by the Commission. This first-ever issuance was very successful: The bonds issued to back the SURE supranational support fund for national furlough schemes have been oversubscribed no less than 13 times.
Through this response, the Union may be ushering in a new era of political economic thinking, that may well represent a paradigmatic, "third order" change
Again, it cannot be understated how unprecedented this move is. So much so that it has been equated to the EU’s "Hamiltonian" moment, referring to when the U.S. States decided to mutualise debt and issue a federal bond to back it. Notwithstanding eloquent comparisons, what is sure is that the response to this crisis differs in many respects from the response to the sovereign debt crisis. Through this response, the Union may be ushering in a new era of political economic thinking, that may well represent a paradigmatic, "third order" change (for Helene Dötsch's article on Hall's theory and COVID click here).
Thumbs up for the nerve and determination of the EU’s institutions for this success, that could potentially be identified later as the decisive stepping stone towards a Fiscal Union. One that would undoubtedly remedy some of the EU’s biggest financial and fiscal foes.
2. Rule of law and democratic backsliding in Eastern Europe
While coronavirus restrictions have undeniably entailed their lot of rule of law violations throughout the old continent, none have reached the year-long systemic deficiencies witnessed in Hungary and Poland (which Prof. Neuwahl and Charles Kovacs have discussed in this article on ideu).
As such, said Member States have been able to profit from the political institutions ineptness to address their autocratic turn. By continuing to benefit from the EU’s funds, which represent a significant part of the countries’ GDP, Poland and Hungary have been able to fund their liberticidal excesses (Kelemen, 2017). They have used them to (over)fund their electoral campaigns and to award public contracts to cronies and political allies, all to the detriment of the freedom of press, independence of the judiciary and liberal democracy altogether.
As particularly fitting examples of textbook populism, they have engaged in the dismantling of constitutional guarantees of liberal democracy by attacking all checks and balances on their power. Doing so, they have made voting the sacrosanct and unique feature of their “illiberal” democracies. Soon, it would be no surprise to see the Member States’ liberticidal governments engage in personification of the State through cross-societal glorification of the oh-so brilliant, wise and upright Leaders of their Nations.
In the face of all of this, a myriad of initiatives has sought to address the situation: Recently, Commissioner of Justice and Consumer Protection Reynders has come out with the Commission’s new rule of law report, that will provide a systemic and complete review of the state of the art when it comes to the rule of law in all Member-States. Before that, some of the EU’s institutions (Parliament and Commission) tried to activate the “nuclear” article 7 procedure, supposed to provide a political remedy to systemic and enduring rule of law backsliding. Disappointingly, the procedure appeared weak and stalled halfway through by reason of the unwillingness of Member States to pass judgment on their counterparts for fear of future retaliation. In the meantime, the Court of Justice, the EU’s top court, has managed to bend the law so as to provide interpretations of the Treaties in a way that would complete the Union’s toolbox against backsliding and to rule favourably on infringement actions launched by the Commission. Regrettably, none of these remedies appeared powerful or broad enough in scope to put a halt to the zealous governments' actions.
It is for this reason that all institutions and many other Member States called for the inclusion, in the Recovery Instrument NextGenerationEU, of rule of law-conditionality on the basis of the Commission’s tabled regulation. This led to a stalemate during negotiations of the MFF, which eventually landed the following not-so-legal and rule-of-law-breaking compromise: Until the Court has clarified the way and the conditions by which conditionality could be triggered, the Commission has made a political declaration that it would refrain from using the mechanism, delaying thereby suspension of funds by approximately 2 years (i.e. the time the Court takes to rule on an action for annulment AND the time until Hungary's next election).
It shows that political institutions are increasingly willing to delegate decision-making to technocratic bodies to hide the most salient political issues behind the guise of legality.
This deal is, first and foremost, another proof of the ever-increasingly political role the Court of Justice is endorsing as well as the characteristic shift the EU does towards non-majoritarian, apolitical and “efficiency” and “result”-driven institutions in times of crisis, in a way that will further erode the EU’s legitimacy in the eyes of the citizens (Scicluna & Auer, 2019). It shows that political institutions are increasingly willing to delegate decision-making to technocratic bodies to hide the most salient political issues behind the guise of legality. In some way, it reminds of the famous neofunctionalist dictum : "Law as a mask and shield" (Blauberger & Martinsen, 2020).
Yet, in absolute terms, the result of the negotiations is that the Union has eventually managed, despite political qualifications, to save rule of law conditionality; thereby providing the Union with a credible tool to address rule of law and democratic backsliding for the sake of the political freedoms of Eastern European citizens.
This mixed result leads ideu to opt for a thumbs-up, but only provided conditionality will yield the desired results in terms of democratic and rule of law restoration throughout the continent, therein being included Romania and Bulgaria, next to the usual suspects.
3. The widespread and global insurgence against discrimination and racism
Despite a raging pandemic, the world was shaken by George Floyd’s murder by police officers in the US. Far from being an isolated event, this criminal act inspired millions to raise their voice and speak up against racism and racial discrimination. From the US to Europe, no big city has been spared: racial justice has found echo throughout the Western hemisphere.
As remnants of colonialism and segregationist policies, today’s enduring and stubborn racism reminds us why it is crucial that such subjects are explored, examined and studied objectively. Ideu prides itself of having done its part by shedding light on colonial practices in Africa (here and here), revealing geo-economic policies mobilised by an ever-more powerful and expansionary China and analysing South American discourse pertaining to the EU-Mercosur trade deal (here and here).
2020 has been a year of debate around racial justice that has gone far beyond the political and academic levels, to find its way into all layers of society. At ideu, we are convinced that an open and critical debate on discrimination and exclusion is here to stay and that it will improve our societies in the long run.
For this massive mobilization of European citizens joining forces to denounce permeating and vile racism, ideu gives a big thumbs up.
4. The Union’s new climate ambitions
Yes… despite a permeating and ravaging pandemic, the EU sticked to its flagship project: the EU Green New Deal, spearheaded by a resolved and competent Frans Timmermans - the Commission’s Executive Vice President.
While some betted on the EU having to rethink its ambitions to tackle climate change, the Union has proven ‘haters’ wrong. In a much-anticipated deal, the European Council recently agreed to up the EU’s reduction in emissions to 55% by 2030, a noteworthy increase in light of Polish resistance. Nevertheless, the agreement falls short of recommendations made by the IPCC, the UN international scientific board on climate change. The IPCC says that a reduction of 60% by 2030 is needed to reach the goal of the Paris Agreement of an increase of “well below 2°C” as compared to pre-industrial levels. In the same vein, the European Parliament is calling for an increase of the ambitions to 60%.
Next to the fact that the deal falls short of what would be necessary to avoid very dangerous increases in temperature, an authoritative expert and UN Special Rapporteur O. De Schutter (whom ideu interviewed on the subject) has criticized the agreement on more precise grounds.
De Schutter and Lamberts contend, first, that the calculation of the reduction makes use of an accounting trick to reach the agreed-upon ambition: By only counting the “territorial” emissions resulting from production and consumption, the EU calculates its carbon emissions without regard to those that are created by the production of goods and services in third countries. Furthermore, this trick is of increasing importance as the EU’s imports have significantly increased and carbon leakage (i.e. the process whereby carbon intensive industries vacate the EU because the production cost of their goods or services are too high as compared to third countries) has taken place on a larger scale.
Second, the objective is a net reduction of emissions. This means that the announced reduction will in no way represent the real reduction in polluting activity. Instead, to calculate the reduction in emissions, the EU will take into account the amount of carbon offset by, for instance, the financing of carbon sink projects and massive reforestation. However, reforestation, for one, is a contentious issue among scientists as it remains unclear to what extent it really does offset the pollution caused by carbon intensive industries.
Further, this agreed goal should be the subject of a forthcoming law that will set in stone the new ambitions, making it more difficult to avoid them. And if indeed anchoring the newly-reached goal should have a broad and transversal effect, politicians hope it will prompt more widespread mobilisation in the upcoming decade.
For these watered-down ambitions making use of dirty accounting tricks that will make the EU fail to play a leading role in combating climate change globally, ideu gives a thumbs down. You can certainly do better and more ambitiously, if only for your citizens and next generations of Europeans.
5. The Digital Services and Markets Act of the EU
In a much-anticipated package, the EU has managed to take the lead again in competition policy of Tech Giants and Platform Media. As regulatory authorities seemed more and more incapable of addressing the huge societal, political, social and economic consequences of big tech, the EU reacted with brand-new laws that seek to expand the exhausted Treaty rules on competition. Up to now, these rules failed to adequately tackle unfair business practices and to limit the detrimental impact of Tech Giants on European democracy.
By tabling these proposals, the Commission hopes it will complete its toolbox for the enforcement of antitrust law. This happens in a context where Tech Giants are increasingly accused of failing at moderating content and engaging in unfair business practices while disrupting and undermining democratic processes. But while authorities recognise the problem, regulators feel powerless to address tech giants’ harmful practices with current enforcement tools. That is why the Digital Services Package will impose on so-called Gatekeepers (i.e. “large online platforms” that have a “strong economic position”, “a strong intermediation position” as well as “an entrenched and durable position in the market”) a number of obligations; such as to provide users with access to data they generate on the platform, to provide platforms with the necessary tools and information to moderate and carry out independent verification of publicity and content hosted thereon but also to avoid treating products and services offered by the platform more favourably in ranking than services and goods offered by third parties, etc.
In a similar vein, the U.S. Federal Trade Commission and 46 individual States have recently also launched antitrust proceedings against Facebook for abusing its dominant position to “crush competition”. Sanctions could include a forced break-up of the company’s acquisitions (e.g. Instagram, WhatsApp).
It thus looks like Big Tech increasingly finds itself in a position where policymakers clearly signal that their actions are incompatible with both their market and democracy and cannot, therefore, remain uninhibited. Maybe appointing a Tech Ambassador for the EU, like Nathan van der Heyden proposes in this article on ideu, could be a complementary step in the right direction, Mr. Borrell?
While in the EU some critics do regret the fact that the forthcoming legislation does not go far enough, it is undeniable that the regulation already sends a stronger signal than most regulatory authorities around the globe would be willing to convey.
For this fight for free and fair competition, but more fundamentally for the core of our democratic systems, ideu gives a big thumbs up.
Blauberger & Martinsen, "The Court of Justice in times of politicisation : 'Law as a mask and shield' revisited", (2020) 27(3):382 Journal of European Public Policy
Buti, "A tale of two crises: Lessons from the financial crisis to prevent the Great Fragmentation", VOX, 13 July 2020, https://voxeu.org/article/lessons-financial-crisis-prevent-great-fragmentation (retrieved 31st december 2020)
Kelemen, "Europe's Other Democratic Deficit: National Authoritarianism in Europe's Democratic Union", (2017) 52(2):211 Government and Opposition
Scicluna & Auer, “From the rule of law to the rule of rules: technocracy and the crisis of EU governance”, (2019) West European Politics, pp. 1-23