12 European States Revolt Against Merkel, Macron Plan To Reform Europe
by Tyler Durden
ZeroHedge.com
Fri, 06/22/2018
Two days ago, when we laid out the components of Merkel and Macron’s blueprint to reform the EU, we said that while “Macron suggested the proposal will be presented to other countries, with specifics to be worked out later this year and the plans to take effect from 2021, it was unclear how he plans to get “other countries” to vote for a proposal which has already led to the alienation of Central and Eastern Europe, Brexit and an openly populist government in Italy.”
We did not have to wait long for confirmation, because just two days later, Europe’s two self-proclaimed leaders were facing an unexpected backlash from most other European governments against the German and French plans for a common eurozone budget, dealing a blow to the two countries’ ambitions for a big overhaul of the single currency area.
As the FT reports, the rest of Europe’s “core”, including the Netherlands, Austria and Finland are among 12 governments questioning the need for any joint eurozone “fiscal capacity”, challenging a central tenet of French President Emmanuel Macron’s vision for the eurozone that he has successfully pressed Berlin to endorse.
As we reported on Wednesday, increasingly unpopular French president Macron and the politically embattled Merkel tried to restart their close collaboration this week ahead of a wider summit of EU leaders. They agreed that a new common pot of eurozone money could be funded by a mixture of national contributions and new EU levies, such as a financial transactions tax.
Ironically, while their agreement supposedly forms part of a broader deal between Paris and Berlin on how to strengthen the currency bloc, the rest of Europe generally disagreed, which incidentally is also the reason why any attempt at “Federalizing” Europe is doomed to failure: Europeans tend to frown upon self-declared “master states” who tends to decide for everyone else, even if these states end up paying for much of the outlays (largely thanks to the presence of the EUR and the absence of the DEM).
As a result, EU diplomats said Merkel’s concession to Macron – as a reminder, having found herself isolated at home, Merkel has been forced to see support abroad – had emboldened other countries to resist the blueprint, out of concern that it would leave their taxpayers too exposed to problems in crisis-hit member states. And, as the FT writes, the splits were observable at a meeting of EU finance ministers in Luxembourg on Thursday, with increasing signs that governments have formed competing camps with distinct visions on the direction of further integration.
The Rest…HERE
