A European politics is born

The European Union has so disappointed, fatigued, and wagged its finger at its citizens that, in the end, no one pays it any attention. Unfair or not, the reality is there, but it is a mistake to believe it has shortened the bureaucratic lifespan of a lost ambition. Shaken by the financial crash of 2008 and threatened with the bankruptcy of Greece and Ireland, the Union has been forced to cope with so many of these crises and rebounds, that, rather than stagger off to die, it has taken its first breaths as a political Europe.

On the eve of this Friday’s European Council that will consider the Franco-German propositions for a common economic pact, the European right and left met last weekend, in Helsinki and in Athens respectively, to discuss this pact, whose guiding principle was drawn up by Nicolas Sarkozy; its substance was laid down by Angela Merkel. The European People's Party, on the right, had little to say, as it could not contradict the two leaders. On the left, however, the Party of European Socialists (PES), has not only assailed a text that is "guided," it said, “by the desire to institutionalise austerity and weaken our social models and social security systems", but has also made counter-proposals that it says are "socially responsible and economically credible."

Social democratic parties are getting back to their roots

The PES wants the development of a "European industrial policy" to create jobs through future investments; the adoption of common social standards, including a minimum income in each country; the establishment of a “green tax” and a tax on financial transactions of 0.05 percent, which "would generate €200 billion in additional revenue per year”; the issuance of “eurobonds”, which would be European loans to finance cross-border projects and to jointly manage some public debts; and finally, it wants financial aid made to troubled member states to be renegotiated to lower the interest rates that were imposed, and it wants their repayment periods to be extended.

Keynesian at heart, these proposals from Europe’s social democracy, in the purest tradition of the reformist left, aim both to boost growth and rebalance public accounts by increasing purchasing power and creating jobs, to promote social and economic cohesion among EU states, and to encourage industrial development through public investment.

This is the first draft of a pan-European programme from the European left, whose adoption was made possible by the decline within the PES of the social-liberal currents, weakened by the Wall Street crash, and more generally speaking, made possible too by the grand comeback of ideas for the political regulation of the markets. From Scandinavia to Germany and Britain, the social democratic parties are getting back to their roots, while the European right are tempering their liberalism, in both Berlin and in Paris.

A return to power in 2012 and 2013

Not only has the political climate in Europe begun to change. More importantly, after three years, the idea of common economic policies has been gaining ground in the Union, with the acceptance by the 27 of the principle of a "common economic governance”, the continuity of the financial solidarity funds set up to save Greece from bankruptcy, and now, reflecting this evolution, the idea of the Franco-German pact, to which the left are proposing their alternative pact.

Though its outline remains hazy, the EU is itself becoming a democracy in which a majority (in this case, the right) is formulating a pan-European policy, which the European opposition is contesting by advancing its own notions. Still uncertain and fragile, a metamorphosis has already begun there, all the more striking since it is the fruit of necessity and therefore so much stronger than the simple expression of reliance on voluntary action to maintain the institutions.

Paradoxically, it is these developments that are federal in nature and that are leading only to a weakening of the community institutions in favour of the big states that will likely help the German and French left – coming ever closer, still in league after having been so far apart – to return to power in 2012 and 2013.

Without our having seen it, nor even wanting to believe it, the Union has begun to steam ahead and, just as there are already joint meetings of the German and French governments, the French Socialist Party and the German SPD have confirmed in Athens that their leaders will hold joint sessions now. Faced with what is taking place in the government of Europe, a shadow cabinet – a European government opposition – is being established.

Translated from the French by Anton Baer

Finance

MEPs want to tax transactions

On 8 March, MEPs gave “strong backing to the introduction of a financial transaction tax in Europe " by 529 votes to 127, reports theFinancial Times. But the vote in the European Parliament is not binding, the newspaper makes clear, and the European Commission, whose job it is to propose legislation to bring in such a tax, has called the idea "premature." By summer, however, the FT adds, “Commission officials are due to present their conclusions on the various options for taxing the financial sector by the summer. They are also considering a financial activities tax, as well as a financial transaction tax, among the possibilities.”

When it comes to the individual states, saysLe Monde, "Germany and Austria have long defended drawing up such a tax, but other European countries fear it will lead to an outflow of capital if it is adopted at the level of the euro area alone." France, which is chairing the G20, plans to propose this tax at a global level at the next summit of the group.