At Thursday’s European Council summit in Brussels, European Commission President José Manuel Barroso will present figures that Süddeutsche Zeitung describes as “worrying”. In 2013, nine of the Eurozone’s 17 member states will take on higher levels of debt than those allowed by convergence criteria, while European economic growth has almost ground to a halt, and one in eight Europeans is without a job. European Council President Herman von Rompuy has proposed devoting several hours to debate reforms that are likely to reverse this trend. A “group therapy session”, writes the newspaper, in which some of the participants will feel very uneasy —
In the Council building on Thursday evening, the 27 leaders of Europe’s member states will sit down to listen to what European Commissioner José Manuel Barroso has to say about the situation in Europe. The ‘action teams’ that he established to promote youth employment in Spain, Greece, Ireland and five other countries will have some good news. But none of David Cameron’s colleagues will want to be in the shoes of the British Prime Minister when he has to hear that in 2013, his country’s debt will be higher than the debt of Spain or Ireland. Thereafter, all eyes will be on French President François Hollande, when he has to admit that he will be unable to meet France’s deficit target for 2013.
In contrast, Germany is once again expected to show itself to be a model student. The Financial Times reports that the 2014 budget which was announced by Finance Minister Wolfgang Schäuble this week, ahead of the expected date, includes a number of cuts designed to balance the country’s books by 2015. “Berlin wants to show the way,” even if it leads to friction with countries which want to rein in austerity and invest in growth, notes the daily. Germany —
fears its eurozone partners will abandon fiscal rectitude if they see Germany blink domestically. […] Yet the economic case for more belt-tightening is weak. While the fiscal deficit is low and public debt manageable, the economy is slowing down. […] Were the locomotive of Europe to be put back on track, its struggling partners would follow. […] Germany has an obligation to do more than simply insist on eurozone-wide austerity, which is proving self-defeating. The best way to lead the eurozone by example is to kick-start a recovery.