State of the Union »

• Ireland paves the way for Tony Blair?

  October 2, 2009 @ 8:43 pm | by Jamie Smyth

   

  Well, polling day is finally upon us. Thank god because I’m not sure I could face writing another article about the intricacies of the Lisbon treaty. One contact in a political party in Ireland told me at 7pm tonight their private exit poll is for a 60 – 40 yes vote. I think it will pass ok, but I suspect it may be closer.

  I think Czech president Vaclav Klaus will also be forced to sign- it’s not easy to stand alone against 26 states when your own parliament has already ratified a treaty. This means Lisbon entering into force by January 1^st 2010 and the nomination of the first European Council president.

  I’m just back from meetings with a few senior EU diplomats and a top commission official, who all say their money is squarely behind former British prime minister Tony Blair for the plum job. The British are pushing him hard. Sarkozy seems to be awestruck by the suave French speaking Brit and even Merkel is apparently softening her stance- in part because there are few other high calibre candidates.

  Personally I’m not so sure Blair will survive the horse trading that goes on in choosing any top EU job. But all the speculation begs the question would Blair he be any good at it?

  Blair is clearly talented and a wonderful communicator. He was instrumental in making the Labour party electable once again and everyone in Brussels remembers his fine pro-European speech to the European parliament at the start of the Britain’s EU presidency. But despite all the fine words about Europe when he was prime minister he never attempted to tackle euroscepticism in Britain. 

  Blair is a chameleon, according to people who have done business with him. “When you sit down with him he usually tells you exactly what you want to hear but whether you ever get what you want is another thing,” says one source. That’s probably one of the skills that helped him manage the peace talks in Northern Ireland, which must go down as his single best achievement to date. In fact, Blair as president of Europe would suit Ireland. He has done more for British-Irish relations than probably any other British leader. His wife and kids have Irish passports. And he even managed to apologise for the Irish famine! 

  But I’m simply not convinced he can be forgiven for teaming up with George Bush to invade Iraq. This decision cost hundreds of thousands of lives in Iraq and led to the deaths of thousands of British and American soldiers. It also deeply divided the EU and raises questions about Blair’s commitment to Europe.  He also has another Iraq inquiry hanging over his head in Britain. Will EU leaders risk giving such a controversial figure the first go at European Council president?

   The job is unelected but public opinion across Europe may not be quite as enthused about Blair as Europe’s current crop of leaders. A charismatic figure like Blair may stretch the mandate of the job, which is meant to be more of a figurehead than an activist president. This could be bad for small member states, which see the European Commission as their ally when it comes to defending their interests against the big 3- France, Germany and Britain.  

  Finally, would Blair be the right man when it comes to dealing with a eurosceptic David Cameron-led government? Some say he could act as the bridge to bring Britain back from the cold. But I suspect Cameron may find it difficult to make the type of compromises he will be called upon to make with Blair in the top seat.  Maybe the EU should walk before it starts to run with this job- forget the superstar and appoint a backroom boy like Balkenende, Gonzalez or Junker.

• Should Barroso get the nod this week?

  June 14, 2009 @ 7:53 pm | by Jamie Smyth

   

  It’s going to be a long week for the EU legal eagles and a horrible one for journalists. The agenda of the European Council is stuffed full of so many complex legal issues that by Friday afternoon my head will be spinning trying to decipher the formal summit conclusions. 

   First up is what to do about Mr Barroso: to nominate or to intend to nominate? That is the mindbogglingly nerdy question exercising some of the finest legal brains in Brussels right now.

   The French, who aren’t always noted for their strict adherence to community law (remember that ugly spat with the Czech’s over outsourcing car production), want a political rather than a legal decision to be taken on Barroso’s nomination. A legal decision should wait until the Irish vote and Lisbon can enter into force.

   The French argue that formally appointing Barroso under the terms of the Nice treaty but then waiting until the Lisbon treaty enters into force before appointing the rest of the commission is “legally dubious”.

  A formal nomination could also pose problems if the Irish reject the Lisbon treaty a second time. If Barroso already has his job it means Portugal already has a commissioner yet under the Nice treaty the size of the commission will have to be reduced by at least one member- so why should Portugal be the only state assured of not losing their commissioner between 2010-2014?

   Of course, French objections aren’t entirely based on legal concerns. They want to keep the pressure on Barroso for as long as possible to help them land a plum economic portfolio in the commission. The Germans, who have a general election in September, also fancy a delay as they don’t know who they will send to the commission and therefore aren’t in a position to lobby for commission portfolios. The fear is that by then all the good jobs in the commission will have been snapped up as member states engage in the inevitable rush to nominate commissioners as soon as Barroso is reappointed.

   I’m all for good legal arguments but the logic of the Franco-German wears a little thin given that if the EU followed the strict letter of the treaties a new commission president should be appointed under Nice along with the rest of his commission team- albeit with one less commissioner. After all, who knows if the Irish will vote yes and the Czech and Polish presidents are going to sign the treaty allowing it to enter into force in 2010?

   Whatever Barroso’s faults, and he has a few, it makes no sense to destabilise the commission at such a sensitive time with a global economic crisis still raging and a crucial climate change deal still to be agreed this year. In this I agree with the Swedes, who are anxious there is a strong president to help them during their EU presidency beginning in July.  

   Of course, the real shame about the current debate about  nominating Barroso is that there aren’t any other serious contenders for the job. The Socialists are completely split on the issue (former Danish PM Poul Nyrup Rasmussen couldn’t get British, Spanish or Portuguese backing) while the Liberals simply don’t have the weight to get behind former Belgian PM Guy Verhofstadt. This unfortunately leaves EU journalists writing lengthy blogs about complex legal processes rather than personalites- sorry! 

         

• Will EU financial reform go up in smoke?

  May 27, 2009 @ 2:38 pm | by Jamie Smyth

  

  Things are certainly hotting up in Brussels these days.

  Today the European Commission headquarters has been evacuated for the second time in ten days. A hot water pipe burst spewing water into the lift shafts and the electrical systems. There was no fire this time around but commissioners, officials and journalists were forced to scramble out of the building just as commission president Jose Manuel Barroso proposed a radical reform of the EU’s financial system.

  As we all milled around outside one journalist joked the disturbance may have been a British plot to torpedo the new commission proposals to create a new pan-EU wide system for supervising the financial markets.

  The British government fears that a proposal to give a new European system of supervisors the power to overrule national regulators will prompt a eurosceptic backlash at home. The City of London is already up in arms over a separate proposal to establish a new EU system to closely regulate the activities of hedge funds. The prospect of a new EU regulatory authority telling its own Financial Services Authority what to do will send shivers down the spines of UK politicians.

  The proposals must be agreed by EU leaders and the European Parliament before they can come into effect. But Britain may find it difficult to block the reforms given the scale of the financial crisis unfolding in Europe and the obvious fact that national regulators failed so miserably to regulate their banks.

  There is clear logic in setting up pan-European regulation given that big European financial institutions operate on a cross border basis. In other words, if you have an internal market for financial services then you need to have a supervisor that can see what banks are doing in different states.

  At the press conference today McCreevy noted how one national supervisor told him that it first heard that a multinational bank based in the country was in financial trouble by reading press reports in the bank’s home member state.

  I presume he was talking about Dublin-based Depfa bank, a subsidiary of the German property investor Hypo Real Estate. The German taxpayer is footing the bill for Depfa’s largesse. The cost has reached €102 billion and is still rising.

  The commission’s proposals on financial reform are tapping into the “Never waste a crisis” philosophy articulated by Barack Obama’s chief of staff Rahm Emanuel. If it can’t be done now then it will be never be done, said Barroso.

  But given the importance of banks to national economies many EU states will be nervous about giving a new EU supervisor legally binding powers over their own regulators and by extension their banks. A huge political struggle lies ahead with the first round due to be slugged out at next month’s EU summit.