On Wednesday September 13, the President of the European Commission, Ursula von der Leyen, insisted in her speech on the State of the Union on the ecological, economic, social, geopolitical and migratory challenges: continuing the European Green Deal, making the transition successful. energy, obtaining peace in Ukraine, preserving biodiversity, achieving a just and equitable transition, a more complete union, which defends and protects, human but secure, united but sovereign, etc. The speech was prolix on the ends. But where are the means?
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European public finances remain locked in an infernal triangle, with revenues limited by the tax competition that the States of the Union continue to engage in (lack of fiscal union), expenditure restricted by a deficit rule of less than 3%. of gross domestic product (GDP), which the reform of the stability pact will not eliminate, and a debt which, above 60% of GDP, exposes itself to sanctions, if not to strict guidance of public action. The “more complete” Union, desired by the President of the Commission, does not seem likely to extend to the fiscal and budgetary areas.
Is it then desirable for Europe to acquire a higher debt capacity? First, it is clear that it will not do so within the framework of a fiscal union. This is what the President of the European Commission means, among other things, when she says: “We must not wait to modify the treaties, we can adapt existing law. » Europe will therefore probably never succeed in pooling its sovereign loans and creating the “risk-free asset” (or perceived as such), which investors would nevertheless want, and which would reduce the risk of a sovereign debt crisis. .
Permanent financing capacity
Pessimistic vision, will retort the most confident, because the EU was able to find an alternative, proposed by France and Germany, and compatible with the treaties, when it was necessary to finance the Next Generation EU recovery plan: for the first time , the European Union borrowed in its name via the European Commission, with the aim of raising up to 500 billion euros in subsidies distributed between member states to support their recovery efforts and investment in the ecological transition, energy, digital, etc. In this same vein, the Bruegel Institute insists, in its note of September 12 European Union debt financing: leeway and barriers from a legal perspective, on “the great flexibility [qui existe] to use borrowed funds, whether through new extra-budgetary funds such as NGEU [Next Generation EU] or within the budget.
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