Arnaldo Abruzzini writes that Europe’s ambition to gain a “social triple A”, by providing high quality jobs and a system of social protection is admirable. However, this ideal would not be sustainable unless it also strives for an “entrepreneurial triple A”. The pursuit of competitiveness has been a basic principle of the European project since its origins. But it needs rebooting. Particularly, it needs to support small and medium enterprises’ efforts to expand beyond Europe, which will be the source of 90% of global growth in the next decade, according to the Commission.

Marco Torregrossa thinks that the Pillar of Social Right is heading the wrong direction in seeking to support full-time contracts as the norm. As the World Employment Confederation Europe writes, stricter Employment Protection Legislation (EPL), as measured by the OECD, leads to longer unemployment periods and a lower uptake of entrepreneurship. While protecting employees by reducing the risk of job loss, EPL also increases the cost of job loss by reducing the “back to work” rate from unemployment. Good social rights do not automatically go hand in hand with permanent contracts. Employees are increasingly split between burn-out and bore-out, facing either psychological stress because of overwork or lack of rewarding tasks to perform. Rather, we need a policy environment that promotes customized contractual arrangements as a means to increase labour market participation and inclusion.


Susan Milner argues that Emmanuel Macron’s current approval rate is surprising for a young candidate not supported by any of the traditional parties, but this is a sign of our times, in which many people believe that all politicians are corrupt. His weaknesses lie in a lack of programmatic depth–which, however, he still has time to address–and in an aspirational image largely limited to more affluent social groups. Whether he can sustain the momentum built up so far will depend on how wide he can keep the centre ground under attacks from the French centre-left and centre-right.

For Beatriz Becerra Basterrechea, Macron is a kind of anti-Trump and his victory in the presidential election would be the victory of Enlightenment values against the populist threat. According to any communication advisor, a candidate standing for election should never speak about Europe. Contrary to other political leaders that started mimicking populists, Macron, always talks about Europe, also linking France’s problems to their global dimension. Catherine Fieschi is convinced that there will be no president Le Pen. While Fillon’s troubles have given Le Pen a boost, the two candidates’ electorates are vastly different, so any advantage to her will be marginal. Moreover, due to Macron’s candidacy, the Front National no longer has a monopoly of renewal (although this is partly an “optical illusion”). The FN threat should, however, still not be underestimated in its capacity to mobilize voters, but there is still hope for a different kind of renewal.


On Bruegel, Silvia Merler reviews how eminent economists reacted to Peter Navarro, head of the US National Trade Council, who has recently accused Germany of currency manipulation. Paul Krugman argues that Navarro is only partly right, because while Germany does benefit from the euro’s devaluation, but there is no indication that this is caused by Germany’s influence. Jeromin Zettelmeyer thinks that Navarro’s claim is baseless because euro membership did not reflect any decision, on behalf of the German government, to steer its exchange rate and Germany’s competitiveness is not a structural feature of its euro membership.

Frances Coppola believes that the euro is indeed undervalued for Germany, but it is also overvalued for other Eurozone countries. If the common currency were to break up, Germany’s restored currency would appreciate, but other restored currencies would depreciate and, overall, the US would gain little. Moreover, Navarro is de facto demanding currency manipulation, as he would prefer that the euro be artificially maintained above its market level. Laurence Kotlikoff also thinks that there is no ground to argue for currency manipulation by the ECB based on money supply data. Again, the US is more guilty of this charge, as the Fed has spent the last decade trying devalue and, thus, manipulate its currency to make US goods and services cheaper.

This Ideas Monitor is by Carlo Burelli and Alexander Damiano Ricci

Photo Credits CC PES Communications

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