The politics of austerity is back under the spotlight. On Wednesday, the leaders of the Austrian, German and Swedish social-democratic parties and trade unions met in Vienna, where they signed a joint declaration and strategic document called “A European pact for social progress”. Sigmar Gabriel, Secretary general of the German social-democratic party (SPD) called for the European political class to give a clear direction to the integration project. His concerns were echoed by Christian Kern, the Austrian Chancellor and leader of the FPÖ. Given the rise of far-right forces throughout the continent, Kern warned that “Europe stands at the brink of collapse”. Moreover, Gabriel argued that “the European integration project cannot exclusively rely on the Single Market”, but needs a true “social union”. The Secretary General of the German Federation of Trade Unions (DGB), Reiner Hoffman, said that the “European Union has to change its ways”. “Otherwise a failure of the EU will become a realistic scenario”.

Meanwhile, the President of the Eurogroup, Jeroen Dijsselbloem, criticized Commissioner Pierre Moscovici’s attempts to push for greater budget flexibility in the frame of the European Semester procedures. Dijsselbloem said that “the European Commission should just make sure that Member States do not breach the rules foreseen by the Stability and Growth Pact”. However, on Wednesday, EC vice-president Jyrki Katainen said that the Commission aims at topping up the current Investment Plan for Europe to €500 billion by 2020. Katainen’s remarks made it clear that fiscal capacity is becoming more and more an issue all over Europe. Indeed, on Wednesday, the Slovakian Secretary of state of public finances, Ivan Lesay, talked about the necessity of setting up a European and centralized fiscal capacity. The latter could work as basis for the establishment of a European wide insurance scheme against unemployment.

In other news, the Brexit debate continues to make the headlines in the UK. On Wednesday, rumours spread that Theresa May is likely to face a harsh defeat when the Supreme Court will rule over the appeal that questions the High Court’s recent decision to let the Parliament vote on Article 50. Moreover, a senior British member of the European Court of Justice said that the Court will ultimately have the last word on the matter. Meanwhile, the Mayor of London, Sadiq Khan, claimed that the Government is ignoring the concerns of the business world about the risk of losing skilled workforce from other EU member states in case of a “hard Brexit”. Khan warned that he might look for a “London specific” solution for its business community, should things go wrong. However, the President of the Eurogroup, Jeroen Dijsselbloem, warned that London cannot remain the centre of European financial affairs.

On Wednesday, the President of the European Council, Donald Tusk, publicly addressed 80 British conservative MPs who argued that the EU should clarify as soon as possible how it intends to deal with EU citizens living in the UK and guarantee their rights. Tusk retorted that any Brexit-related issue will be discussed once Article 50 is triggered by the UK–a decision that ultimately lies in the hand of the British political class. Theresa May hit back at Tusk, arguing that the EU Council President’s words confirm that UK citizens would be left “high and dry” even in a scenario in which UK Government were to guarantee the rights of EU citizens living in Great Britain.

The EU-Turkey relationship remains quite troubled: after weeks of diplomatic tensions, on Wednesday Turkish President Recep Tayyip Erdogan said that his country “has not closed the European Union book”. His comment came after the relations between Brussels and Ankara were put on ice by a EU Parliament vote last week. MEPs decided to block any talks linked to a potential future accession of Turkey into the EU. However, on Wednesday, the Turkish vice-president, Mehmet Simsek, said that the Europe remains a “source of inspiration” for his country.


“Sometimes it is worth questioning whether we are causing political damages as we follow through on austerity”.

Sigmar Gabriel, Minister of Economy of Germany

Source: Handelsblatt, 29.11.2016

“The euro area is made up of many different countries, which implies different fiscal policies in 19 countries. But if the crisis has clarified one thing it is that many Member States did not have sustainable fiscal positions. There was no fiscal space to combat the crisis”.

Mario Draghi, President of the European Central Bank

Source: ECB website, 30.11.2016



The percentage of European citizens who believe that globalization represents an opportunity.

Source: Politico Europe, 30.11.2016

9 out of 10

The portion of Greeks who believe that their country is heading the wrong direction.

Source: Ekathimerini, 30.11.2016

Photo Credits CC European Council

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