top cx logo
cx logo
Explorearrow down
search icon
arrow down

It’s nonsense to say ‘we’re not leaving Europe’

Karel Lannoo, the CEO of leading Brussels think tank the Centre for European Policy Studies (CEPS), gives Connexion his views on Brexit, the EU’s future and the new hopes brought by Mr Macron’s election.

So, with Macron’s election it seems there has not been the feared ‘domino effect’...
No, the British domino fell on one side and the others on the other. The German elections will also go as expected. Then there are the British and Italian ones, though we know more or less how the British ones will work out. So, yes, the election brings new hope, and is very symbolic. We now look at the glass as half-full. But I would temper that a little. One man can change a few things but not everything. However, his view of the world may have an impact on many others. We must remember though that 10 years ago Sarkozy also came on a wave of big expectations. It was thought he would bring renewal, but after a few months we saw he was full of himself and on many issues he was pursuing a French Gaullist agenda and didn’t care what the EU was saying, prolonging the way Chirac had dealt with the EU. For example, on the Maastricht Treaty he said he couldn’t care less what the Commission dictates and said he didn’t mind if the French budget deficit was more than 3%. Will Macron follow the Commission’s guidelines more? Will he say ‘if the Commission says this, I should do it?’, which France has never done...that we’ll have to see.

You think that is necessary?
It’s necessary and important. The whole French apparatus for the last 20-30 years has thought ‘we don’t care much about Brussels, we don’t have to follow its orders’. I had dinner recently with the official in charge of the unit that writes reports saying ‘the country should do this and that’ and he said ‘we have nothing to say to France’. Meaning that we write the report but when we check in two or three years, nothing has happened. We can have a lot of hopes that things will change towards a more federal Europe but France is very souverainiste, like the UK.

What do you think of his call for a euro zone finance minister and euro zone parliament?
These are interesting things, which have been discussed for some time by think tanks like ourselves. But France will not have everything his way. There are 19 or 20 other euro zone countries involved.  France can’t dictate, for example, ‘we want so-called blue bonds, issued by a European-wide federal finance ministry’. In that case, the Germans will want tight controls on budget deficits and debt. If southern European countries think this is a nirvana and a way to have lots of spending, Germany will say no. The good thing is Macron is open to discussions on these things, because we need to advance. We need to move towards a more common budgetary policy, with the budget more tightly controlled by Brussels, but the powers of Brussels have to be accepted by the states for that. Mr Macron has expressed concerns about Germany’s trade surplus – some people think the country dominates too much. That comes into the idea of a finance ministry – creating a more common, European-wide budget. Why has Germany got a surplus on its current account and exports? It’s a competitive economy and it’s benefited from monetary union and stable currency relations with countries around it. But if it’s got huge surpluses, it should use these to invest in the countries it benefits from, to push them up.

So a more federal Europe is needed?
Yes, but in that case we need more control by the Parliament of what the Commission is doing – and that’s what the Commission doesn’t like.
There are fundamental things in the functioning of Parliament, Council and Commission that need to be discussed. The Commission has sole right of initiative for all proposals of legislation. I don’t think this is totally normal. In the USA, the Congress proposes laws. The White House makes suggestions. But in Europe it’s the Commission, which is not controlled by democracy.

What is needed to give ordinary people more confidence in the EU?
More accountability, transparency and control. MEPs are seen to be weak. Even the budget is set by the member states who agree how much they contribute on an annual basis. They can’t set a tax level to control the EU’s revenues. That’s a fundamental difference from national parliaments. People also get irritated about the many perks and benefits of EU officials. They should be treated like normal civil servants, whereas today they are much better treated than any national one. For example, their very limited taxation and their pension benefits, meaning there’s no one in the private sector as well paid. In the context of Brexit, Britain is expected to have to pay for its nationals’ pensions, but it’s a huge amount. There should also be more accountability for those in charge, who should be nominated by the Parliament: the presidents of the Commission and the Council, Juncker and Tusk. And the commissioners should be delegates from the Parliament.

Mr Juncker says the Commission will aim to reduce the number of new laws it proposes because some people think it over-regulates.
They say they want to do less, but better, but we’ll have to see if it’s really the case.

Is Brexit the biggest disruption right now?
It’s certainly a big disruption and it distracts our attention from more essential things, like our relations with the US, Asia and Africa, Turkey and the Middle East. Brexit remains a huge problem to overcome, a huge blow. Britain was the second-largest state in GDP – 16% of the EU’s GDP. I think we will overcome it. The other states may realise we’ll have to act more together, rather than being dispersed as we’ve often been. The signs are that we will manage it but it’s not guaranteed.

Are you disappointed that Britain is heading for a ‘hard Brexit’?
Some things are hard to swallow for Britain – the Commission takes a hard line on not moving to discuss the future relationship before a commitment on the payment. As soon as a paper like The Sun says ‘we will not pay a penny’, it will be difficult to push through the 15, 20, 30 billion, to be paid in addition to the usual annual contribution. To convince the British public will be difficult due to the xenophobic British media – but if you were part of a club, you are part of paying the commitments of that club. For example thanks to Britain’s AAA rating, the European Investment Bank was able to borrow in the markets at a lower rate. The others see this as a new cost because borrowing costs will increase. It’s a big pity the UK is leaving but overall I’m hopeful for the future of the EU. We’ll have to have a special bilateral agreement and Britain will have high expectations of it and the EU will have low promises, because they want to make sure the others are happy first. If they give too many concessions, countries like the Czech Republic and Poland, which are not very pro-EU, will say ‘we want the same’, and your cohesion is gone. I find it nonsense when May says ‘we’re not leaving Europe’. Yes, of course in the geographical sense, the island will not float away. But they are leaving Europe because they are leaving all the institutions and the difficulty in the future will be to continue to have interaction in policy-making at European level: standards for phones and cars and financial business, etc. Today the Brits are involved at all levels, tomorrow not at all and at no level will their interests be taken into account. They will simply be some island somewhere, not connected to the continent. For the City of London, it’s bad. And it’s bad for the EU because Britain is an important country.

Resident or second-home owner in France?
Benefit from our daily digest of headlines and how-to's to help you make the most of life in France
By joining the newsletter, you agree to our Terms & Conditions and Privacy Policy
See more popular articles
The Connexion Help Guides
featured helpguide
Income Tax in France 2023 (for 2022 income)*
Featured Help Guide
- Primarily aimed at Britons, covers pensions, rent, ISAs, shares, savings and interest - but also contains significant general information pertinent to readers of other nationalities - Overview of online declarations + step-by-step guide to the French printed forms - Includes updates given automatically after this year's site opened
Get news, views and information from France