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Politico Europe - 21 06 2018
Politico Europe - 21 06 2018
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B R E X I T: T WO Y E A R S A F T ER T H E VOT E | J U N E 2 1 -2 7, 2 0 1 8 | VO LU M E 4, N U M B ER 2 3
ISSN 2406-5250 | DAVID VINTNER / THE SUNDAY TIMES MAGAZINE VIA NEWS LICENSING
Nigel
Farage’s
last laugh
BY CHARLIE COOPER IN LONDON | PAGES 17-20
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2 POLITICO JUNE 2, 2018
EU
BRUSSELS BUBBLE
COnFIDEnTIaL
Brussels
cocktail bar,
is celebrating
The European Commission this week is officially its second
awarding the Altiero Spinelli Prize for “outreach” anniversary
to 22 people, who will receive cash prizes of up this week by
to €50,000. One group of second-prize winners opening a store
for all your
plans to use their €30,000 with immediate effect:
home cocktail
Roberto Castaldi of the “Collective Pro-EU Appeal needs, opposite
and March for Europe” told EU Confidential the the bar on
group has enlisted the Union of European Feder- Rue Antoine
alists to organize a protest aimed at … EU leaders. Dansaert.
PRESENTED THIS WEEK BY MARTENS CENTRE BY RYAN HEATH AND GABRIELA GALINDO
Listen to the podcast New episode every Friday | Soundcloud: soundcloud.com/politicoeuconfidential | Apple devices: Search podcasts for EU Confidential
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SUMMIT 2018
OCTOBER 8-9, 2018 | Campus Biotech, Geneva
POLITICO and Le Temps are taking you back to Geneva on October 8-9 for their 3rd Annual Health Care Summit,
where the industry’s top minds together with key policymakers, scientists, and patient representatives will examine
the promises of prevention in making our health care systems fit for the 21st century.
SORINA PINTEA
MINISTER OF HEALTH, ROMANIA
RIINA SIKKUT
MINISTER OF HEALTH AND LABOUR, REPUBLIC OF ESTONIA
JAYASREE K. IYER
EXECUTIVE DIRECTOR, ACCESS TO MEDICINE FOUNDATION
CARLO PETTINELLI
DIRECTOR OF CONSUMER, ENVIRONMENTAL AND HEALTH
TECHNOLOGIES, DG GROW, EUROPEAN COMMISSION
Career track
ON TO LUXEMBOURG: Viviane Reding, protocol at the European Commission. Antonio Lesina is now senior vice president Rodríguez-Toquero is going to the European
a center-right MEP and former European of international external and regulatory affairs Commission. Mateo Domecq has left to
Commission vice president, will leave her RECRUITMENT SPECIALIST: Paul and Antonio Amendola is now executive work for a judge at the Court of Justice of
Parliament post in September to run in the Adamson of Flint Global is now a senior director for EMEA regulatory affairs. the EU.
Luxembourgish general election. adviser at European Affairs Recruitment
Specialists. LEGAL LEAVINGS: At Hogan Lovells, BANKING: Malte Kilian has joined
PROTOCOL PROMOTION: Pernilla Sjölin Mélanie Perez is about to leave to go to Deutsche Bank as assistant vice president in
has been promoted to deputy chief of TELECOMS MOVES: At AT&T, Karim Wilson Sonsini Goodrich & Rosati. Jaime government and public affairs.
SPONSORED JOB
P OL I T IC O SPR L
A JOINT VENTURE BETWEEN
POLITICO AND AXEL SPRINGER
EX EC U T I V E
John F. Harris
Managing Director SFC EDITOR IN CHIEF
Matthew Kaminski
'74GRTGUGPVCVKQP1HƂEG EXECUTIVE EDITOR
IRELanD’S
BREXIT
DIVIDEnD
Momentum is gathering on both sides of
the border for the reunification of the island
The history of Ireland could one day be divided into two eras:
before the Brexit referendum, and after it ¶ Until Britain voted
to leave the European Union, the idea that Northern Ireland
would one day perform a Brexit of its own and leave the United
Kingdom to join the rest of the island in a single united Ireland BY NAOMI O’LEARY IN BELFAST
seemed at best a distant possibility ¶ Then came June 23, 2016. ILLUSTRATION BY PETER STRAIN FOR POLITICO
Turkey’s
opposition
might actually
have a chance
Firebrand teacher brings the fight to
Erdoğan in Sunday’s snap election
BY ZIA WEISE
IN ISTANBUL
via Bayer
“Together we can
tackle climate change.”
Gregorio Magno, Founder of Ciclogreen, Spain
Angela
rises from
the ashes
BY MATTHEW KARNITSCHNIG
German IN BERLIN
Mother
of all EU
summits
If it’s a big, controversial issue in
Europe, it’s probably on the agenda for
the June leaders’ gathering
BY DAVID M. HERSZENHORN
qualcomm.com/weinvent
© 2018 Qualcomm Technologies, Inc. All Rights Reserved. Qualcomm is a trademark of Qualcomm Incorporated, registered in the United States and other countries.
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On the US-Mexico
border, children cry
and pressure builds
MATT HANCOCK
SECRETARY OF STATE FOR DIGITAL,
CULTURE, MEDIA AND SPORT
WEDNESDAY, JULY 4
@EVENTSPOLITICO
#PLAYBOOKBREAKFAST
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We invent.
The world
leaps forward.
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qualcomm.com/weinvent
Nigel
Farage BY CHARLIE COOPER
IN LONDON
and tonic
debating the EU’s budget, Farage get any better than that.” Political Action
is out for lunch. Some places in The U.K.’s vote to leave the conference in
this town don’t serve him, he says, EU two years ago this week was Maryland last
but this one, Invictus on Rue de the fulfilment of a 20-year obses- year.
and is
He is dressed in a dark gray tivist worldview — the icing on the
pinstripe suit, a stiff white shirt cake. Trump then hosted Farage in
and a spotty blue tie, and tucks his New York, fêted him and posed for
napkin into his collar as his fruit de a photo — the cherry on top. That
wondering
mer linguine arrives. photo still holds pride of place on
The man U.S. President Donald the desk of Farage’s Brussels office,
Trump dubbed “Mr. Brexit” freely facing inward so he can look at it
admits that, whatever comes next, while he works.
do next.
what had happened that year, and Farage talks a lot about a return
thinking the great secret with this to “frontline politics” if Prime
is to savor it. To never even believe
for one moment you could ever SEE FARAGE ON PAGE 18
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of subversion party.
“We’d just have to see wouldn’t
we. There’s UKIP possibilities,
a good look or a bad look. The as-
tonishing thing is if I go downtown.
I’m very careful in the evenings. We
politician.
“Would Sean Hannity in America
have changed more minds as a sena-
everything.” building.
“I high-fived Juncker!” he an-
nounces as he walks into the sun-
he can’t be too provocative against
[May’s] government by seeing me.”
He makes a point of giving inter-
side the Speaker pub on Great Peter
Street, about a 10-minute stroll from
the Palace of Westminster. Farage’s
dappled room. “I hope the photog- views on “Fox and Friends” when- driver-cum-bodyguard Martin (his
raphers got it, I’m sure they did.” He ever he can, and says he’s conscious team declines to give his second
pauses thoughtfully for a moment. when doing so of speaking directly name for “security reasons”) gets
“I’m sure they did.” to the president. He is on Fox a lot, out and opens the door for Farage,
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POLITICO 19
who heads in for a pint. too. Jones was one of the first people cording of Donald Trump’s voice, sion about the House of Lords. Dan-
He calls this his “sharpener,” and to help Farage gain an audience in introducing Farage on stage at an ielian picks it up: “LBC. What would
he has one before nearly every LBC America, he says. “Even though I election rally in Mississippi back in you like to say? ... Ok … And why do “‘Juncker
evening show. There is a seasoned
Westminster journalist who says that
may not agree with some of his stuff,
I stay loyal to my friends.”
August 2016: “Mr … Nigel …. Far-
age!”
you hate them?”
Emerging from the studio after
high five
they only ever took one bit of advice Then in comes Farage himself, the show, Farage banters with Jukes caught on
from Farage — a little alcohol before AFTER THE SHARPENER, MARTIN live on air. “Thank you Donald, and and Mitchell about how it all went. camera’ …
public speaking is a good idea. THE BODYGUARD/chauffeur drives good evening everybody!” “It’s actually an interesting form Goooood.”
Alongside Farage is Dan Jukes, his Farage and Jukes to the LBC studio He introduces today’s topic — the of the democratic process. Doing
press aide, who looks after the social overlooking Leicester Square. House of Lords — by quoting the that show is not dissimilar to walking ABOVE: PHOTOS
media accounts. He calls them the In the green room, Farage goes front page of that day’s pro-Brexit on the street and knocking on doors. BY EMMANUEL
DUNAND/AFP
“nuclear football.” through topics and timings with LBC Daily Mail newspaper. “TRAITORS IN I try and be very polite,” he says. VIA GETTY IMAGES
Farage doesn’t get quite so many producer Christian Mitchell and ERMINE!’ he reads. “Wow! I’ve said “You’re never nasty,” Jukes chips
stares here as in Brussels, but a few does a pre-recorded trail. He is good one or two things in my time about in.
people ask for selfies, and one man at it, hits his cues and doesn’t need the establishment and the pro-EU “Well, unless they are completely
who says he is a civil servant spots to do many retakes. He says broad- order, but they are really very, very cretinous. But I think talk radio plays
him from halfway down the street cast journalists used to call him strong words.” (Ermine is a refer- a very important part in the whole
and walks up to congratulate him on “one-take Farage” and attributes his ence to the fur lining of the tradition- democratic process. In America it
his work and complain that, as a gov- media profile over the years, partly, al gowns of members of the House is just massive. Every single state,
ernment employee, he cannot speak to being good at soundbites. He re- of Lords.) state radio, national radio, town and
his mind. “It’s worse than slavery if calls how a BBC correspondent in The night’s debate is over whether city radio. It’s just huge over there
your mind’s enslaved,” the man says. Brussels once told him other MEPs the Lords are exceeding their consti- and I think it’ll grow here. Interest
“That’s a great philosophy. You were complaining about the amount tutional role as an unelected revis- in politics is the highest it’s been for
should be in politics,” Farage replies. of coverage UKIP was getting. “He ing chamber, and instead seeking to decades.”
Over pints of Hophead ale, Far- said to them: ‘That’s because Farage overthrow the will of the people as
age and Jukes discuss what he’ll turns up on time, does it in one take, expressed in the Brexit referendum. WHEN AFTER 20 YEARS AS MEP,
cover on tonight’s show. Italy’s 5Star and there’s no fuss.’” He takes calls from those who Farage finally leaves Brussels in
Movement and the League are in He does an Instagram story and a agree and those who disagree, and March next year, there is only one
negotiations to form a government. photo for Twitter. LBC strives for balance. But he is thing he will miss, he says: “the cut
He knows both parties well, having “We do, even though it’s a radio most enthused when building his and thrust and the theater of the
previously been in a European Par- show, have to be aware of visuals,” own personal brand. Steve, calling chamber.” In another life, he jokes,
liament group with the League, and he explains. In the resulting pic- from Islington in north London, ar- he could have been on the stage — an
now chairing one which includes the ture, partly aided by Jukes’ iPhone gues against Farage’s wish for sweep- “end-of-the-pier show entertainer”
5Stars. Matteo Salvini, who has since X on ‘portrait mode,’ Farage looks ing House of Lords reform, accusing or a stand-up comedian.
become Italy’s interior minister, is reasonably tanned and healthy for him of wanting “revolution.” He can certainly deliver a line.
an old friend, Farage says. a 54-year-old who famously smokes “Absolutely,” Farage replies joy- “You have the charisma of a damp
“Italy’s interesting isn’t it? Social and drinks liberally. fully, conscious he’s got a soundbite. rag and the appearance of a low-
media in Italy is really big. Really, re- Is he cleaning up his act for life as “I am a revolutionary, a pinstripe grade bank clerk, and the question
ally big.” a media star? In Brussels recently, a revolutionary!” I want to ask is: ‘Who are you?’” —
In Beppe Grillo, the comedian fellow MEP asked him whether he On a good night he gets about a Google former European Council
who founded the 5Star Movement, was using a tanning cream. “I won’t hundred calls — more in one hour President Herman van Rompuy and
he sees a potential model for his tell you what I said to him, but it was than in three hours of other shows, one of the first results is a YouTube
new career outside the traditional two words!” Farage says. He declines says Assistant Producer Thomas clip of Farage declaiming him with
bounds of elected politics. to say what those two words were, Danielian, who is in the control these words in the European Parlia-
“What’s fascinating about Beppe but adds when pressed on the topic room tonight. ment in 2010.
is the extent to which he’s changed of skincare regimes: “I don’t use any- “Usually the lines are completely Despite his reputation among
Italian politics without ever even thing very special at all.” full the entire time,” he says. “He’s supporters as a straight-talking, old
standing for office. These traditional The radio show is a slick, compact great at steering them. Not all politi- school Englishman, Farage is a much
routes that people had to go down vehicle for Farage to talk about what cians can handle callers. He can.” more modern figure than many give
to change political thinking — it’s he wants to talk about. The phone rings again. Someone him credit for, acutely conscious of
out of the window now. It’s gone. Every episode starts with a re- else wanting to join Farage’s discus- the link between technology, the in-
It’s changed. Grillo proves that more ternet and populist politics.
than anybody. He’s never even Social media allowed his acts of At left,
stood, never even considered it.” subversion to reach an audience un- Nigel Farage is
American right-wing political imaginable in the pre-YouTube era. greeted by then-
commentators like Hannity, Rush For many British voters, the sight U.S. presidential
Limbaugh and Bill O’Reilly are of Farage attacking the Brussels es- candidate
the main inspirations though. He tablishment on democratic account- Donald Trump at
knows Hannity “reasonably well,” ability and, critically, immigration a campaign rally
and while he has not sought direct would have been the first time they in Mississippi in
advice, has “watched what people ever paid attention to the European 2016.
like him have done. He’s a very good Parliament. JONATHAN
example.” “YouTube was the great savior for BACHMAN/
GETTY IMAGES
InfoWars founder Alex Jones is me,” Farage admits, sitting in his Par-
also on Farage’s radar and he has at- liament office. He lights a Rothmans
tracted criticism in the U.K. for a re- cigarette. He’s not allowed to smoke
cent appearance Jones’ radio show, in here but has ignored complaints
which has promoted conspiracy the- about it from neighboring MEPs.
ories about, among other things, the “I remember thinking back in
Sandy Hook gun massacre. Farage 2006, 2007 — I’m coming over here,
is unapologetic. “People can scream I’m doing all this stuff, I’m making
and shout all they like. He is a phe- things happen and no one’s notic-
nomenon,” he says, and points out
that Trump used to go on InfoWars SEE FARAGE ON PAGE 20
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Germany’s Brexit point-man UK gives boost to crop Apple case heads to US EU watchdog: Eurozone
takes Colombia posting research Supreme Court shock absorber ‘insufficient’
The German government’s lead The U.K. government will provide a new The Supreme Court announced on June The European Commission’s plans to
coordinator on Brexit, Peter Ptassek, will funding package to research crop resilience 18 that it will review a class-action lawsuit introduce a €30 billion economic shock
leave the federal foreign ministry later and quality, Environment Secretary Michael brought against Apple by consumers. absorber to boost economic safeguards
this summer to become ambassador Gove announced June 15. Four agricultural Apple Inc. v. Pepper alleges Apple has for the eurozone are “insufficient” and only
to Colombia. Ptassek has been deputy research centers will receive around £5.3 monopolistic control over its app store serve as a “small stepping stone” toward
director general for European affairs since million over five years to develop new and gets a cut of the revenue from each an effective rainy day fund, the EU’s fiscal
2014, and works to coordinate national technologies and environmentally friendly app sold, thus playing a key role in setting watchdog said in a report published June
policy on the U.K.’s impending departure production for farmers and growers across the prices that app creators charge per 18. According to the European Fiscal
from the bloc between the chancellery, the country. The studies will focus on download. The court must decide if a third- Board, the fund should be a minimum of
and the finance, economic and foreign boosting productivity for pulses, wheat, party distributor like Apple can be sued €50 billion. The Commission’s “European
ministries. According to two ministry leafy vegetables and oilseed rape. The by consumers, even if the exact prices are Investment Stabilization Function” would
officials, there is no concrete decision government has invested £160 million determined by an outside seller. come in the form of loans under the next
on Ptassek’s replacement yet, but he is through the agri-tech strategy to harness EU budget, which would help safeguard
expected to relocate to Bogotá in August. the latest research and technologies. primarily public investment.
Warning over higher costs to London tube deal goes to Brussels OKs Comcast’s WHO updates international
stabilize German power grid Siemens Mobility proposed acquisition of Sky diseases classification
ARE YOU A Costs to ensure the stability of the German trainmaker Siemens Mobility beat The European Commission unconditionally The World Health Organization released a
POLICY PRO? Germany’s electricity grid increased by 59 off competition from its merger partner cleared the U.S. cable operator Comcast’s new international classification of diseases
Pros get percent last year to €1.4 billion, the German Alstom and a tie-up between Hitachi and acquisition of pay-TV operator Sky on on June 18. Gender incongruence is no
exclusive access federal network agency said on June 18. Bombardier to bag a £1.5 billion contract for June 15. After a one-month review, the longer listed as a mental health condition,
to real-time, The agency’s president, Jochen Homann, 94 new London Underground trains. The Commission granted approval on the a gaming disorder has been added to the
in-depth online said in a statement that the only way to deal was announced June 15, just days after basis that the transaction would not harm list of addictive disorders, and a chapter on
reporting, reduce costs is to expand the country’s officials at Alstom and Siemens submitted competition in any of the markets where traditional medicine has been included. The
customizable electricity network. Germany’s grid documentation to competition authorities the companies are active, such as pay TV. classification is used by health insurers to
alerts and cannot always cope with the expansion in Brussels to get approval for their mega The Commission also granted approval for reimburse treatments and as a reference
early morning of intermittent renewable energy, so merger. If the merger is given the green a rival offer for Sky by 21st Century Fox on for doctors. The changes are expected to
newsletters.To transmission system operators have had light, then the combined company will April 7. be adopted at the World Health Assembly
learn more, email to resort to costly redispatch and feed-in work on the metro trains together. in May 2019 and take effect in 2022.
pro@politico.eu measures to stabilize the system.
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TURKEY’S PRESIDENT
LOOMS LARGE
Leader’s images crowd out competiton
BY ELIO GERMANI
IN TURKEY
T
he face of Turkey’s strong-
man president, Recep Tayyip
Erdoğan, with its reassuring ex-
pression of a resolved family man, is
everywhere: larger-than-life portraits
in public squares, nonstop TV cov-
erage, even souvenir rugs for sale at
city markets. His political campaign
has infiltrated cultural and religious
celebrations across the country ahead
of snap elections on June 24, embrac-
ing the iconography of a man leading
his “fatherland” with a firm hand.
The president’s oppressive omnipres-
ence leaves little room for competing
candidates. But will propaganda be
enough to hand him another term as
Turkey’s undisputed leader?
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POLITICO 25
Main image: A
rug shop in the
old bazaar of
Kayseri featuring
portraits of
ancient Ottoman
sultans and
modern political
leaders. And
clockwise, from
right: Custom
rugs at a stand
in Amasya;
an Erdoğan
backdrop in
Konya’s main
square; and
Erdoğan’s face
appears on
a banner in
Amasya.
Left: Erdoğan
looks down
from a banner in
Kayseri.
Below: A portrait
of Erdoğan
hangs outside
the local AKP
headquarters in
Bursa.
Near left: A
vendor sells
sweet corn
underneath
posters of
Erdoğan
and former
President
Mustafa Kemal
Atatürk in
Istanbul.
Far left: A
woman walks
past a campaign
portrait
supporting
Erdoğan’s
candidacy.
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FORUM
26 POLITICO JUNE 21, 2018
land’s North Shore Hospital recent- staff has been scheduling a lot of
ly, I decided to go and find out. appointments at hospitals lately,
Can Jacinda Ardern always making sure she tours the
reinvent social NORTH SHORE HOSPITAL IS LO- obstetrics ward. This was all light-
democracy in CATED in the northern suburbs of hearted banter, not a lot of sub-
Auckland, an affluent area that has stance. But it did show that Ardern
the South Pacific? some of the city’s best beaches and knows how to connect with peo-
most conservative voters. It’s also ple. She’s an experienced speaker.
got a community of Pacific people And yet her delivery comes across
who tend to side with Labour. And as fresh and authentic, not tainted
BY KONSTANTIN RICHTER
IN AUCKLAND, NEW ZEALAND so, representatives of the Pacific by routine. Later when making the
community gathered on one side rounds, Ardern was introduced to
W
hen the leaders of left-leaning par- of the auditorium, Maori leaders a heart-attack patient, an elderly
ties are looking for good news these on the other; hospital staff and woman who was visibly disconcert-
days, they have to turn to a small is- journalists sat in between. The stu- ed by the presence of a dozen jour-
land nation so remote that it’s often dents of a local boys school were nalists. No need to feel intimidated,
omitted from world maps. Jacinda warming up for their performance Ardern said warmly, and pointed
Ardern took over as prime minister of the Haka, the famous Maori war at the people with the cameras and
of New Zealand late last year, just dance. The audience fell to a hush the microphones: “It’s just me and
before a hot and dry summer set in. when told that Ardern was two a few friends of mine.” The patient
Many people thought she wouldn’t minutes away. An elderly Maori laughed.
last long. They said she lacked ex- that lobbies the world’s cartogra- woman stepped forward and broke Ardern and New Zealand are still
perience. Besides, Ardern’s coali- phers to literally put the country into song, launching a powhiri, the in their honeymoon period, I was
tion government seemed somewhat back on the map. welcoming ceremony that initi- told repeatedly in recent months,
shaky, bringing together her own The real reason why Ardern ates many official functions in New the insinuation being that it must
Labour Party, the populists of New seems more important geopoliti- Zealand. end sometime soon. But it hasn’t
Zealand First and, in a supporting cally than her status as leader of Ardern appeared, walking down yet. Ardern’s ascent came quickly
role, the left-wing Greens. New Zealand would suggest is that the steps and sitting down on the indeed last summer when a man
That hot New Zealand sum- she makes for an excellent anti- stage. She was wearing a pastel- inauspiciously named Andrew Lit-
mer has long gone but Ardern is Trump. Ardern is, at 37, compara- colored dress (a subtly stylish piece tle stepped down as Labour leader
still there. Her popularity remains tively young, extremely agreeable of maternity fashion) and ankle and asked her to fill in. Much like
In the main pretty much undiminished. She and — as the U.S. fashion magazine boots. This was Ardern’s first pub- Germany’s Martin Schulz, Ard-
photo above, has kept the coalition together and Vogue recently put it — “unabash- lic event after the release of the ern miraculously rose in polls.
students from avoided the kind of major blun- edly liberal.” During her campaign, new government’s budget. The But while the Schulz-Effekt proved
an Auckland ders her opponents had predicted. Ardern promised nothing less than journalists were hoping that she short-lived, Jacindamania didn’t.
boys school She has also raised her country’s a transformational government would talk about the numbers, a Schulz floundered in elections,
perform the profile abroad — and that’s not just that would tackle climate change, key indicator of where her govern- Ardern flourished, and now it’s Ar-
Haka, a Maori because she announced that she’s social inequality and other ills al- ment is headed politically. When dern who gets to travel to Berlin —
war dance, to pregnant and would go on mater- legedly caused by the free-market Ardern finally stood up to speak as she did in April — and to lecture
mark Prime nity leave — the first world leader economy. So what has she been up — following more song, speeches SPD leaders on the future of social
Minister Jacinda to ever do so. (The baby is due any- to since? Can frustrated leftists in and, of course, war dancing — she democracy.
Ardern’s arrival time now.) Or because she wore Europe and elsewhere take their commented on how people would And why not? Ardern has
at North Shore a cool Maori cloak when she met cues from her? Is social democra- inevitably liken the budget to her worked on Labour campaigns since
Hospital. the queen in Buckingham Palace. cy going to be reinvented in, of all pregnancy because they both took she was a teenager. She met com-
Or indeed because she featured in places, the South Pacific? When Ar- up a lot of her time. rades all over the globe when trav-
HANNAH PETERS/
GETTY IMAGES a New Zealand Tourism campaign dern was scheduled to visit Auck- She also joked about how her eling as president of the Interna-
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POLITICO 27
At Buckingham
Palace, the
prime minister
wore a Māori
cloak adorned
with feathers
and bestowed
on chiefs and
dignitaries
to convey
prestige, respect
and power,
according to
an expert at
the national
museum of New
Zealand.
THE EUROZONE
ISN’T READY
FOR THE NEXT
BIG SHOCK
MIGUEL
OTERO-
IGLESIAS Here’s how to fix that
is senior analyst
at Elcano Royal
Institute and MADRID
T
professor at he return to economic
the IE School growth in the eurozone
of International has produced a danger-
Relations. ous sense of complacency on the
Old Continent, especially in the
richer countries of the north. But
RAYMOND Italy’s flirtation with an exit from
TORRES
the euro under a populist govern-
is director for
ment is a stark reminder that, if left
macroeconomic
unaddressed, the deep structural
and international
weaknesses that plague the single
analysis at
currency could trigger an existen-
FUNCAS. They
tial crisis across the EU. It would
are co-authors of
be a mistake, therefore, to believe
the paper “Quit
we can drive along in business-
kicking the can
as-usual mode, or just take a few
down the road: A
small steps toward more European
Spanish view of
integration.
EMU reforms.”
This week’s Meseberg Decla-
ration signed by Angela Merkel
and Emmanuel Macron, although
positive in its direction, is part of a
collective denial about what needs
to be done. You don’t need to be a
populist to recognize that Europe’s
monetary union is dysfunctional
and in dire need of more substan-
tial reforms that those proposed by
Germany and France. words, risks should be minimized safeguards to avoid irresponsible that stick to fiscal prudence and
To keep the single currency before they are shared among the behavior. commit to structural reforms will
alive, it needs two major structural group. This eurozone budget — which receive support.
improvements. But the experience of Spain and should be closer to €100 billion The question of what happens
First, it needs to reduce the others shows that this approach, than the €10 billion currently fore- when a member country misbe-
fragmentation in Europe’s banking although it may work in normal seen — would smooth macroeco- haves must also be answered. In-
system that has caused the Con- times, tends to produce unneces- nomic shocks and fund pan-Euro- troducing formal sovereign debt
tinent to experience more severe sary economic damage during a pean projects to increase growth restructuring in the eurozone to
crises than other parts of the world crisis. The strategy of placing most potential, ensure sufficient public ensure market discipline ex ante —
— most notably in comparison to of the burden on crisis-stricken investment, reduce inequality, pro- as Merkel has suggested — is prob-
the U.S. countries under the adjustment tect the borders and facilitate debt lematic.
Second, it has to develop a logic of the so-called troika can — in sustainability. As long as the central fiscal ca-
streamlined and legitimate deci- the long run — prove to be politi- It would be an ambitious mea- pacity is not large enough — and
sion-making process to respond cally unsustainable and undermine sure, and it can only happen if it won’t be for some time — sov-
quickly and boldly to the next ma- European citizens’ confidence in there is trust among member coun- ereign debt restructuring will be
jor recession. the euro. We saw it in Greece. We tries and a willingness to pool more both traumatic and destabilizing
The next crisis is likely to hit are now seeing it in Italy. fiscal sovereignty. For it to work, for Europe as a whole. Instead, a
some countries harder than others. Yes, Germany carried out suc- every member country would need member country should be able
For the The problem is that the only tools cessful reforms in the early 2000s. the backing of its citizens. to obtain financial support from
eurozone at the eurozone’s disposal to tackle But their success owes much to the Merkel and Macron neglect the central fiscal authority, while
to be these recessions are internal de- fact that other European coun- this point in their declaration. relinquishing its fiscal sovereignty
successful, valuations — which invariably lead tries were sustaining demand for But the truth is that reform will temporarily, and signing a memo-
we need to to income cuts and job losses. German goods and services. What be politically impossible without randum of understanding of mac-
The European Commission, aca- might be good for one country can first explaining to voters why their roeconomic reforms.
inject more demics and national governments be damaging if several countries government needs to finance a eu- This fiscal authority would have
democratic broadly agree on this diagnosis. act at the same time. rozone-wide fund, when it should to represent the interests of the
legitimacy The problem is that there is no We need to be more ambitious be activated and how it should be eurozone as a whole and not the
into consensus on the way forward. than simply proposing a eurozone deployed. The eurozone is, after sum of the individual members, as
how it is Some argue that eurozone coun- budget. Designing a relatively well- all, a public good. Politicians have a is now the case with the European
tries should take on more responsi- sourced fiscal capacity, managed responsibility to make a convincing Stability Mechanism as well as the
governed. bility when it comes to prevention by a central fiscal authority at the case for why it needs a eurozone future European Monetary Fund
and reform. That means putting European level will be crucial to budget to sustain it. proposed by Merkel and Macron.
IMAGE VIA ISTOCK public finances in order, boosting offset country-specific shocks. They must also address the To ensure this, the permanent
the solvency of banks — by reduc- This can take several forms: a concern — common in northern head of the central fiscal author-
ing the incidence of non-perform- Europe-wide fund to be mobilized member countries — that creat- ity should be put forward by the
ing loans — and reforming their depending on a country’s circum- ing a central fiscal capacity will Eurogroup and ratified by a newly
labor and product markets. stances; an investment fund, or an encourage some to misbehave and established euro committee in the
Action at EU level, according unemployment reinsurance system overspend. European Parliament.
to this view, should only become that tops up national schemes. This can be avoided with the The bottom line is simple. For
an option when each country has What matters is that it can be right incentives. The new frame- the eurozone to be successful, we
taken the necessary measures to quickly activated in the event of work should be set up in a way need to inject more democratic le-
get their house in order. In other a major shock and that there are that ensures that only countries gitimacy into how it is governed.
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POLITICO 29
P
general of the
opulist parties are winning the bandwagon and adopting “pop- might think about taking some pag- and the EU fall under the same
International
elections across Europe. ulism” as a nom de guerre to proud- es from the populist playbook. rubric.
Institute for
Instead of ignoring them, es- ly emphasize they are with and A number of new parties, both Mainstream parties should not
Democracy
tablished parties should be taking of the people. As more and more populist and not, are setting out become populist. But they should
and Electoral
notes. populists gain footholds in national to lower the threshold for internal adopt some of their most success-
Assistance (IDEA).
Today, every fourth European governments, populism is becom- participation. Newcomers in Italy, ful — and productive — traits. Un-
is governed by a populist leader. ing synonymous with “serving the Spain and France have all used a like some of the more radical fea-
SAM VAN Populists have grabbed the reins in people” and giving them credence mix of consultative policymaking, tures on display — xenophobia or
DER STAAK Italy, Greece, Poland, Hungary and as real democratic parties. open primaries and digital tools to virulent nationalism, for example
is the head of Italian Prime Minister Giuseppe facilitate citizen involvement. — these are not in themselves anti-
the Czech Republic. They’re busy
International Conte used his maiden speech to Populist parties have also made democratic or illiberal.
reshaping the political landscape
IDEA’s Europe say he is proud to call his govern- reforming the political system a Austria’s young chancellor, Se-
in countries such as Austria and
program. ment populist if it means “the key part of their agenda, claim- bastian Kurz, and French President
Finland, where they are in govern-
ment with established parties, and ruling class listening to people’s ing to want to reduce the power Emmanuel Macron have shown
in Germany and the Netherlands, needs.” Both Orbán and Trump’s of parties, cut down the size of that established parties and mod-
where they make up the largest op- former strategist Steve Bannon parliaments and curtail lobbyism. erate movements can incorporate
position force. have used the “populist” label to Controversially, the Polish and certain populist strategies and win
But first, what exactly is a popu- boost their image as “protectors of Hungarian governments have intro- elections. The parties that embrace
list? So far, there hasn’t really been the people.” And last year, Dutch duced reforms to reduce the power populism’s better ideas will be the
a single, agreed-upon definition. Prime Minister Mark Rutte — as es- of elites while tightening their grip ones that survive to shape the po-
Pundits have defined it variously tablishment as they get — claimed on power. Many populists promote litical future.
as nativism (Viktor Orbán in Hun- victory over “the wrong type of direct democracy, such as refer-
gary), majoritarianism ( Jarosław populism,” suggesting there is a enda and citizen’s initiatives. It’s
Kaczyński in Poland), anti-elitism “good” type too. telling that the European Parlia-
(Beppe Grillo in Italy), econom- What unites Europe’s populist ment group that unites Italy’s 5Star
ic surrealism (Alexis Tsipras in movements is their refusal to play Movement, the anti-immigrant
Greece), and of course good old by the rules of conventional poli- Alternative for Germany, the far-
Polish Prime
demagoguery (Donald Trump). tics. This is more a matter of style right Sweden Democrats and Euro-
Austria’s young chancellor,
Minister
Nor do populists necessar- than anything else — they are es- skeptic UKIP calls itself “Europe of Sebastian Kurz, and French
Mateusz
ily agree on policy. Some are sentially disruptive parties and like Freedom and Direct Democracy.” President Emmanuel
Morawiecki,
left, and his
anti-austerity leftists, others are to put on a good show — but the Populists have also championed Macron have shown that
Hungarian
anti-immigration right-wingers. idea clearly appeals to a growing policies that give citizens a tangible established parties and
Take Kaczyński and the Dutch number of voters and could lead to sense of the state working in their
counterpart
firebrand Geert Wilders. Both are concrete changes in our political favor. These include family ben-
moderate movements can
Viktor Orban.
populist politicians who oppose system of representation. efits in Poland and Hungary and incorporate certain populist
JACEK TURCZYK/EPA immigration and rail against the That provides an opening for tax simplification in Italy. These strategies and win elections.
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IRELAND
CONTINUED FROM PAGE 5
NEWS POLITICO 31
Political wheeling and dealing is in high gear as the EU begins the most
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