The first problem of Draghi report is your need. The second is its existence. The third and fourth are the contradictions and wars it will generate.
The report is recognition that the European Union, which has talked about competitiveness, employment and innovation for decades, continues to constantly lag behind the United States and China. In March 2000, during one of the Portuguese presidencies of the European Union, the Lisbon Agenda was approved. The ambition was brave (from Wikipedia): “The Lisbon European Council (…) set the strategic objective of converting the European Union economy “into the most competitive and dynamic knowledge economy in the world, before 2010, capable of economic growth lasting accompanied by a quantitative and qualitative improvement in employment and greater social cohesion». After 24 years, if we weren’t the victims of the inconsequential strategy, it would be funny. So, it doesn’t. At least second Mario Draghi, who considers that if what is in his report is not put into practice, Europe will enter “slow agony”.
The first problem with the Report is, therefore, that it is not even necessary. And it will be necessary because previous reports, strategies and plans have not been successful. The second problem is that the report exists. That is, the mere idea that the competitiveness of the European Union is something that an expert, listening to a few dozen interested or knowledgeable parties, but clearly not all – it seems Central and Eastern Europe was not listened to – after several months of study, meeting, consideration and production you can Designing a path for the future of the European Union in this way is a recognition that normal political processes, elections, institutions, are not capable of doing so. And, in addition, it presents the competitiveness of an economy as something that is designed from the political center. An all-or-nothing statist and dirigiste visionlet’s face it. But let us accept the necessity and usefulness of the exercise. And then? Then the other problems begin. They’ve already started.
A few days after the Report was presented, twenty member states of the European Unionincluding Portugal and Germany, but where France, Italy or Spain are not present (which is revealing) produced a non-paper, a very European thing, where they signal that the conclusion of the Draghi and Read (this presented in April) must imply the strengthening of the internal market, not the other way around. This is important because, even without saying it expressly, the discussion these States are entering into is one that will be one of the most important in Brussels in the coming years. Namely: For European companies to be competitive, is it necessary to facilitate the creation of “European champions” in certain sectors and industries, even if this implies less competition in the internal market? And, breaking competition rules, can we allow this to be done with national public money? If so, Those with larger budgets and potentially more international companies have an advantage and the right to be supported. And perhaps it will be with European money, because the option of state aid to stimulate cross-border investments is defended by Draghi and this could be a way of financing these projects with money from Europe. And, without much difficulty, most projects like this will involve larger countries, not smaller and more peripheral ones. And that’s why Germany also signed the document. Because part of the German government does not like public subsidies, and almost everyone does not want European subsidies for companies from other member states.
But the problem is not just money. AND the protection of national industries. Something very anti-European, except in some States. A recent example. The possibility of a large Italian bank, UniCredit, buying a significant part of a large German bank, Commerzbank, created serious official anger in Berlin, responded by the government in Rome and led to the president of the European Central Bank, Christine Lagarde, saying trans-European banking consolidations are good, even if the Germans are the ones being bought out. Lagarde didn’t say exactly this, but this is what she meant.
Another example. Shortly after the Draghi report was published, the Luxembourg finance minister criticized some of the measures suggested by the former ECB presidentnamely those that have to do with… the banking and financial system, of course. A sensitive topic in the Grand Duchy. Gilles Roth, the minister, anticipated that Luxembourg does not like the idea of centralized supervision of European capital markets by the European Securities and Markets Authority and the creation of a separate jurisdiction for European banks with significant cross-border activities, as Draghi suggested and which should be part of Maria Luís Albuquerque’s mandate.
I.e, What Draghi proposes is not completely new, it is not necessarily good and it will not happen just because it is in the Report, if member states do not want it. Nothing new, therefore.
