European Union

2015 promises to be a year of change. With elections fast approaching in Finland, the United Kingdom, Portugal, Spain, Poland and Ireland voters seem to want to reject the status quo. While everyone is talking about the Greek debt negotiations and the rise of Podemos in Spain, in the North of Europe, an important election has skipped many people’s radar.

Finland, Europe’s tough fiscal hawk, is likely to face a change of government after Sunday’s election. The change is likely to come about due to a slowing Finnish economy and what Prime Minister Alexander Stubb called a “lost decade” with recession entering into its third consecutive year, unemployment growing and competitiveness declining. Thus similar to other struggling economies in Europe, Finland is experiencing economic hardships which in the eyes of nearly all parties can only be resolved through harsh labour market reforms and fiscal austerity. In contrast, however, to the trend in the South where such policies led to public discontent and a steep increase in popular support for anti-EU parties, Finland is experiencing a revival of the established parties, while the Finnish anti-EU party, the Finns, however, is falling behind their landslide successes from the previous election in 2011.

Will they vote for anti-establishment?

Watch out – The Finns are coming…

Despite the decline in popularity of his anti-establishment party, Timo Soini, the Finn´s leader, might well end up on top as the winner of the Finnish election-dilemma as part of a coalition in a government led by the Central Party. To be more specific, in the event of an “equal” split of votes between the four largest parties (all four are polled to receive around 15%-25% of the votes), a coalition of three will need to be formed. While, the current governing parties have already turned down the idea of working together again, that would leave the Finns as the most likely alternative to become the third partner in a Central Party-led government.

Mr Juha Sipilä, the Central Party’s leader and likely to become Finland’s new Prime Minister currently leading with 24.9% of the votes, is not opposed to the idea so long as its partners agree with his political agenda. Not to mention that the current Prime Minister Alexander Stubb has reiterated that the Finns are much better than the reputation preceding them abroad, showing that he would also be open to support them as a coalition partner. As a result, anti-EU forces might find themselves in the Finnish government, despite the fact that voters are rallying around the established parties and support for reactionary parties is fading.

The Finn’s leader Timo Soini

… to Europe!

A coalition including the Central Party and the Finns is expected to be less pro-European as the current government. Mr Sipilä, though successful in business, is not renowned for his international experience and although his party might consider itself pro-European difficult compromises will need to be made with the Finns, who are opposing new bailout programmes, the Euro and further deepening of European relations.

In Brussels the event of a coalition between the Central Party, the conservative National Coalition Party and the Finns will mainly impact Finland’s position and negotiation leeway in the Council. Mr Sipilä’s hands in negotiations will be more tied than Mr Stubb’s or Mr Katainen’s have been. On the one hand he would have to demonstrate his support for a deeper EU to its European partners – to whom Finland will grow more and more economically dependent the longer sanctions against Russia prevail. On the other, he would have to reassure his coalition partner Finland is maintaining high levels of sovereignty and remaining critical towards the Eurozone.  In particular on the latter, however, Mr Sipilä demonstrate strength by continuing to back strict rules and austerity measures – policies that all Finnish parties support both for their own country and for Europe. Finland is therefore expected to remain “Europe’s fiscal hawk”. Moreover more than before Finland will be likely to defend EU disintegration positions and align itself to the UK defending sovereign interest and the principle of subsidiarity.

Anglo-Finnish cooperation is already well established in the European Parliament, where the Finns have joined the British-led European Conservatives and Reformists Group demonstrating a conservative yet mainstream political agenda. As the elections are likely to make Prime Minister Stubb’s party a junior coalition partner, we neither expect that the outcome will neither affect the focus of the National Coalition as part of the EPP nor workings of the Finnish Vice-President of the Commission Jyrki Katainen nor drastically change the focus of his political agenda in Europe.

All in all, the Finnish elections may not change the tone in Brussels tremendously on their own, but they will provide insights on how anti-establishment parties are likely to affect national politics and therefore affect London’s, Copenhagen’s, Berlin’s and Madrid’s positioning in Brussels.

Is Europe Finnish(ed)?

The Finnish “case study” is helpful in understanding and dealing with the fast growing support for anti-establishment movements across the Continent. In the North, Sweden, Denmark and Norway are watching closely as growing support for their respective populist parties is making it harder for their mainstream parties to continue ignoring them. While Norway is currently being led by a coalition of conservatives and the populist Progress party, the Sweden Democrats came third in the September 2014 elections in Sweden and Denmark’s Danish People’s Party is gaining influence and support before the upcoming elections in autumn.

In the Centre of Europe, the Finns’ positioning and agenda seem familiar to a still domestically unwelcome anti-Euro party in Germany, the Alternative für Deutschland (AfD). Bernd Lucke, the party’s leader, will eye developments in the North closely to assess whether the Finnish outcome might be a valuable example on how he could achieve his power aspirations in Germany.

In the South, Spain is also experiencing a similar trend with new anti-establishment parties, even though its popularity appears to be fading the closer we get to parliamentary elections in December. Podemos could grasp a large part of the votes, leaving no party with a majority to form a government.

Although anti-establishment parties are experiencing a slow in their popularity across Europe, all eyes will remain on them.  The success of Podemos, Syriza, the Finns, the UK Independence Party and others will furthermore force the establishment to make concessions and re-orientate their position on a great variety of issues such as European integration, social, economic and fiscal policies.

While the traditional separation of power between centre-right and centre-left parties will continue to dominate Europe, anti-establishment parties are likely to make this election year way more thrilling and unpredictable than previous ones. Let’s see what happens!

Announcement:

We will keep you up-to-date with all our coverage of this election year with upcoming analysis of the UK and the consequences of a possible Brexit as well as following the election developments in Denmark, Portugal, Poland and Spain.

 

Martin Bresson, Joachim Wilcke, Ilektra Tsakalidou

Earlier this week, we reported that rather than the 12 new judges initially requested by the European Court of Justice to help with its burgeoning workload, EU member states are about to approve 28 instead thanks to a classic fudge that has more to do with national pride than legal efficiency. As is our practice at Brussels Blog, we thought we’d offer up some more details on how this deal came about, including some of the correspondence between the court and those responsible for making the decision.

The choice to double the size of the ECJ’s general court – the second-highest in the EU – was made only because, for years, national governments couldn’t decide where the 12 new judges would come from. So they decided to name one new jurist from each of the EU’s 28 members instead.

The issue had been deadlocked for three years, but during Greece’s turn at the EU’s rotating presidency last year, Theodoros Sotiropoulis, the courtly Greek ambassador to the EU at the time, dropped an unsubtle hint to the ECJ: you’ll get 28 judges, or you’ll get none. Here’s a copy of that letter (the handwritten Greek at the beginning and end of the letter is due to the fact the ECJ president, Vassilios Skouris, is also Greek):

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Disclaimer : The interpretation of debates serves to facilitate communication and does not constitute an authentic record of proceedings. Only the original speech or the revised written translation is authentic.
Source : © European Union, 2015 - EP

Source : © European Union, 2015 - EP

Since 2010, the European responses to the global financial and economic crises have been dominated by a narrative of austerity. European governments have sought to bolster confidence in their economies by rolling back public spending. Austerity may pose an existential crisis for the European Union (EU), both regarding austerity-hit states being forced to leave the single currency (think Greece), and the EU’s willingness to be a global leader on key issues outside economic growth (think climate change). The extent to which austerity is necessarily a barrier to climate ambition is a crucial component of our research, funded by the Leverhulme Trust. The 2015 United Nations Framework Convention on Climate Change (UNFCCC) summit in the French capital, Paris, has been identified as a crucial opportunity to foster ambitious climate goals. Will the EU be a leader during the negotiations, or fade into the background?

The Barroso Commissions

While US leadership in environmental policy declined during the 1990s, the EU moved to position itself as a global pioneer of climate policy, particularly following the Kyoto Protocol negotiations in 1997.[1] International climate policy provided the EU with a niche into which it could forge its global identity. The European Commission is the ‘commissioner’, or source, of all EU legislation. Under the guidance of José Manuel Barroso (2004-2014), the win-win objective of ‘green growth’ dominated Commission thinking around climate change. Here, the Porter hypothesis[2] underlined the belief that by stimulating innovation, environmental policy can be economically beneficial. The EU Climate and Energy Package, with its ‘20-20-20’ targets, was a notable centrepiece. In 2008, Barroso claimed confidently that the 20-20-20 targets were the most ambitious in the world; indeed, compared against other developed states, the EU’s targets remain world-leading. Moreover, the separation of the Commission’s Environment and Climate Change briefs in 2010 enabled Janez Potočnik and Connie Hedegaard, respectively, to push their remits onto the global political agenda. Thus, under Barroso, climate change leadership was a key signifier of the EU’s global identity.

The Juncker Commission

However, since the financial crisis of 2008, newer European states (such as Poland) have played an active role in blocking new proposals, while previously ambitious states (such as Germany) have shied away from leadership. (Moreover, officials within the Commission have also been known to block new legislation.) The narrative of climate change being a ‘win-win’ opportunity appears to have been replaced by a zero-sum framing of economy first, everything else second. Crucial to this new context were the changes of 2014, seeing the formation of both a new European Parliament and a new European Commission. Jean-Claude Juncker touted climate change leadership amongst his key messages during his successful election as the new Commission President during the summer of 2014. However, his pro-austerity leadership as President of the EuroGroup between 2011 and 2014 suggests that he will continue to favour austerity measures. As such, a reduction in ambition regarding climate change may not solely be a reflection of member state preferences, but also an indication of the new Commission expressing its own agency.

The new Commission and Paris 2015

The new structure of the Commission under Juncker appears to give a lower priority to climate change than under Barroso. So how will this reduced ambition manifest itself in the run up to the Paris climate talks? Let’s identify the internal and external impacts. Internally, the EU may formulate fewer and less ambitious climate policies, preferring instead to focus on facilitating economic growth. The Circular Economy bill, for example, was dropped in December 2014, shortly after the new Commission took office. By restricting new climate legislation, the EU may hold a less credible leadership position with which to participate in international negotiations. Moreover, under the auspices of austerity, the EU may reduce spending on its own climate projects, hindering the capacity of the EU to encourage other states to follow its lead. For instance, the EU will not ring fence funds to pay for projects that boost energy efficiency in buildings, instead encouraging the private sector to decide where funding should be allocated. The EU member states have committed, however, to a minimum 40% reduction of emissions by 2030, based on 1990 levels.  Although this 40% target is the overall percentage reduction to be met by the EU rather than an obligation for every state to achieve individually, it provides a relatively ambitious starting point for negotiations with states outside the EU.

Externally, the new structure of the Commission will allow less time for the Commissioner responsible for climate change, Manuel Arias Cañete, to build ambitious coalitions in the run up to the Paris talks. Also responsible for energy policy – a significant portfolio in its own right – Cañete is tasked with responding to fluctuating oil and gas prices, opposition across Europe to the construction of new nuclear reactors and energy security challenges. Overseeing these developments is likely to limit Cañete’s ability to prioritise climate change effectively. Second, with budgets squeezed within EU member states, the EU may feel unable to offer significant funding to developing states for climate change mitigation and adaptation. With the UN’s Green Climate Fund struggling to reach its $100 billion target, having been designed to release funds from developed to developing states for climate mitigation and adaptation, a lack of leadership from developed states could hinder significant policy action. As such, regardless of how much the Commission would wish to prioritise climate change, its hands are likely to be tied by its member states’ unwillingness to spend.

Next steps

2015 is a critical year for climate change mitigation. For the past 15 years, the EU has been at the forefront of climate negotiations. But with a new European Commission and austerity measures being implemented in EU member states, the EU may not assume its traditional leadership position at this year’s international negotiations. Will the EU be willing and able to lead in Paris? If not, which states will press for ambitious targets? And how will the EU define its international reputation going forward, if not through climate change? The answers to these questions will not only shape the future of the EU, but the future of the planet as well.

[1] Kelemen, R. D. (2010). Globalizing European Union environmental policy. Journal of European Public Policy, 17(3), 335-349.

[2] Porter, M. E., & Van der Linde, C. (1995). Toward a new conception of the environment-competitiveness relationship. The Journal of Economic Perspectives, 97-118.

The post An Existential Crisis? The European Union, Austerity and Paris 2015 appeared first on Ideas on Europe.