EU Leaders With “No” Vote Headache, Take On Economic Woes

• June 19th, 2008
• Posted by 7thmin

The din of heavy tractors and semi-trailers blocking the streets of Brussels – farmers and truckies protesting over petroleum, and prices – has set the scene for a tense meeting of European Union heads of government this week (19-20.6.08).

Their talks about reworking and expanding the EU will be more difficult than planned, thanks to voters in Ireland turning down the plan at their referendum, hardly one week ago.

Possibly more demanding for the political heads will be the economic realties beginning to bite very hard.

Lee Duffield writes from Brussels.

RECRIMINATION?

Recrimination has been the theme of briefing and leaks coming out of gatherings of officials and political leaders in the lead-up to this summit.

Members of the executive Commission are reportedly angry at the Irish government, as they see it, letting approval of the new EU reform treaty slip through their fingers.

The Irish nation has profited mightily from its affiliation with the EU; per capita Gross Domestic Product today is among the top five of the group of 27 countries.

So how could they bite the hand so hard, and so, (to keep to the canine theme for a moment), set the Irish tail wagging the much larger European dog?

Word from Ireland has been that several voters did not fathom the complicated decision they were being confronted with, and being in doubt, acted on their right to say no.

They were also reportedly, amid some domestic discontent, looking for a chance to send a rude message to their national government, which along with the main opposition groups, were going for “yes”.

The country’s strong farm lobby had been harbouring reservations about Europe going further along the path of trade liberalisation with the World Trade Organisation (WTO), meaning less protected markets, e.g. for beef producers.

There were those lurid stories also around the margins: reform of the EU system would mean conscription into the armed forces, (it was being said in certain pubs); teams of Continental doctors would be over to conduct forced abortions, (it was suggested here and there).

The Irish Prime Minister, Brian Cowen, is accused here of assuming that the Irish default position, support for the EU, would hold, and made a mistake when he opted for a short and low-key referendum campaign.

He will be asked for suggestions about how his government might adjust things, so that the new EU treaty – the “Reform Treaty” so-called – can go ahead in some form.

NO PLANS?

There may be no suggestions at all, just for now, from that quarter.

After a meeting of EU Foreign Ministers at Luxembourg (16.6.08), Mr Cowen’s Minister told journalists, just that their government was asking for some “time and space”.

It is a reality that the Irish population is one-percent of the whole of the EU, where the trend in decision-making, over the decade, has been moving away from national vetoes of decisions of the group.

TREATY PROPOSALS

To date eighteen of the member countries have gone through with ratification of the treaty designed to readjust, and simplify group decision-making, to accommodate the expansion of the Union since 2004; the last being the United Kingdom, seeing it through the final stages of Parliament on the eve of the Brussels Council, (18.6.08). All have approved it.
An earlier plan for a “constitution”, which this treaty replaced, was dropped after rejection at national referendums called that time, in the Netherlands and France.

The French government, itself moving into the influential Presidency of EU summitry for the coming six months, has declared the treaty plan will need to continue in a negotiated form.

The President of the European Parliament, Hans-Gert Pottering, told Le Monde (17.6.08) the “Irish ‘no’ cannot be the last word”.

Members of the Parliament staged a scene-setting debate on Wednesday, at Brussels, with leaders of the European Commission and Council, on oil.

Commission representatives said special assistance in the face of rising energy prices could only be afforded to “most vulnerable groups” in society — not the protesters of the day.

Andris Piebalgs, Energy Commissioner, said: “Our dependency on imported oil is high and costs are increasingly steadily. There is a direct negative impact on citizens and businesses.”

The EC President, Jose Manuel Barroso, likewise declaimed against that vote: “The treaty is still alive”, he said.

Whatever answers the big guns, read major countries, may get out of the consultations this week, the program for change has taken a blow, and new opponents may now emerge in force — for example the government of the Czech Republic has seized on developments to re-state long-standing doubts.

PRESSURE FROM THE ECONOMY — AND MEN IN TRUCKS

Jose Manuel Barroso meanwhile has turned attention to pressing, and increasingly difficult trends the global economy.

In Brussels today (18.6.08) a 55 litre fill-up for diesel (and diesel until lately has been the cheap and green, increasingly popular fill-up of choice in Europe), cost €75 (A$123.07; dcerates.com, 18.6.08).
The thousand-odd truckies and tractor-borne farmers well knew it, converging on EU headquarters building to beat at the barbed-wire barricades and demand relief from their own spiralling cost problems.

These shock-troops of public reaction to unwelcome trends in the economy came mainly from Belgium, the Netherlands and France; they were carrying on the wave of protests of the last month, by groups ranging through the fishing industry, taxis and farmers, especially in Spain and Portugal, and France.

The EU has been beating a long retreat from the farm subsidies and production quotas being called for by the protestors, (see EUAustralia, 1.6.08).

Mr Barroso declared that likewise, member governments, which have responsibility for energy pricing, should not provide subsidies for higher costs that appeared definitely “here to stay”.

WEATHERING THE STORM
Heads of government asked in that way to weather the storm, being themselves elected politicians, will need to think hard, and will not have that long a time to do it.

Oil prices are the key goad to action.

On Tuesday oil was set at $US135.18 a barrel (A$143.06); it had reached a new record of $US139.89 (A$148.05) the day before.

Step One of the EU leaders is the debate about to get under way, when they come together here as the European Council.

Reference:

Thomas Ferenczi, “Hans-Gert Pottering …”, Le Monde, Paris, 17.6.08, p 8.

Sally Lyall and Stephen Castle, “Ireland rejects treaty, dealing setback to EU”, IHT, Paris, 14-15.6.08, p 1.

“Truckers and farmers block roads into Brussels …” (AP), IHT, 18.6.08. www.iht.com, (18.6.08).

Picture: Tractors besiege the Cinquantenaire monument in the European Union district of Brussels.

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