• Germany's news in English
 
app_header_v3

Gabriel's 'very French idea' unlikely to fly

Tom Barfield · 4 Jun 2015, 17:46

Published: 04 Jun 2015 17:46 GMT+02:00

In an op-ed article published in several European newspapers, Vice-Chancellor and Economy Minister Sigmar Gabriel and his French counterpart Emmanuel Macron put forth a social-democratic wishlist for European reform.

The pair proposed warding off political division and economic instability in the eurozone by harmonizing wages, regulations and tax codes across countries using the single currency and giving the zone more of a common voice in European politics.

Further, the two ministers called for a common eurozone budget – long rejected by Germany – that could be used to lend money to struggling countries so as to avoid a repeat of the 'austerity trap' that has swallowed Greece.

"The first thing I thought was that it's a very French idea – more central planning, fewer rules, more political discretion," Professor Michael Wohlgemuth of think-tank Open Europe Berlin told The Local on Thursday.

"The solutions they suggest don't have anything to do with strengthening our economies. Leveling the playing field always sounds good, but what they really have is a very French idea of raising rivals' costs."

If the plans were implemented, he argues, they would do more to hold France's competitors within the eurozone back and allow the "uncompetitive" French social model to struggle onwards.

East and Germany reluctant

Such goals are unlikely to find majority support among eurozone countries, Wohlgemuth said, especially in the newer eastern members.

"The East wouldn't like to have harmonized corporate taxes, because that's where they can really compete with the western eurozone welfare states," he pointed out.

Meanwhile, the conservative-dominated German government remains reluctant to accept "mutualization of taxpayers' money" through a common eurozone budget.

"It's doubtful if some committees in Brussels could make better decisions than national governments" on where to spend the money, Wohlgemuth added.

No big impact

In fact, he suggests, the plans are more likely to be "addressing the social democrats in the ministers' home constituencies, saying 'we have some good ideas and the German-French tandem is still working" - in part as a reaction to the drive for reform coming out of the UK under Prime Minister David Cameron.

Story continues below…

"I don't think it will have a big impact in terms of national policy agendas – it's a contribution to the debate that will shape Europe, but nothing more imminent," Wohlgemuth concluded.

Wohlgemuth's criticisms of the plan were counterpointed by French star economist Thomas Piketty, who told The Local in France that the plans didn't go far enough to fix the eurozone.

"A popular majority in the eurozone should be able to choose the policy they want," Piketty said.

But that would require overturning some of the existing keystones of economic governance in the eurozone, including strict budgetary requirements and a requirement for unanimity on fiscal decision-making, Piketty added.

For more news from Germany, join us on Facebook and Twitter.

Tom Barfield (tom.barfield@thelocal.com)

Your comments about this article

Today's headlines
Germany sees 'turning point' in birth rate decline
Children at a a kindergarten in Swabia. Photo: Nikolaus Lenau/Flickr

Is Germany's three-decade decline in birth rate now over?

Trump protesters rebuild and tear down 'Berlin Wall'
The 'Stop Trump' protest at the Brandenburg Gate. Photo: DPA.

US expats gathered at the Berlin's iconic Brandenburg Gate on Friday "rebuild" the Berlin Wall and protest US presidential candidate Donald Trump's own proposed wall-building.

Accusation of sexism within Merkel's party creates uproar
Defence Minister Ursula von der Leyen and Chancellor Angela Merkel, two leading women in the CDU party. Photo: DPA.

A young politician from the ranks of Angela Merkel's Christian Democratic Union (CDU) has caused a storm by suggesting that the party is institutionally sexist.

EasyJet 'in talks to buy German airline' to duck Brexit
Photo: DPA

EasyJet is in talks to acquire TUIfly, a board member of the German carrier said Friday, as the British no-frills airline looks for ways to keep flying freely within the EU after Britain quits the bloc.

Symbols of migrant plight to go on show in Bonn museum
Photo: DPA

A people smugglers' car, a dinghy and a life jacket are among items related to Europe's migration crisis due to go on display at a German museum.

Brexit
Green party demand 'quick and easy' citizenship for Brits
Photo: DPA

The Green party has called for Brits living in Germany to be offered a painless path to obtaining dual citizenship as to "reassure them over the future".

Berlin the new London? 10m2 flat to rent for €750 a month
Photo: Immonet.de.

This shoebox apartment in the gentrified Bergmann-Kiez neighbourhood may be a sign that the tides are turning for Berlin’s comparatively cheap housing market.

Far-right AfD reach record high in national poll
AfD leader Frauke Petry. Photo: DPA.

The Alternative for Germany (AfD) was backed by 16 percent of respondents in a new poll, which was a new high for the upstart populist party.

Bautzen youth beat up pensioner in racist attack
Photo: DPA

In the Saxon town of Bautzen, which has become a byword for racism and anti-migrant sentiment, two youths have attacked a 72-year-old man, shouting 'foreigners out'.

German lawmakers ratify landmark Paris climate accord
The German parliament (Bundestag). Photo: DPA.

Germany's lower of house of parliament on Thursday ratified the Paris agreement on climate change, following in the footsteps of 60 other countries that have committed to the landmark agreement designed to stem the planet's rising temperatures.

Sponsored Article
The Inner Circle: the secret to dating in Berlin
Lifestyle
6 things about Munich that’ll stay with you forever
Sponsored Article
Why Jordan is the ‘Different’ East
Lifestyle
10 pieces of German slang you'll never learn in class
National
Seven great reasons to stay in Germany this September
National
Ouch! Naked swimmer hospitalized after angler hooks his penis
Sponsored Article
Retiring abroad: ensuring your health is covered
National
Six reasons why Berlin is now known as 'the failed city'
National
15 tell-tale signs you’ll never quite master German
Culture
7 American habits that make Germans very, very uncomfortable
Rhineland
Story of a fugitive cow who outwitted police for weeks before capture
Sponsored Article
Life in Jordan: 'Undiscovered treasure'
Culture
Eleven famous Germans with surnames that'll make your sides split
Lifestyle
The best ways to get a visa as an American in Germany
Sponsored Article
The Inner Circle: the secret to dating in Berlin
Gallery
Germany's 17 Olympic gold medals in pictures
14 facts you never knew about the Brandenburg Gate
Society
Ten times Germans proved they really, really love beer
National
Six things you need to know when moving to Germany
Travel
These 10 little-known German towns are a must see
International
German scientists prove birds can sleep while flying
Technology
London v. Berlin: Which is better for startups?
Lifestyle
13 mortifying mistakes German learners always make
Travel
Enter if you dare: Berlin's best abandoned haunts
Lifestyle
10 rookie errors all Brits make when they arrive in Germany
5,682
jobs available
Toytown Germany
Germany's English-speaking crowd