Monday, 14 November 2016

Turkey and the EU: one step closer... to Tuxit?

Inspired by Trump's victory and Brexit, Turkey's president Tayyip Erdogan proposed to hold a referendum on EU accession in 2017.

The Council of the EU, represented by all the EU countries' foreign affairs Ministers, discussed the situation in Turkey on Monday 14 November.

Istanbul: to EU or not to EU? (c)
This follows the publication of the so-called 'progress report' on Turkey a few days earlier, reporting how Turkey evolves as an country applying to become member of the EU.

It isn't the first time the Turkish president criticised the EU - and it won't be the last time. Seeing the political opportunity amidst increasing Euroscepticism, might just not be working for Turkey.

At the end of 2015, 56% of surveyed Turks thought they would benefit from EU membership, against 30% who don't. It is lower than about a decade earlier (63 - 27), but still not in Erdogan's favour.

Still, the EU isn't going to pace up with the progress reports' phrases like: 'Corruption (...) remains a serious problem', 'high numbers of arrests of journalists', or 'efforts continued at a limited pace'.

The country with the 5th most jailed journalists (before the coup!) will have to work more to respect the rule of law, adopt all EU legislation and normalise relationships with Cyprus. And that's entirely up to Turkey, referendum or not.

Wednesday, 9 November 2016

No story, no votes

Do you know Donald Trump's slogan? Sure you do. Do you know Hillary Clinton's slogan? (silence)... And that's why Trump won. Without a story, no votes to win. Just because Clinton is a woman, that doesn't entitle her to anything.

Sure, Trump bashed the establishment. And 'the establishment', by the voice of Clinton, doesn't know how to bash an outsider, especially a reckless, insulting person that broke every rule an aspiring president shouldn't. But the establishment will be back in just a few sentences.

A story we've already heard in the Brexit campaign. Why bother using rational arguments in an irrational debate? Again, 'the establishment' was defeated. As in the US elections, the polls were wrong: people reply in polls in a socially acceptable way. They feel ashamed they choose the irrational vote. But in the end, no one's asking who they're voting for when they're at the ballot.

But the establishment is back in the Brexit. Judges in the United Kingdom ruled Parliament should vote on the Brexit - strange a Prime Minister is scared of her own Parliament, isn't it supposed to represent the people?

Also, it took the Prime Minister over 3 months to decide when exactly the procedure to leave the EU would start. In the first quarter of 2017. 6 months is an eternity in politics - who knows what will happen by then.

Regarding Trump, he'll have to deal with Congress and his own Republican party to get bills passed. Something Trump has about 0 clue how that has to happen, but that might be an advantage. Trump will have to hold press conferences and meetings - with Latin American leaders as well as females.

Trump will have a whole number of advisors with plenty of 'establishment' experience. Trump will have to deal with administrators from every US administration. In other words, Trump will be confronted with establishment about every day. Difficult not to become part of establishment.

A little Belgian story: a rather anti-establishment political party of whose prime goal is the independence of Flanders, has been in the federal government for years. Not one step closer to independence, but much more part of the establishment. Will the same happen to Trump?

Even if we don't know the answer, we can list his name between Abraham Lincoln, Franklin Roosevelt and George Washington.

Thursday, 2 June 2016

Avoiding taxes: Belgium or EU?

What happens in the European Union, stays in the EU. Quite too often national press ignores what comes from 'Europe', forgetting the measures in 'Brussels' are national news.

A curious case of Belgian press coverage was made by the Socialist party leader Mr Crombez, currently in the opposition. In a TV debate with his Liberal counterpart Ms Rutten, he questioned the liberal-supported government's position in the Council of the EU. Belgian Finance Minister Mr Van Overtveldt helped to delay the start of the so-called anti-tax avoidance directive. The directive aims to curb tax avoidance schemes, mainly used by multinationals. This way, big companies will still be able to continue their schemes a little while longer.
Belgium (right): still some taxes to avoid? © the European Union

While Mr Crombez exaggerated his plea (international press didn't focus on Belgium's leading role), it's a recurring issue. Ministers tend to defend more vigorously unpopular positions in Brussels, knowing the national press wouldn't follow their actions. Either because no one follows EU affairs, or because journalists feel issues are too technical to invest resources in.

On top of the lack of interest (or understanding) of the national press, the case uncovers a larger problem. The Council has, despite a modern website, a transparency issue. It's very difficult to understand which country adopts which position (for example, there's no way to know the Belgian position on the case above). This results in an alienation of EU citizens towards the European Union.

The EU's democratic model rests on many pillars to legitimise its actions: the European Parliament is chosen the citizens, the European Council consists of the EU's elected leaders, the Commission is composed of candidates of elected EU governments and the Council of Ministers of elected governments.

The sooner EU citizens understand their representatives shape EU policies, the better. So in the end, we need more politicians like Mr Crombez to put our governments' positions under scrutiny.

Monday, 30 May 2016

Lectures on the United Kingdom and the European Union

The European Union and the United Kingdom share a special relationship. Sometimes isolationist, sometimes interventionist, the Brits have a very ambiguous stance on the European Union. Recently, the brexit and bremain views opposed each other in the referendum on the EU. Find out more about the relationship in these two lectures.

Monday, 23 May 2016

Referendums: a good idea?

Referendums, like the one in the United Kingdom on 23 June 2016 about EU membership. Some see it as a miracle solution to connect (or reconnect) citizens with politics. By having more to say, they'll be motivated again for the political game. Or so goes the argument.

For the European Union, this may be a strong argument to hold referendums. The EU is sometimes seen as very distant from its citizens. So here's your miracle cure for saving democracy. Or not. In referendums, you get the wrong answers to the wrong questions.

Take the Dutch referendum on the association treaty with Ukraine. As some opinion leaders claimed, most of the Dutch didn't even know where Ukraine is on a world map. Let alone they read the over 300 pages of the document. Why ask the Dutch in a referendum about a trade treaty with a country thousands of miles away?

Referenda: a good idea? ©
A quick look on the comments on a website explaining the treaty shows that many persons didn't bother to inform further. One person commented to vote against as long as the government couldn't explain the treaty. Actually, he/she could have found a clear explanation on the government's website.

So instead of judging the treaty on its merits or its shortcomings, the 61% who voted against didn't vote against the treaty. They voted against the establishment, the EU, the government, or maybe just because they had a bad mood. They also voted against the incapacity of politicians to judge whether there should be a referendum or not.

However, that does not apply to the UK referendum: there's a clear question and clear answers. Still, people might just vote against, just because they don't like the UK's government. Or because they don't like politicians.

Switzerland took another approach: in addition to voting for the Federal Assembly (that's the parliament), about 4 times a year, referenda are held. In these referenda, they receive an explanation of the law, a choice (yes or no) and an advice of the government. This way, citizens inform themselves before voting. There's even a possibility to block new laws by collecting 50 000 signatures, and holding a referendum on the new law. Isn't that a better way?

Friday, 20 May 2016

Brexit: stars back European Union membership

250 actors, musicians and other cultural leaders of the United Kingdom urged the Brits to vote for membership to the European Union in the upcoming referendum. In an open letter published on 20 May 2016, they argue it's better to stay in than out: 'let's not become an outsider shouting from the wings'.

My question is: maybe that's exactly what they want: to be an outsider shouting from the wings?

Visit Hadrian's wall protecting the Roman Empire ©
It's important to understand where the Euroscepticism comes from. Deeply rooted in history, the Brits have always been afraid of one big power on the European mainland. The Roman empire is just one of the examples in the UK's history, resulting in a wall quite high up north to protect the empire from invaders. Some remnants can still be visited.

More recently, Napoleon, Hitler and perhaps Stalin have tried to conquer Europe to install one powerful superstate. The Brits have fought Napoleon and Hitler (Boris Johnson?) and won, through hard times, endless battles and countless casualties. Since than, the UK's foreign policy alternated different views: either divide the states of Europe, or isolate itself from the mainland.

One can easily make the comparison. Today, the Brits are fighting the ever more powerful superstate. They couldn't divide it enough from within (support to Turkey's EU accession is just one of the methods) so now it's time to isolate itself from the EU.

So for the supporters of Britain in the EU, namely Britain Stronger in Europe, I'd argue it's better not to warn their compatriots that they'll be outsiders. That's exactly what they want.

I think it's better to point out the world's challenges: Russia's aggressive stance in Ukraine, Turkey's concentration of power, and all the turmoil in Northern Africa. These arguments may be more convincing.

More information: interesting article from the Guardian and an analysis of the pro-EU Economist.

Tuesday, 17 May 2016

The EU countries' economic health barometers

How do you know if a country of the European Union is doing well economically or not? While economists can debate this issue for hours and hours, there's a quite simple way to find out. Via the so-called 'long-term interest rates' of the European Central Bank.

That's quite a mouthful. The European Central Bank is a bank, in the hands of the government. It mangages the Euro, in just a few words. For example, it can allow Belgium to print some Euro's. The ECB's first goal is to make sure that prices for EU goods like spinach, cell phones and tables don't go up too quickly. And not down, otherwise no one would buy them anymore, expecting the prices to go even more down. Actually, the goal is close to 2 percent increase of the general prices per year. Read more about the ECB here.

As part of their duties, the ECB collects data. It does so for the long-term interest rates of government bonds. Lots of difficult words there. Government bonds are loans the government takes. Some of the bonds anyone can buy. Mostly it's big organisations like pension funds who want to buy these bonds. So they know or at least think their money is safe. In return, they receive the money they loaned plus some interest. And an interest rate, is the rate at which the money was loaned.

Let's illustrate it: Belgium wants to spend 100 Euro for buying some fighter planes. So, they check: who wants to give them a loan? I say: me, of course! I feel like Belgium always pays their debts. I conclude the deal, Belgium gets a 1-year loan and will pay me back 102 Euro in a year. So the bond is from Belgium, the interest rate is 2% and the interest is 2 Euro.

Well, that's a little simple, but it's basically it. Now, long-term interest rates are those for bonds of around 10 years. So those who loan money will wait for about 10 years to see their money back. Of course, they will only give their money to states that don't go bankrupt. And the more they think the country will go bankrupt, the higher the interest rate.

Let's take the fighter planes again: I (and many others) think Belgium won't be able to repay the 100 Euro, for a period of 10 years. If I think that Belgium will go bankrupt in 5 years, I can give them a loan with 25% interest rate. So after 5 years, I get 125 Euro back. That's 25 Euro interest every year, times 5, is 125.

Conclusion: the higher the interest rate, the worse the governments' ability to repay their debts. The ECB collects monthly interest rates. There, you can easily see in the figures in the table who can get cheaply loans, and who doesn't. So it's a way to tell if an EU country is doing well or not. Germany usually has the lowest rates.