With the Recovery Fund, the EU increases the budget, but not democracy


The Recovery Fund shows three problems with how European elites think. The first is that the new fund will increase political, bureaucratic and probably fiscal centralization in the Brussels institutions. The Commission will establish the modalities, rules, standards and sectors in which subsidies and loans will be disbursed. The European Union has chosen to take on a new risk by increasing its power over the Member States and exposing itself more to European citizens. A sign of the lack of confidence that cemented the European pact, since we prefer to centralize power in the bureaucracy underlying the Commission rather than to leave countries free to spend how much money (for example by lowering corporate taxes).

This approach will lead to an increasingly pronounced top management, with policies and funding that will almost certainly favor socio-economic groups that already successfully ride globalization (internationalized companies and professionals), activities that have innovation capacity or are requests at this time (scientific, digital, health, green research) and corporations that already enjoy state protection (the multiplied bureaucracies that will manage the funds). Basically, the impression is that the crisis acts as an accelerator, benefiting those who were already in a good position before the epidemic and definitively overcoming those who had been left behind since the sovereign debt crisis of 2010-2011. The risk of this approach, especially in a country with a weak state like Italy, is an even greater divergence between sectors of society, with a consequent sacrifice of the categories most affected by the lockdown and less protected by the government, such as VAT and precarious private workers. If things go like this, Italy will become an even more divided country between an industrial and bureaucratic oligarchy, which in part by capacity and in part by clientelism manages to survive, and impoverished middle classes narcotized by assistance and increasingly incapable of participate with productivity in the national economy. In other words, without a profound reform of welfare and bureaucracy, the European intervention and the greater public expenditure of the State risk benefiting a few without relaunching the development of the country.

A picture that reverberates on the European level, where there is a continuity by the elites in pushing social transformations that risk forgetting how much the most excluded and unsatisfied portions of the electorate are capable of influencing politics and producing radical drifts. Just think of how many consensus the national-populist parties have stolen from the centrist ones in recent years.

The third problem is a political one. The Member States continue with the economic-functional integration, without progress in terms of democracy and political control of the Brussels rulers. Europe will increase its budgets, its constraints, issue debt securities, perhaps collect new taxes without political reform. That is, we continue to do the exact opposite of what we should. The United States of America, which has been viewed with exaggerated optimism in the past as a model for the Union, was born from a political pact between former colonies and the ratification of a Constitution (and passing first through a Confederation). Only once the federal political architecture, based on the separation of powers, was approved, did we proceed with common debt and taxation. Europe, on the other hand, continues to grow without a Constitution, with the intergovernmental method and with technocracy. The liberal principle of no taxation without representation it is less and less respected as the Union takes on additional functions, while there has never been a complete separation of powers in Brussels.

With the risk that if the recovery of the recovery fund does not have great success, the legitimacy of the European institutions will become even weaker than before the pandemic. The more the Union is strengthened and divided into multiple funds and programs, the more difficult it becomes to reform it. Without a real Parliament, without a European political system and without a clearer definition of competences, any step forward in integration risks further emptying the power of the nation states, but without increasing the power of citizens to control who in Brussels will decide on common rules and taxes. Continuing to turn our heads to the other side about these problems, as the European elite have been doing for years, will only increase both the internal tension between States and that between nations.

GIF by European Commission


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