Sunday, October 23, 2016

French PM complains the French army is de facto the EU's army, does not want US of Europe

The EU's 27 leaders have already started discussing about the future of the European Union and the UK PM complained she was not invited.

France's Socialist PM Manuel Valls presented some of the main points of what the French government wants in an article in the FT.

He complained that the French army is acting as a de facto EU army and wants the EU to do more, as EU , for control of the EU borders and security inside the EU (remember te terrorist incidents in France).

He wants a US type (ESTA)  but at the same does not want the EU to become federal like the US.

He is also against the intra EU posting of (EU) workers because they bypass member states' national labour standards.

He also wants corporate tax rates among the member states to converge and says that if not all member states agree that should established with those that agree. That of course will require Treaty changes because income, personal and company, is not a competence of the EU. So in effect he is proposing something like a Taxation Protocol (such as the Social Protocol the UK vetoed at Maastricht in 1991 and thus became valid for all except the UK, later Blair's UK joined in). What is not clear at all is what incentive members that agree will have to agree to such a change. Eg Ireland. Give up its low corporate tax rates that attract US and other companies in return for what? And that shows not only the inadequacy of piecemeal approaches to the EU as well as the tight spot the EU is in.

Please see other recent posts on what the EU needs.

Valls talks of EU financing of digital and tech innovation as a means to give the EU more growth. Too little and probably mis-targetted. In my opinion the EU economy must start to work better as system  and that requires systemic improvements not piecemeal approaches.

Valls also thinks the CETA agreement between the EU and Canada is good for the EU (currently blocked by a veto by Belgium's Wallonia) and wants a US-EU deal that benefits the EU, thus implying the one negotiated is not. One has to note that neither Trump nor Clinton are very pro free trade.

Of course each member state is putting forward its own key requests out of a potential change in the EU Treaty. Previous Treaty changes not only suffered from rejection by member states but also from a piecemeal approach.

The Visigrad 4 (Poland, Hungary, Czech Rep. and Slovakia) want less Europe (less EU).  The process to Treaty revision will be long and hard because after all Euroscepticism is higher than recent times.

One has to keep in mind that M. Valls is a Socialist and after next year's Presidential election the President will most likely not be a Socialist (Hollande) and thus M. Valls will not longer be a PM.

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