Hey, big spender! EU prepares to splash the cash

Press play to listen to this article

Voiced by Amazon Polly

Paul Taylor, a contributing editor at POLITICO, writes the “Europe At Large” column.

PARIS — It took the coronavirus crisis to persuade the European Union — and especially its German paymaster — that it’s finally time to spend, spend, spend.

The Continent’s tectonic plates have shifted not once but twice since the long-term EU budget was last negotiated seven years ago — both times to the detriment of the Union’s self-appointed guardians of fiscal discipline and parsimony.

First came Brexit. Not only has the United Kingdom’s departure left a giant hole in the EU’s future revenues, it has dispossessed the bloc of its most powerful champion of free trade, unfettered competition and — crucially — limited EU spending.

The second earthquake came when Germany, the largest net payer into EU coffers, abruptly crossed the floor last month. Throughout the 2010-2015 eurozone debt crisis, Berlin led the camp of Northern creditor nations opposed to any debt mutualization.

“The more the big two come with a take-it-or-leave-it package, the harder it makes life for the other countries” — Anonymous Nordic diplomat

Today, along with France, it has become the biggest champion of collective borrowing, throwing its decisive weight behind a massive recovery fund to help countries hard hit by the coronavirus pandemic. Germany is also backing a much bigger EU budget.

This is bad news for the rump caucus of Northern states known as the Frugal Four: the Netherlands,

 » Read More at politico.eu