In the Financial Times‘ Summer Reading list of best books of 2014 so far, Martin Wolf calls European Spring:
A splendid book on the European malaise. Legrain argues compellingly that policy makers’ response to that crisis was and remains a disaster. He warns that the eurozone is still far from healthy and that the German example, which members are supposed to follow, is a delusion. He notes, too, that the UK’s recovery is built on sand. He goes well beyond this to show that radical reforms are needed to produce an “adaptable, dynamic and decent” Europe.
I was interviewed by Sophie Roell of fivebooks.com about Europe and in particular five excellent books on Europe
The euro was supposed to facilitate economic convergence between the countries using it and foster the development of a stronger ‘European’ identity. Philippe Legrain argues that the reverse is now happening. European policy-makers are mostly to blame, because of their attempt to create a Germanic and technocratic eurozone. They have damaged the currency union by failing to address the root causes of the crisis. And by further constraining governments’ scope to respond to democratic pressures, they have eroded the legitimacy of both national and EU institutions. The eurozone needs to change direction. So long as a fiscally federal eurozone remains out of reach, governments should work towards a flexible one comprising a genuine banking union, a reformed ECB and greater fiscal flexibility for governments.
“Se suponía que el euro serviría para facilitar la convergencia entre países; durante años eso fue, a grandes rasgos, lo que sucedió. Hasta que llegó la crisis y Bruselas, de la mano de algunas capitales, impuso una serie de políticas que han acelerado el proceso contrario”, indica Philippe Legrain, exasesor del presidente de la Comisión Europea, José Manuel Barroso.
“Los políticos europeos llevan meses declarando victoria porque asoma algo de crecimiento después de que con sus recetas causaran innecesariamente una profunda recesión. Pero los españoles son comparativamente más pobres debido a una respuesta a la crisis errónea e injusta”, dice el autor del sugerente Primavera Europea.
Read my article on the wider context of the EU elections for Quartz on 26 May 2014
In his review of European Spring in the Financial Times, Ferdinando Giugliano writes:
His book is a well-informed and blistering critique of errors made by European policy makers since Greece revealed the extent of its fiscal woes in 2009-10. It is essential reading for those who wonder how an economic powerhouse managed to stumble into a sovereign debt crisis that ended up threatening its very existence.
The EU has just had 28 national elections rather than one European one. Even so, some trends stand out:
1. Most people didn’t bother to vote.
Even with the enhanced powers granted to the European Parliament by the Lisbon Treaty, the novelty of candidates campaigning to be European Commission president and a chance to cast a verdict on the disastrous policy response to the worst crisis since the 1930s, only 43% of Europeans bothered to vote. Ludicrously, EU insiders celebrated that as a success!
Excluding countries where voting is compulsory, the only countries where a majority of people voted are Ireland (where turnout fell from 58.6% to 51.6%), Italy (where it fell from 65% to 60%) and Malta.
2. Support for incumbent parties collapsed in crisis-hit countries.
Except in Germany, which has scarcely suffered from the crisis, and Italy, where Matteo Renzi’s government is only months old, incumbents got whacked.
In Britain, the Conservative Liberal Democrat coalition fell from 40.4% (27% +13.4%) to 30.8% (23.9% + 6.9%)
In Spain, the PP (right-wing) plunged from 42.2% in 2009 to 26.1%.
In Greece, the New Democracy (centre-right) PASOK (centre-left) coalition sank from 69% (32.3% + 36.7%) to 30.8% (22.8% + 8%).
In Ireland, the Fine Gael (centre right) Labour coalition sank from 43% (29.1% + 13.9%) to 28% (22% + 6%).
In Portugal, the PSD (centre-right) CDS (right-wing) coalition fell from 40.1% (31.7% + 8.4%) to 27.7%
In France, the Socialists slipped from 16.5% to 14%.
In the Netherlands, the VVD (centre-right) Labour coalition slipped from 23.4% (11.4% + 12.1%) to 21.4% (21% + 9.4%)
3. The previous ruling party, also tarred with responsibility for the crisis, generally failed to benefit.
In Spain, the PSOE (centre-left) polled 23%, down from 38.5%.
In France, the UMP (centre-right) got 20.8%, down from 27.8%.
In Ireland, Fianna Fail (centre-right) got 22%, down from 24.1%.
Two countries bucked the trend.
In Portugal, the Socialists got 31.5%, up from 26.5%.
In Britain, Labour did much better than in 2009, polling 25.4%, up from 15.3%, but still coming second behind UKIP.
4. The main beneficiaries were extremist parties, mostly of the far-right.
UKIP topped the poll in Britain, with 27.5%, up from 16.1%. The combined far-right vote (UKIP + BNP + English Democrats + An Independence from Europe) vote rose from 23.9% to 31%.
Marine Le Pen’s Front National came first in France, with 25%, up from 6.3%.
The Danish People’s Party also came top, with 26.7%, up from 14.8%.
Austria’s Freedom Party came third, with 19.5%, up from 12.7%.
Neo-Nazis came second in Hungary (Jobbik polled 14.7%), third in Greece (Golden Dawn got 9.4%), fifth in Sweden (the Sweden Democrats got 9.7%) and gained a seat in Germany.
Flemish Nationalists came top in Belgium.
On the far-left, Syriza came top in Greece, with 26.6%, up from 4.7%.
Beppe Grillo’s anti-establishment 5-Star Movement got 21.6% in Italy, but was trounced by the centre-left.
5. Fortunately, some countries resisted extremism.
In Spain, where support for the traditional governing parties plunged from 80.9% to 49%, the country seems inoculated against far-right extremism by its recent experience of fascist dictatorship, so the main beneficiaries were a variety of centrist parties.
In Portugal, which also emerged from fascist dictatorship only four decades ago, the swing against the traditional governing parties was smaller, and the beneficiaries also varied.
In Ireland, independent candidates topped with poll, with 24% of the vote.
In the Netherlands, the social-liberal Democrats 66 party came first, with 15.5%, pushing Geert Wilders’ racist PVV into third place on 13.4%.
6. Apart from extremists, the big winners are Angela Merkel and Matteo Renzi.
Angela Merkel’s CDU-CSU won the German poll, confirming her position as the de facto leader of Europe’s centre-right. The CDU-CSU will continue to dominate the EPP (European People’s Party) group, which lost many seats but will still be the biggest in the European Parliament. She will have a decisive say over who the next European Commission president is, perhaps Jean-Claude Juncker after all.
Matteo Renzi scored an overwhelming triumph in Italy, winning 40.9%, nearly twice the score of his nearest rival, making him the de facto leader of Europe’s centre-left. The PD will become the biggest bloc in the S&D (Socialists & Democrats) group, which is set to finish slightly behind the EPP. With a huge mandate for reform, and with Italy set to take over the rotating presidency of the EU in July, he is best-placed to demand a different crisis response, including a more flexible interpretation of EU fiscal rules.
I was interviewed on Today FM’s The Last Word with Matt Cooper about the collapse in support for mainstream parties ahead of the European elections. It starts 19 minutes in
I was interviewed by Sebastian Stodolak for Obserwatorfinansowy.pl ahead of my speaking at the European Financial Congress in Sopot, Poland on 23 June 2014.