The EU is back – the US is not

By Shlomo Maital

The Brexit fiasco generated enormous pessimism about the future of the European Union. There was talk about Italy leaving the EU, after extreme elements there broached the idea, or even Netherlands, which resents handouts to spendthrift EU nations.

   Well, the EU is back. Here is what the Financial Times reported on the bailout deal struck yesterday, after four long days of meetings, wrangling and compromise:

     “EU leaders have struck a deal on a landmark coronavirus recovery package that will involve the European Commission undertaking massive borrowing on the capital markets for the first time.   After days of sometimes bitter debate, the bloc’s heads of government agreed on a €750bn package aimed at funding post-pandemic relief efforts across the EU. The deal was announced in a tweet from Charles Michel, the European Council president at 05.31am (CET) on Tuesday and was hailed by Emmanuel Macron, the French president, as a “historic day for Europe”.   The recovery fund centers on a €390bn programme of grants to economically weakened member states — a significantly smaller sum than the €500bn package originally proposed by Berlin and Paris in May. Leaders also signed off on the EU’s next seven-year budget, which will be worth €1.074tn.   The deal, orchestrated by Angela Merkel, the German chancellor, and Mr Michel, is the fruit of marathon negotiations under way in Brussels since Friday morning. The summit was the second longest in the bloc’s history, falling just shy of the record set at a meeting in Nice in 2000.”

  Once again, Angela Merkel, the lame-duck Chancellor of Germany, long after she announced her retirement, has returned to bring together disparate EU elements – from the autocratic Hungarian leader Viktor Orban, to the frugal four northern nations.

   Smaller frugal nations won an agreement to increase their rebates from the EU — Austria’s annual reduction will be doubled to €565m a year ($644 m.) compared with previous proposals, while the Netherlands’ rebate will jump to €1.92bn ($2.2 b.) from €1.57bn ($1.78 b.) .

   Contrast the ability of the fraught wrangling 27-nation European Union, moving to help the poor nations among it, with the hopeless helpless United States, where a) President Trump dumped responsibility for battling the pandemic on the 50 state governments and their governors, and saw as a result a horrendous second wave emerge, and b) led Republican opposition to provide financial help to state governments, while pressing them to re-open schools on Sept. 1, without the money it would take to do so safely.

  A New York Tmes Op-Ed asks, which major nation will emerge strongest from the pandemic? Not the US. And no, not China. Answer: Germany, the enlightened leader of sanity and compromise in the European Union.