Attention in the European Council has turned from unity over Brexit to whether France and Germany can find a unifying policy direction for the EU27. The view in Paris is that Franco-German compromises offer a realistic balance between the interests of member states in the west, east, north and south, and that a joint platform is more achievable without the need to take account of a London outlier, especially on economic policy and defence cooperation.
Last week’s ECJ judgement on the ‘mixity’ question in EU trade agreements was a big one for EU trade policy. The ECJ overturned the Advocate General and years of practice by declaring that almost all of the things the European Commission negotiates on in FTAs should be treated in this respect as the exclusive competence of the EU. This includes big areas like transport policy, labour and environmental rights and IP protection.
The election manifesto of the governing UK Conservative Party published yesterday was the most ambitious attempt to redefine British conservatism since the 1980s. It did this not by calling for radical policy change – it recommitted to radical policies like Brexit and set out a wide range of aims and ideas but little that is new – but by ambitious repositioning and some big rhetorical departures. Gone is Margaret Thatcher’s minimal State; Gone is David Cameron’s ‘Big Society’ of self-helpers.
The European Commission published this week its assessment of how the benefits of globalisation can be harnessed, while addressing the anxieties that are also created and which are impacting on political debates across Europe.
When it finally came, UK Prime Minister Theresa May’s announcement that she would introduce a cap on energy prices if re-elected was made more in anger than in sorrow. Declaring in the Sun newspaper that she is “fed up with rip-off energy prices” May promised to cap the ‘standard variable tariffs’ (SVT), through which most UK households buy their energy. The cap will be put in place by the regulator Ofgem, and although not all details are yet clear, May’s expectation that it would “save families on poor value tariffs as much as £100” strongly suggests the imposition of a cash limit.
Today, the BEIS Select Committee released its report on the UK government’s Brexit negotiating priorities on energy and climate change. The report highlights important issues, including the need for a delay in the UK’s exit from nuclear cooperation agreement Euratom, potential “special arrangements” to maintain a single Irish energy market, and the view that the UK should not leave the EU-ETS before 2020, but should consider alternatives if the EU-ETS cannot be reformed. But largely it is a plea for the status quo, reflecting both the economic benefits of membership of the internal energy market and the views of a sector which mostly believes that Brexit’s energy challenges can be separated from its turbulent politics.
The NASDAQ reached an all-time high yesterday as Donald Trump announced he wants to more than halve the US corporation tax rate, from 35% to 15%. But he knows that doing so comes with a big price tag – one that, in the context of a fraught debate about the US national debt and deficit, is an almost impossible sell to Congress. The solution? Dynamic modelling: counting the economic growth gains that the cut might create when calculating its cost, to show that in fact there is a net benefit to the Treasury’s coffers.
When the finance ministers of the world’s largest economies gathered in Washington over the weekend they had in front of them IMF analysis of the global economy that for once was quite up-beat. The growth forecast is higher, financial markets are buoyant, and a long-awaited cyclical recovery is underway in many economies.
With the UK now set for a general election on 8 June, attention has turned to the party manifestos. Given the general expectation that the Conservatives will win a large new majority, their platform is of particular interest. With very little constraining political opposition, UK Prime Minister Theresa May has the freedom to be as innovative as her admittedly cautious nature allows. The election is a chance to formalise her own, post-David Cameron agenda: a manifesto version of what she has already done with her cabinet. What she says on Europe and Brexit will be picked through minutely. So, what should we look for from a May manifesto?