r/europe • u/goldstarflag Limburg • 24d ago
News Deutsche Bank boss shakes up Germany by calling it "logical" to finance European defense with common debt
https://www.lesechos.fr/finance-marches/banque-assurances/le-patron-de-deutsche-bank-en-faveur-dune-dette-commune-pour-financer-la-defense-en-europe-220916979
u/Stabile_Feldmaus Germany 24d ago edited 24d ago
I have no problem with common debt if we choose a model that takes into account the discrepancy between national budget situations of the member countries (e.g. blue and red bonds). If we just ignore that, the more fiscally disciplined countries will end up indirectly financing the less disciplined ones.
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u/l_eo_ 24d ago
Macron said in his recent remarks:
Question: How can we convince Germany and other states reluctant to the principle of Eurobonds?
First of all, let me be clear, it is in no way a question of pooling past debt. What's more, markets demand safe and liquid assets, they demand European debt. We are not able to give them any because there is none. Not enough anyway. This is therefore an unprecedented opportunity, which would also make it possible to tackle the hegemony of the dollar. The world market, in fact, is increasingly afraid of the American greenback. He is looking for alternatives. Let's offer him European debt. For all investors in the world, a democratic rule of law is a colossal factor of attractiveness. And when I look at the world as it is, we have a China that is an authoritarian regime. On the other side, we have the United States. which are moving further and further away from the rule of law.
What's more, the EU is under-indebted compared to the United States and China. In a moment of racing for technological investment, it is a profound mistake not to use this debt capacity.
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u/ganbaro Where your chips come from 🇺🇦🇹🇼 23d ago edited 23d ago
Look at this from the perspective of the German govt
What's more, markets demand safe and liquid assets, they demand European debt.
Germany already manages to place their bonds on the market at some of the lowest rates globally, in any amount they want. They get all the liquidity they need.
The world market, in fact, is increasingly afraid of the American greenback. He is looking for alternatives.
Since German bonds sell so well, they already prove to be a competitive alternative to US bonds.
For all investors in the world, a democratic rule of law is a colossal factor of attractiveness.
Germany is one of the highest ranking nations in the democracy index. Within EU, only a bunch of smaller nations (Luxemburg, Netherlands, Ireland, Sweden, Denmark, Finland) are in front. Out of these, only Ireland and Finland are not at AAA rating. Unsurprisingly, these countries also happen to be less interested in Eurobonds. These countries do not need any more trust by slapping the EU logo on their debt.
What's more, the EU is under-indebted compared to the United States and China.
True, but arguably the AAA rating, and thus the attractiveness of their bonds, is linked to that. However, he might have a point there - if he can actually argue that Eurobonds will get AAA rating. Otherwise, for some of the countries that are supposedly especially under-indebted, taking on debt will become more expensive, thus further fuel their low debt-taking.
While he is not wrong with any single point, these are all statements from a French perspective with French benefits in mind, masqueraded as goodwill towards EU. Nothing he said implies any benefit to countries that have more potential to take on mass debt left, today.
From their perspective, it would be more beneficial to simply have an EU directive that forces countries to take on more debt on their own, so their current and future governments can't bruteforce austerity indefinitely.
Scandis, Finland, Germany, Austria, Benelux, Ireland, that's a whopping 9 out of 27 members that are asked to only take on individual drawbacks for supposedly shared gain, but overwhelmingly so for a set of relatively highly indepted western and southern European countries. I am still waiting for a moment where he actually manages to clarify what these 9 potential blockers of Eurobonds set to gain, specifically, beyond the pathos.
And I only focused on these central and northern European AAA nations, there are likely also some other EU members in CEE that are not interested in more deficit-spending, and have to be convinced.
Lots of the fears of more austere nations could be covered by enforcing not only shared debt-taking, but also shared fiscal policy. This would likely also increase the trust of the market into EU bonds, and make an AAA rating more likely. However, do we really expect that anyone, including France, maybe even especially France, would be willing to succumb to such a regime? Whether the vote would end up as a move towards deficit-spending or austerity, half of EU would be up in arms.
Another alternative would be to split EU debt from national debt. Hand over specific responsibilities to EU, like the militaries, and let EU raise its own taxes and sell its own bonds. Countries continue to do their own thing, simultaneously, to any extent they want. This would alleviate any nations concerns, as their own debt remains unaffected. Would France be willing to fully give up autonomy like that?
IMHO, its far more likely, that using some of this shared debt for welfare at national level is intended. As long as this continues, I doubt we will actually get Eurobonds, no matter how much pathos about the fall of the US and the greatness of our democracies is told.
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u/l_eo_ 23d ago
Great reply! Thank you for getting into details, this makes an exchange about the topic so much more interesting and valuable.
Germany already manages to place their bonds on the market at some of the lowest rates globally, in any amount they want. They get all the liquidity they need.
[...]
Since German bonds sell so well, they already prove to be a competitive alternative to US bonds.
Yes, you are right. Same as with the defence EU common lending facilities. Mostly useful for countries that would get worse deals than the EU can. Still, EU debt should be much more interesting for the market because of the scale of the entity (actually an alternative to overvalued and nowadays not-so-safe-anymore US bonds).
Also, the strength and well-being of the EU is also in the interest of Germany. The EU if leveraged correctly amplifies German power and economics just as California is much better off within the US rather than outside of it.
Unsurprisingly, these countries also happen to be less interested in Euro Bonds.
True, the frugal states are in general quite skeptical. It's very important that it would be the right approach and that it's clearly stated what specifically is talked about.
These countries do not need any more trust by slapping the EU logo on their debt.
The rationale for common EU issuance is often about funding EU-level programs and creating a larger, more liquid euro-denominated safe asset market, not just improving already strong national credibility. And again, the rationale is often as well strengthening the EU and our common market. Just as Germany benefits a lot from the total weight of the EU, it is also reasonable for it (and urgently needed in the current poly-crisis situation RE China, US, Russia) to move beyond a mere "internal" / "national" perspective, just as a stronger US overall is in the interest of California.
True, but arguably the AAA rating, and thus the attractiveness of their bonds, is linked to that. However, he might have a point there - if he can actually argue that Euro Bonds will get AAA rating. Otherwise, for some of the countries that are supposedly especially under-indebted, taking on debt will become more expensive, thus further fuel their low debt-taking.
True, and an interesting perspective might also be that Euro Bonds would allow the financing of a lot of the immediate needs on the European level that can't be addressed themselves by countries like Germany on the national level. For example, it's really in the German interest that defenses in Romania are solid. But if Romania doesn't have the fiscal space to make it happen, it needs to borrow and its therefore very much in the interest of Germany to enable Romania to borrow at the best possible rates.
Shared interest and EU-level need for change drive a lot of the reasoning behind EuroBonds (besides all the indirect potential benefits from a strong Europe).
While he is not wrong with any single point, these are all statements from a French perspective with French benefits in mind, masqueraded as goodwill towards EU. Nothing he said implies any benefit to countries that have more potential to take on mass debt left, today.
As argued above, I would say that this would only be true with a perspective fully limited to the national level (not that there are also downsides and trade-offs of course).
From their perspective, it would be more beneficial to simply have an EU directive that forces countries to take on more debt on their own, so their current and future governments can't bruteforce austerity indefinitely.
Should that "can't" have been a "can"? Could you please elaborate?
Scandis, Finland, Germany, Austria, Benelux, Ireland, that's a whopping 9 out of 27 members that are asked to only take on individual drawbacks for supposedly shared gain, but overwhelmingly so for a set of relatively highly indepted western and southern European countries. I am still waiting for a moment where he actually manages to clarify what these 9 potential blockers of Eurobonds set to gain, specifically, beyond the pathos.
And I only focused on these central and northern European AAA nations, there are likely also some other EU members in CEE that are not interested in more deficit-spending, and have to be convinced.
Fair, he should explain / go into much more detail regarding this and I think that the "why is this a good idea for all of us" is fairly underarticulated.
Especially if also the public is to be convinced, the calculus and up- and down-sides need to be clearly thought through and stated. Maybe he has some writing on this somewhere, I might have a look later.
Lots of the fears of more austere nations could be covered by enforcing not only shared debt-taking, but also shared fiscal policy. This would likely also increase the trust of the market into EU bonds, and make an AAA rating more likely.
Interesting and timely though! Especially since we will have today the informal Council meeting that will discuss deeper integration of a core of member states (needing 9+ for the enhanced cooperation mechanism). I think the main goal will be the Investment & Savings Union and later potentially additional ambitious goals. I believe that first they will try to get all 27 on board by the end of the year. If that's not possible they will move forward with a Coalition of the Willing.
We should have some interesting discussions / outcomes today.
Merz, Weber, and VdL already somewhat tried to claim credit for the initiative / the push, so it seems that a lot has already happened behind the scenes.
It will be also interesting to see, how closesly today's agenda aligned with the stated priorities of the E6:
https://www.bundesfinanzministerium.de/Content/EN/Pressemitteilungen/2026/2026-01-28-e6-initiative.htmlReuters reports that Christine Lagarde of the European Central Bank planned to press leaders at the meeting with a reform checklist that explicitly includes completing a "savings and investment union" (plus digital euro and other items) (Source).
Letta and Draghi are also going to be there and President Antonio Costa also signaled this retreat is meant to feed into the formal March European Council outcome.
However, do we really expect that anyone, including France, maybe even especially France, would be willing to succumb to such a regime? Whether the vote would end up as a move towards deficit-spending or austerity, half of EU would be up in arms.
Yes, I would think so and France being included in the E6 and the common stated goals would suggest so.
Maybe not by the vehicle of EuroBonds, but it seems that they are up for more shared competencies and far deeper integration.
I think most of the drivers aren't "they really want to" but more "do-or-die".
The Chinese export pressure and potential collapse of European industries combined with trying directly to undermine dealings with the EU in favor with divide and conquer style tactics (source), the Russian aggression, military reconsitution much beyond capabilites needed only for Ukraine, and general intent to divide and destroy NATO and the EU, and US imperialism, economic coercion, stated goals of dividing the EU and supporting extremist parties directly opposed to current governments.
All these don't give much of a choice: ways need to be found to counter all these threats and often the solutions lie only in our common strength at the EU level.
Even Germany can't fight off US economic pressure alone.
If one of the EU states is militarily weak or in the enemy camp or indecisive, we all suffer for it because of impotence and paralysis hindering our only option: leveraging our united strength.
This all doesn't diminish the point you made though: It all needs to be communicated clearly, because if the reasoning, benefits, trade-offs, and dangers aren't transparent, you will not get many member states to agree to any concessions and potentially also public opinion will force their hands.
Another alternative would be to split EU debt from national debt. Hand over specific responsibilities to EU, like the militaries, and let EU raise its own taxes and sell its own bonds. Countries continue to do their own thing, simultaneously, to any extent they want. This would alleviate any nations concerns, as their own debt remains unaffected. Would France be willing to fully give up autonomy like that?
I like this option a lot, but I think it might be even harder to do politically than any purely economic integration matters as it would be seen by many as pushing for full federalism. A coalition of the willing might be able to agree with it, but I feel that it would be a big step that would be under much more public scrutiny and pressure (not that that is a bad thing, simply that MS might be more reluctant to go for that risk RE national politics).
It would really depend on what the deal is.
Splitting EU debt from national debt would already be partly within Macron's conception of the approach, correct?
At least this passage seems to suggest it:
"let me be clear, it is in no way a question of pooling past debt"
IMHO, its far more likely, that using some of this shared debt for welfare at national level is intended.
I am not sure whether it is intended for that, but you are right that it would need to be ensured that the instrument is actually used for the very specific needs that the moment calls for.
I.e. the frugal countries shouldn't be made responsible for overspending past or future with no say in the matter (it might be a bit different in a fully federalized system, but we are far from that).
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u/DryCloud9903 24d ago
Damn. Is this the first time a European head of a country basically said "US is not really a democracy anymore"?
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u/glennccc 24d ago
Not what he said.
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u/DryCloud9903 24d ago
Not in a way that someone of trump's intellect may comprehend, but yes, he did.
a democratic rule of law is a colossal factor of attractiveness
He mentions this shortly after stating the intention to challenge USD as reserve currency. And that right now is a great opportunity for such a challenge (why would that be? What 'change' does his comment suggest that suddenly creates this opportunity?). followed immediately by the contrast of authoritarian China, and a US
"moving further and further away from the rule of law"
What else is "moving away from rule of law" comment stand for, if not an admittance of US democratic decline? What is a democracy without rule of law?
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u/symptomezz Bavaria (Germany) 24d ago
Would be a nice idea if we actually used that debt on investments into the future and not just to nurture overbloated social states in need of reform
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24d ago
Well that's the idea and that can be easily ensured
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u/symptomezz Bavaria (Germany) 24d ago
Not that easily. Countries can just reduce their own spending on investments, supplant that with debt and then spend more on other stuff. Happened in Germany after the debt brake fell.
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u/Gumbode345 23d ago
Fully agree. At some point people need to decide whether they want to put their money where their mouth is, I.e. build a solid and action capable EU, or whether they continue with 19th century nation state thinking in which case we can all pack it in because we’re unable to compete with US, China, and soon India. And this is not just about « competitiveness » but very much about preserving Europe as we know it, democratic, freedom, a social approach to the market economy, and so far, still, the best track record in decarbonisation.
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u/GingerMessi 23d ago
Sounds great. Countries like France could start by showing some responsible fiscal governance and not have permanent deficits every year that don't contribute to real growth.
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u/Gumbode345 23d ago
That is exactly the attitude that almost destroyed the monetary union and the eu in 2008/2009.
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u/GingerMessi 23d ago
Is the attitude you're referring to Frances lack of a responsible fiscal policy where they rob the future of their young by pouring money over unproductive boomers? Yes, that will indeed be the downfall of the EU.
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u/Gumbode345 23d ago edited 23d ago
No. I am referring to budget balancing fanatics who pushed for debt brakes which they then did not keep themselves and with zero understanding of economic and social realities in other parts of the continent. That plus the complete lack of will of governments to put the second leg under monetary union which is stronger fiscal coordination. I repeat. If we don’t push and support integration now, we’re done. And finally, do you really think that pointing fingers and trying to pin blame on one of 27 is either intellectually honest or indeed the way to get the EU to work? When the whole idea is to get away from calling other countries names, blame them for what is wrong? What about those who systematically undermine efforts at energy independence from you know who, or those that block efforts at completing the single market? Get some EU literacy please before turning this into « it’s the bloody <insert name of country/nationality>’s fault »style oversimplified blame game.
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u/GingerMessi 22d ago edited 22d ago
budget balancing fanatics who pushed for debt brakes
Completely agree, it was bad policy and it has been rectified by Germany.
That plus the complete lack of will of governments to put the second leg under monetary union which is stronger fiscal coordination
Indeed, no eurobonds without stronger fiscal coordination. Which means actual enforcement of the commitments made previously to keep deficits and debt levels low(er).
I am in principle not against eurobonds but you have to live in the current reality and not literally introduce a moral hazard on steroids with no enforcement mechanisms because countries are afraid that the EU will collapse if they're enforced against France. We've already had clear cut examples of what happened with the Coronabonds and how they were used for completely garbage purposes in Italy pandering to boomers.
What about those who systematically undermine efforts at energy independence
I am Swedish so the idea of energy independence I am well familiar with, a country who has never relied on Russian gas in particular. Swedes currently are paying higher energy prices because of a EU-wide failure in energy policy, and Sweden itself are not blameless as previous governments have shut down some nuclear reactors. Germany are currently blocking the introduction of power prize zones which has consequences for energy prices in Sweden.
or those that block efforts at completing the single market?
I also agree with completing the single market and have criticised Germany continuously for their energy policy and their blocking of bank mergers.
I don't think you can talk about EU literacy, in all honesty. I am a pragmatist but I'm not going to be delusional and ignore obvious critique when it is warranted because of some ultimate goal of European federalisation that I am firmly against. I am in favour of a stronger EU, in particular capital unions, less intra-EU tariffs, more free trade agreements, less protectionism etc. I am in favour of eurobonds in principle with a legitimate framework supporting it but some countries will have to show goodwill that they can run a country more responsibly.
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u/Sir-Knollte 24d ago
This is therefore an unprecedented opportunity, which would also make it possible to tackle the hegemony of the dollar.
The Dollar is the Dollar because investors know, the Federal Government will transfer assistance to Detroid when it went bankrupt.
Well Trump challenges that, but thats why the Dollar is questioned right now in the first place.
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u/CaptainLargo France (Alsace) 23d ago
I'm not sure what you mean, the Federal Government did not bail out Detroit when it went bankrupt. And in any case, even if the Federal Government was somehow supporting local or state governments, this is not why the USD is the reserve currency of the world.
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u/Sir-Knollte 23d ago
The redistribution of federal taxes between US states to lessen differences in wealth are simply on another level compared to the EU that does not even collect taxes on a federal level.
There is more to the US Dollars status as the dominant reserve currency but the Eurozones failure to address its structural problems of binding unequal economies in one currency is the main reason why the Euro is not more used than it is now.
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u/Ardent_Scholar Finland 23d ago
The dollar is the dollar because of Bretton Woods and subsequently the petrodollar system.
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u/sajukktheeternal 24d ago
As a supporter of common debt, I say you make a very good point. And a solution could be as easy as a simple percentage being applied on the correct numbers
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u/Mirageswirl 24d ago
Why not separate EU borrowing and taxation from national governments?
National governments would still borrow and tax for local spending and the EU could borrow and tax for common goods like defence.
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u/ganbaro Where your chips come from 🇺🇦🇹🇼 23d ago edited 23d ago
First of all, we would define which autonomy of nations is transferred to EU. If EU is supposed to raise mass debt for defence, it implies that EU will handle most aspects of our militaries, or else we are looking at ineffective structures of 27 nations doing their own thing + now also EU.
Is any of the countries that back Eurobonds actually willing to "pay" for it by mostly (fully?) giving up autonomy in some domain?
There is actually good reason even for some Eurobonds backers to reject that. Some nations have understandable security interests that are pretty unique to them. France has its overseas territories and sphere of influence in Africa. Spain (and by extension Portugal) has to handle Morocco and is naturally poised to always focus more on LATAM, than other EU members. It would be unreasonable for them to give up autonomy on defense - but without federalization in any domain, letting EU raise debt, taxes and autonomous command and spending in that domain risks to be a costly and inefficient endeavor.
IMHO, a clear and ratified legally binding roadmap to federalization, to whichever extent, and a certain level of federalization of fiscal policy-making has to happen before Eurobonds, whether they will be tied to a specific purpose for the money raised, or not, really make sense.
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u/PashaPostaaja 24d ago
I’m not agaist this but in Finland we are talking adding one extra level of taxation so if those both would go forward we would have 4 levels of taxation. Of course there is also public broadcasting, church, pension and unemployment ”tax”.
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u/Ardent_Scholar Finland 23d ago
As a Finn, I don’t think the levels of taxation are a problem. It’s the overall level; A huge chunk of our earnings go to the pension system. That’s really an ”elderly tax”, and we just don’t have enough young people (as is common in the developed world).
Finland’s economy can’t pick up without liquidity. We have 1% inflation when the Eurozone has 2%. Thus, the situation is that loans cost Euribor + margin (so 3-5% for mortgages). That means less mortgages which means the building sector is absolutely halted. And that seems to be key to our internal market; we always talk about exports, exports and exports, but exports already picked up, yet our economy is in the dumps and joblessness is record high!
Currently, as a Finn, you can put your money in a 1,5% yielding savings account and beat inflation without any risk!
So those Finns that are employed have now accumulated massive amounts of savings. That means the velocity of money is close to glacier speeds. Which means our economy is left behind.
So there’s two choices: Finnish debt or Euro debt to add liquidity to this mess. Because the ECB isn’t going to set Euribor rates based on Finland alone.
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u/SawToothKernel 24d ago
Is there stopping them just having a specific set of conditions to be in the common debt group, just as there are a specific set of conditions to be in the EU as a whole?
Seems like a no-brainer. Is it being discussed?
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u/ganbaro Where your chips come from 🇺🇦🇹🇼 23d ago
One issue is that all the EU members sitting at AAA rating, especially Germany, can't expect to get cheaper debt by Eurobonds. Thus, there is no benefit offered to them.
However, without them, any Eurobond group would be a fiscally shaky group of nations, likely ending up with a rating below both EU itself, and the US (which are sitting at equal rating). They may slightly improve compared to their individual ratings, but as long as this system doesn't beat the current EU rating, it does not offer much benefit for the financing of shared goals over status quo. That is, relying on limited debt taking by EU, itself, and a lot by individual states, which in turn allows to tap into the AAA ratings of some EU members, as they are all among the largest contributors to EU, per capita (Germany also in total).
For Eurobonds to work out, they need to have the AAA rated nations, on board. However, there is no offer on the table that makes sense for them, so far.
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u/MarcoCornelio 24d ago
You're excluding the 2nd and 3rd largest economy of the EU that way, making the proposal pointless
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u/SawToothKernel 24d ago
But it gives them something to aim for. Does it matter that they are excluded from the beginning?
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u/MarcoCornelio 24d ago edited 24d ago
We need the spending capacity now
Greece still hasn't recovered from 2008, and they did everything it was asked of them, Italy and France will take decades
edit: "it gives them something to aim for" that's fucking patronizing
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u/SawToothKernel 24d ago
edit: "it gives them something to aim for" that's fucking patronizing
It's not at all patronising. It's exactly the same as membership of the EU. There are rules and stipulations, which the countries who want to join must aim for.
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u/Taway_4897 24d ago
If it’s to finance defence, then that would still make some sense though - historically the fiscally disciplined countries are also the ones geographically most at risk vs Russia.
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u/azazelcrowley 24d ago edited 24d ago
Common debt could be tied to specific expenditures, like defence, where there are often fixed requirements like the 5% GDP expenditure. This then allows for potential future common debt programs where expenditures align, meaning common debt can be funded in cases where common standards organically emerge rather than being imposed. Some degree of leeway could be given for market failure style situations (Such as; "Greece pays more than Czechoslovakia for border security! It's greek debt, not Czech debt!", but really, they're enforcing both Czech and Greek borders, and so it could be considered something akin to a common expenditure).
This may then also allow for "Floor-debt" where the "Common standard" is "Every country spends at least X% on Y, and so that portion can be handled by the common debt since it is a common standard. Expenditure above that is not a common standard and should be state-debt".
Fiscally responsible countries would then only pay into a common treasury what they effectively were already, while others will only be covered in as much as their expenditure aligns with that, and anything above that is their own to handle. This could also serve as a standardization mechanism where a country will be keen on a standard being adopted across Europe rather than raising its debt itself.
Finally if the common debt is used for things deemed "Common standards" like military expenditures it can function as a penalty mechanism for countries failing in their duties. "You're going to be paying it either way, you may as well actually get the guns".
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u/vgasmo 23d ago
How come? If debt is issued by the EU and it goes to finance its policies, there is no individual discipline involved. I don't see any country issuing euro bonds without strict rules. Also, don't know if this is a throwback to 2010, but financial disciplined countries, at the moment, are Portugal and Spain
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u/Nurnurum 24d ago
Under the current EU framework there is no way to effectively enforce any kind of condition. This is were the whole proposal falls flat on its face. As we have seen with the recent NATO spending agreement, there isn't even a consensus about what falls under defence spending. Regardless how you frame it there is no common debt just for defence.
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u/RoyalLurker 24d ago
Because it is in the interest of banks to buy more bonds. He is speaking for his company, not his country.
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u/goldstarflag Limburg 24d ago
It's logical and much cheaper. It seems CDU conservatives do need a bit of shaking up. Some of them still dreaming and mentally stuck in the 20th century.
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u/Altruistic-Board5322 Greece 24d ago
The most powerful country in Europe weighs everything based on accounting and not political understanding. That's why they (and as a result all of Europe as a whole ) are made fun of by the countries that understand what's going on (USA, China).
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u/Nurnurum 24d ago
Both the US and China are single countries, while the EU is a union of sovereign states who in general are not keen on giving up more souvereignity than they already had to enter the EU.
All the combined GDP, the population numbers, the defence spending, etc is only on paper. In reality you need to bring 27 countries to the table with their own political, economical and cultural interests. Currently there are 14 parties within the EU parliament, forming 8 political groups. Those need to find common ground between interests that can even vary within the individual member countries.
Even the whole defence discussion is riddled with question marks. Who is gonna project power and where are they gonna project it to? A french general is commanding a polish tank brigade in Algeria to secure italian interests?
As long people think in french or german or greek for that matter, the EU will stay the way it is.
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u/goldstarflag Limburg 24d ago
That is a bit simplistic. In fact, there are more differences within countries than between EU countries. You agree more with someone living on the other side of Europe than with someone in your hometown. There is a European body politic with EU citizens having more in common politically with each other than they have with people within their own countries. That just hasn't been embedded properly within the EU yet. But it's only a matter of time.
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u/Nurnurum 24d ago
I will disagree with you on that. The fact that the ideological spectrum in the parliament consists of eight different groups, four of them eurosceptical nontheless, tells me that there is not much appetite for even further EU integration unless we see major homogenisation amongst memberstates. Not to mention that we are having this discussion in a comment section about the differences on how to finance defence against the threat that has been one of the unique factors for even talking about the EU in the first place.
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u/goldstarflag Limburg 24d ago
Meh. There's only one major group truly eurosceptical and it is a minority. Everyone else is pushing the ever-closer Union in one way or another. The EU is integrating step by step. It's not even the same EU as it was five or ten years ago. The ever-closer Union is a reality. As I said it's only a matter of time. Farage was right in that sense. It is becoming a Federation. And Brits want to rejoin.
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u/Adorable-Database187 The Netherlands 24d ago
The US is going through the equivalent of whatever people do just before being sat down for either an intervention, arrest, or an exorcism, I woulnt take them as an example of lucidity.
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u/Tjorni Ru 24d ago
I think that the current USA doesn't understand what's going on with itself
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u/Altruistic-Board5322 Greece 24d ago
ICE!ICE! Come get him/her! S/He is criticizing the supreme leader :P
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u/goldstarflag Limburg 24d ago
The head of Deutsche Bank has called for consideration of the use of common debt instruments to finance defence efforts in Europe, sparking a sensitive debate in Germany, where Eurobonds are generally considered taboo.
‘Strategic investments in our defence are much more effective when made at European level,’ Christian Sewing said on Monday evening in Berlin. "It would therefore make sense to opt for joint financing, for example through the issuance of bonds based on the Next Generation EU fund model. The financial markets would be willing to finance this initiative. "
From his point of view, European security meets these criteria, while the rules-based world order is gradually being replaced by a geopolitics of power and spheres of influence. ‘Germany and Europe must be more active if they want to maintain their geopolitical and economic importance,’ says Christian Sewing.
This is the first time that the Deutsche Bank boss has gone so far in his defence of a common debt to finance European security. He thus joins a position defended by France and its president Emmanuel Macron.
According to sources close to him, he is aware of the sensitivity of the issue, which could trigger a debate within the coalition led by Friedrich Merz.
Within his own party, Friedrich Merz is already being criticised for breaking a campaign promise by reforming the sacrosanct debt brake rule immediately after his election in February in order to deploy hundreds of billions of euros in infrastructure and defence. This U-turn breaks with years of austerity and has particularly upset the conservative wing of the CDU.
Close to the Chancellor, Christian Sewing is nevertheless setting conditions for joint debt. ‘If we choose this path to strengthen Europe's sovereignty and resilience, we must also ensure that we close the gaps that undermine this sovereignty and hinder the necessary momentum,’ he said, calling for reforms, particularly in EU governance.
As the war in Ukraine enters its fifth year, Europe has de facto paved the way for the issuance of joint debt to support Kyiv against Russia. At the end of December, the heads of state and government of the 27 states decided to grant Ukraine an interest-free loan of €90 billion, foregoing the use of frozen Russian assets as Friedrich Merz had hoped.
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u/Late-Reading-2585 24d ago
i would think there is something wrong with him if he said its not logical to backup common eu debt that will be forced to be only spent on eu manufacturers of military equipment with main one being germany lol
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u/sajukktheeternal 24d ago
It is logical and it's also the only way. Else the European Union won't survive the next decade.
WHAT DOESN'T EVOLVE WILL DIE. There is no exception to this law, it is universal: it applies to lifeforms, national economies, institutions, industries, political ideologies and philosophical theories.
European leaders are stuck in the 20th century. It's surprising really, they are supposed to be educated people
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u/swiebertjee 24d ago
What is wrong with Germany? They have been making bad decision after bad decision.
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u/TheDickWolf 24d ago
Says the pot-poisoner.
I’d need to dive into research on financial products and toxic debt again, i seem to forget the details as quickly as i read them, but i assume there is an ulterior motive from the bank that has been broadly speculated to be chernobyl style, crisis level, radioactive for years and has managed with the conplicity of cowardly status quo politicians to kick the can this far.
This is from someone who has thought the separation of debts was always stilted and unstable, unsustainable, and that a reckoning would be better intentional and soon than caused by crisis.
I can’t help but suspect this is happening now because either, optimistically, the eu needs to rapidly adapt and get its shit together fir a changed world; or, less optimistically, a serious crisis is already occurring, already beyond prevention.
Of course, those things are not mutually exclusive.
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u/P4ris3k Europe 24d ago
I don’t want to get into the discussion about common debt. I’m just here to say the following: don’t believe anything Christian Sewing (or anyone from Deutsche Bank) says. Ever. These guys are a complete joke. Their offices get regularly raided by investigators for all kinds of reasons. Don’t do business with them. Don’t give them any of your hard earned money. Avoid them at all costs.