The northern German state of Lower Saxony, home to eight million people, rarely makes headlines, and the international media barely registered this Sunday’s election there. However, its outcome could have huge repercussions for Europe.
This otherwise-minor regional election could trigger German Finance Minister Christian Lindner to double down on his already hawkish position on joint EU debt and the relaxation of the bloc’s fiscal rules.
The election was a massive blow for the liberal FDP and Lindner, its party chief. For the first time since 1998, the party won’t be represented in the regional parliament as it did not pass the requisite 5% threshold.
Worse still, it is the fourth regional election in which the liberals have lost ground. The spectre of the year 2013, when the FDP lost all of their seats in the Bundestag, looms large.
For the FDP, the disastrous outcome means they have to be more assertive in their coalition with the Social Democrats and the Greens.
General Secretary of the FDP, Bijan Djir-Sarai, was quick to declare after the election debacle that the voice of his party has to be “more visible” in the coalition and that they have to “prevent leftist projects from being implemented”.
Lindner also intervened, stating that his party has to do more to “refine its profile” for potential voters.
In the last couple of months, we have already seen that Europe is not being spared either from the FDP’s push or from this profile ‘refinement’, as fiscal austerity runs at the heart of the liberal party and is always an easy way to appease its voter base.
And there is already precedent for that.
After the FDP lost their last election in May, Lindner quickly adopted a harsher tone towards the Southern European member states aiming to make the EU’s debt rules more flexible.
While up to this point, Lindner tried to be understanding of the needs of the southern EU countries, the self-proclaimed “friendly hawk” suddenly became unfriendly.
“You can become addicted to government debt, and we need to end the addiction to more and more debt as soon as possible,” he said in mid-May.
The harsh statement was widely regarded as driven by domestic reasons – to signal to their voters that the FDP is still the party of austerity.
This time, the FDP is likely to double down even more and tighten its already harsh stance on fiscal issues. This month alone will provide multiple opportunities for Lindner to prove his point.
Firstly, the European Commission is set to release its proposal for reforming the stability and growth pact, which regulates the amount of debt a member state is allowed to make.
While the EU executive is expected to follow the plea of the Southern member states to make the rules more flexible, this might be an occasion for Lindner to show his fiscally conservative side.
At the same time, there is a growing initiative on the EU level to push for a European solution to fight inflation by resorting to joint borrowing.
While the call for joint borrowing gathers more and more followers – including the European Commission itself – a German finance minister who aims to refine his profile vis-a-vis the “leftists” is unlikely to give in and agree to anything that could resemble it.
The Roundup
The European Commission will recommend granting candidate status to Bosnia and Herzegovina as part of its annual enlargement report on Wednesday (12 October).
The Body of European Regulators for Electronic Communications raised several critical points in its preliminary assessment of an upcoming senders-pay model that would see the most data-intensive platform contributing to the financing of digital networks.
The European Data Protection Board’s chair Andrea Jelinek sent a ‘wish list’ of procedural aspects to be harmonised at the EU level to the European Justice Commissioner Didier Reynders, in a letter published on Wednesday (12 October).
Discussions on the French budget got off to a tense start in the National Assembly this week as the opposition dismissed the proposed fiscal plan as “austerity” and the government insisted that it protects households.
Faced with questions from EU lawmakers on Monday, pharmaceutical giant Pfizer remained vague about its vaccine purchase contracts, and the text messages exchanged with European Commission President Ursula von der Leyen.
The Czech Presidency proposed raising the threshold to trigger the presumption of employment for platform workers in a new compromise text dated 10 October.
Berlin and The Hague have tabled joint proposals for EU countries to tackle the energy crisis as a bloc and secure gas supplies for next year’s winter.
The European steel industry will continue receiving free CO2 pollution permits as part of the reformed EU carbon market, according to the European Parliament’s chief negotiator who said the deal was “good for jobs and investments in Europe”.
Tenders for onshore wind capacity in Germany, which determine the number of windmills that will feed electricity into the grid, were again undersubscribed in spite of record energy prices.
The European Commission has declined to commit to moving forward with the delayed revision of the regulation on chemicals on the back of a deepening rift between the socialists and the centre-right groups of the European Parliament over the issue.
Last but not least, be sure to check out this week’s Green Brief: The last piece of the EU’s energy crisis puzzle.
Look out for…
- Justice and Home Affairs Council meeting on international crimes in Ukraine, environmental crime, and fundamental rights.
- EU High Representative Josep Borrell participates in meeting of NATO defence ministers.
- Health Commissioner Stella Kyriakides meets with Xavier Becerra, US health and human services secretary.
- International Trade Committee delegation visit to Northern Ireland to discuss resolving current conflict over Northern Ireland Protocol.
Views are the author’s.
[Edited by Nathalie Weatherald/Zoran Radosavljevic]
Source: euractiv.com
