The Eurogroup meeting on Monday was another disgrace for the 18 eurozone finance ministers. According to reports by Brussels correspondents, German finance minister Wolfgang Schaeuble spent hours of discussing with Poul Thomsen, the Europe representative of the International Monetary Fund, on the Greek issue. Behind closed doors. The rest of the 19 eurozone ministers had travel to Brussels for the sake of registered presence. They had to pass the time in the meeting hall yawning in striking boredom, while Germany was putting inconceivable demands on the table.
The Eurogroup meeting on Monday was another proof that the EU’s and the eurozone’s informal body has been long operating beyond the limits. From an official discussion forum for the eurozone finance ministers, the Eurogroup has transformed into the ad definitum finem sphere of German influence. The lack of resistance by other member states has crowned Schaeuble into the absolute ruler. And the blame burdens the shoulders of the 18 eurozone ministers, who have been acting soft and let it prevail.
Seen at Eurogroup May 22: The haircut Triplets, as someone called them on Facebook
With the delay of almost ten years, now there are growing calls to change the way the Eurogroup operates.
Eurogroup critics say it acts like a private club
Critics of the gathering of finance ministers from the 19 countries in the euro and officials from the European Central Bank and European Commission accuse it of acting like a private club. They want greater transparency in keeping with the influence it wields over issues of vital importance to many of the eurozone’s 350 million citizens, Politico.eu stresses in a relevant report.
- “The euro crisis changed everything,” said Leo Hoffmann-Axthelm, an advocacy coordinator with the NGO Transparency International. “The Eurogroup should be institutionalized, with proper rules of procedure, document handling and a physical address with actual spokespeople. We can no longer be governed by an informal club.”
Although the Eurogroup can impose tough conditions for bailing out struggling member countries or rescuing banks, it publishes no official minutes, has no headquarters, and the people who function as its secretariat have other day jobs. Its public face is a eurozone finance minister, who works for no salary: The current president is Jeroen Dijsselbloem, a Dutch Socialist with conservative views on fiscal matters.
Legally, it is governed by a single sentence in Article 137 of the EU treaty which says “arrangements for meetings between ministers of those Member States whose currency is the euro are laid down by the Protocol on the Euro Group.”
- Emily O’Reilly, the EU’s ombudsman, is among those calling for reform. “It is obviously difficult for Europeans to understand that the Eurogroup, whose decisions can have a significant impact on their lives, [isn’t] subject to the usual democratic checks and balances.”
If minutes of its meetings were made public, outsiders might not like what they saw.
- When a group of citizens from Cyprus who disagreed with the terms of the 2013 Cypriot bank bailout took their case to the European Court of Justice, the court’s response was that the Eurogroup is not “capable of producing legal effects with respect to third parties” because it is just a discussion forum.
Some of those who participate in Eurogroup meetings argue that its informality is precisely what makes it useful.
This week, the Eurogroup met behind closed doors to discuss the latest chapter in the Greek story, but neither the Greek public nor people in the other EU countries funding the €86 billion bailout program — the third of its kind — got to follow the debate, which failed to produce a final agreement on debt relief.
According to one senior official who has attended many Eurogroup meetings, a handful of people do nearly all the talking on Greece — the group’s president and the ministers “from Germany, France, the Netherlands and Greece, plus the Commission, sometimes Italy.”
- Some ministers can’t get a word in edgeways because the proceedings take place in rapid-fire English. “Germany clearly puts pressure on a lot of member states,” added the official.
Michael Noonan, the finance minister of Ireland, was the only one to ever speak up.
- “Often the real decisions are taken in preparatory meetings,” said Maria Joaõ Rodrigues, a Portuguese MEP who specializes in eurozone governance. Ministers hide behind expert views, but “if there was more transparency around final debates, ministers would be confronted with their own [national] public opinions.”
While it takes minutes, it doesn’t publish them nor, as the EU ombudsman has noted, does it have any formal operating procedures.
- Former head of Eurogroup, Jean-Claude Juncker admitted to a meeting of the federalist European Movement in May 2011 that he viewed it as necessary to lie to the public about certain aspects of eurozone management, and that the Eurogroup was a place for “secret, dark debates.”
- Ex Greek finance minister, Yanis Varoufakis, who delivered a battle for reforms in the Eurogroup, said that “there is no intellectual exchange of any substance whatsoever.” He likened the Eurogroup to a policy-laundering system used by the European Commission, ECB and International Monetary Fund to give their austerity policies an air of democratic respectability.
The Eurogroup met for the first time at Château de Senningen in Luxembourg on June 4, 1998, with the task of coordinating economic policy during the countdown to the launch of the euro.
Tolerance and accountability
Can an informal body take important financial decisions that affect millions of lives thus operate without transparency and accountability? The eurozone finance ministers apparently believe it can.
Blondes show the way
How about the eurozone and European citizens?
PS I think it is high time, the European citizens speak up. All we have to do is to register with European Commission’s European Citizens Initiative and demand transparency and accountability by the Eurogroup. It needs one million signatures by citizens from least 6 member states.
The lack of democratic oversight and the increasingly opaque way it is being run are the cancers eating the EU from the inside. Unless something is done quickly to give the average citizens more of a say into how their own future is being decided and unless urgent calls for greater transparency and accountability are answered, the EU is headed for a catastrophic implosion.
Germany has a huge share of responsibility in the unraveling of the EU. Its uncompromising intransigence on the principle of strict implementation of reform measures, and its monomaniacal insistence on the rigid application of rules and directives regardless of the social (and other) costs these create downstream is fueling nationalistic, populist reactions all over Europe and leading the continent over the cliff.
Its leadership style is one in which “lesser players” are sidelined and it lacks the capacity to act in a way that takes responsibility for the stability of the system as a whole. It prefers the mindless application of rules and regulations over the nimbleness required to address rapidly shifting situations. Stability, for the Germans, is always preferable to volatility even if it means staying the course as the European ship is headed straight into a looming iceberg.
The problem with all this is the fact its the smaller players that end up broken and in pieces after the predictable shipwreck.
I believe the IMF is trying to help Greece. They called the terms with the EU “Draconian” and and that the terms of austerity are too harsh. Of course Schäuble and Germany don’t agree.
In a strongly worded assessment on May 23,2017:
the IMF said that there was no prospect of Greece meeting the draconian
terms of its current bailout plan and that interest payments on the
soaring national debt would eat up 60% of the budget by 2060 in the
absence of debt forgiveness.
The debt sustainability analysis by the Washington-based Fund said
Greece should have longer to pay, have the interest rate on its loans
fixed at 1.5%, and that its creditors should make debt relief automatic
once the bailout program ends in 2018.
it looks so but I don’t think so. I understand the media used term ‘draconian’ not the imf
“X” is bludgeoning you to death with a big stick I helped him collect in the forest. Instead of taking the stick out of “X”‘s hands so the bludgeoning can stop, I let it go on BUT I say that I’m concerned that you will eventually dir. So concerned in fact that I agree to let “X” keep bludgeoning you just as long as they refer to the big stick from now on as a “twig.”
The IMF is helping Greece in the same way a drunk helps a man being drowned by a cement block tied to his legs by yelling instructions to him on how to swim the butterfly stroke.
Well said Tintin!
And the truth is that once the country concerned (Greece) is governed by Quislings, employees in Schaeuble’s payroll, there is nothing that can be done unless they are overthrown and unless the production line of treason is destroyed.
This is the real problem of the country: the abundance of willing traitors on offer at cheap prices.