Mark Rutte on the EU

"And I’ve said many times before that I believe the EU is stronger when a deal is a deal.  In the EU there can be no haggling over democracy and the rule of law. We must always draw the line when fundamental values come under pressure, as they have in countries like Poland and Hungary.But a deal is also a deal when it comes to the euro and the Stability and Growth Pact. Because here too, bending the rules can erode the entire system, and we cannot have that. To me the whole idea of the EU is a group of independent member states working together to bring each other to a higher level of prosperity, security and stability. Unity is the source of our capacity to act in the outside world."

Churchill Lecture by The Netherlands Prime Minister Mark Rutte, Europa Institut at the University of Zurich

Speech | 13-02-2019

The Eurogroup has to take a decision that is clear

The Eurogroup meeting of finance ministers is still on at the very end of this evening. It has been a long meeting. And also a very tense discussion, from what I can understand at this stage. All this shows that the EU is confronted with a very serious crisis that has a major impact on Greece, of course, but also on the rest of euro zone countries.

It is time to be very balanced and to think positively. It is also time to be very clear, in one direction or the other.

Major crisis are complex matters, difficult to decide upon, but at the same time they call for clarity. People want to know the direction things will take.

Politics is about opting. And in the case of a grave situation is also about making sure that whatever is decided is the most reasonable approach, among a choice of options that are all rather painful. 

One very last chance?

Greece was told tonight three things: one, they have to come up with a detailed and implementable financial reform programme; two, the European Commission has already prepared a contingency plan in case Greece leaves the euro zone; and third, their new policy reform proposal has to be ready for a careful analysis by the Euro group by Thursday, in view of the EU extraordinary summit called for Sunday, 12 July.

All in all, this sounds like the final leg of a very confusing process. A deadline.

The major risk, besides the one related to missing the deadline, is related to a possible split within the EU. Some countries might go one way and others adopt a different direction. That has to be avoided at any cost.

As we have to prevent any decision that takes flexibility beyond the reasonable enactment of the rules. The rules are essential for the survival of the union.

On Greece´s next steps

We should congratulate Alexis Tsipras this evening. The Greek voters have shown they unmistakably support him and his approach to country´s debt issue.

Now Tsipras has to come up with a clear negotiating position. It has to be on the Euro group tables by tomorrow. There is urgency. And it is also very urgent to show that there is a way forward.

The proposal has to come from the Greek side. And be ready for a decision to be taken on Tuesday evening, when the Euro group leaders meet in Brussels.

These are indeed extraordinary times. They call for very clear commitments and well defined boundaries. Indecision and vagueness are key risks to avoid. As one has to avoid to be trapped by personal likes and dislikes. We might not like the other side, but we have to sit with him and talk in a very frank and constructive way. 

Greece: Fast running towards the abyss

The Greek crisis is now getting to the breaking point. Businesses are just closing their doors as they have little or no access to financial resources. Payments to external suppliers are becoming almost impossible. Domestic payments are just paper payments, no real cash is moving around.

Four days without an operational banking system has a major impact on the economy in a developed country.

And I do not see the banks being able to re-open on Tuesday, as the government wants us to believe. People have lost most of their confidence in the financial institutions and are desperate to take out of the system whatever little money they still have in their accounts.

We are running fast against the wall.

And we do not seem to be aware of it.

We just take the days as normal days in a country that can no longer afford to run as usual. The government needs to take exceptional measures. And I do not see the current leadership being able to do it. For whatever reason, they seem to believe that everything will be much easier after the referendum. Or, the referendum is three days away in a country that needs decisions now. 

Clarifying the relationship with Greece´s political establishment

Political uncertainty is not a good option. The role of leadership is to make it as short as possible. Leaders clarify and define the rules. We expect them to sort things out without too much delay. We also expect them to be able to properly and openly communicate about their decisions.

That´s what is happening in the case of Greece, I want to believe.

We are now in the process of clarifying the relationship with the Greek government. We should also be able to clear up the rapport with the rest of the country´s political class. The connection with them has been too ambiguous. They have to tell us how far they are prepared to go. We should then state if we can go along or not. They have the right to decide about their own future. And we have the same right to choose if we are part of that journey or not.

Both sides have to be wise, in addition to being clear. But above all, both sides have to be sincere and be perceived as such. 

Greece´s way to hell

The end is close, preach those Christian fanatics that come to our doors, the Bible in their hands and the announcement of doom in their mouths. They are just in a mission to try to save us.

I thought of them today as I read the news about Greece. The end is close, the players seem to be saying. In this case, we know what they mean. But opposite of the preachers ‘approach, in the case of Greece many seem to be just waiting for it to happen. It is a bit as if different sides to this fate of gloom and doom would be relieved the day it happens.

The only problem is that once you reach the other side, hell can indeed be very bad. 

The finance moralist is a failed politician

Jeroen Dijsselbloem might not know where Bangui is located. Most likely, he had also no idea up to recently where Nicosia is. But like the Séléka rebels in the Central African Republic, he managed today to create chaos and uncertainty. His interview with Reuters and the Financial Times shows that he has the same level of political tact and experience as the leaders of Séléka. And he managed to do what the CAR rebels are very good at: to divide what should be united. They split the country along ethnic lines, a tradition in that part of the world. Djisselbloem split Europe, separating the good people of the parsimonious North from the prodigal boys from the South. And undermining bank recovery in the lands of such bad boys.

Then, later in the day, maybe after a serious caning by Angela, the man said that his words about the Cyprus programme being a template for future financial crisis were not meant to mean what they indeed mean, as each country situation is a special case.

He is the one that could be considered a special case.

Maybe the UN – at a time when its presence in Bangui is being seriously challenged –should consider sending him as an envoy to CAR. The country is at least a safe place for the markets as there is no Reuters or Financial Times correspondent around. 

The cluster bomb

The EU decision on Cyprus has had the same effect as a cluster bomb. It has hurt the little credit and confidence that the European citizens still placed on the Union’s leaders. It has hurt Germany’s relations with the South of Europe a lot more. It has hurt further the trust on the banking system. It destroyed value in the all the stock markets. It undermined potential capital investments in Portugal, Spain, Greece and Italy. And it has shown, now that there seems to be some backtracking, that the EU takes critical decisions without looking at all the dimensions and implications of the matters under review. And so on.

A very effective cluster idiocy indeed.

Jeroen Dijsselbloem’s name will remain associated to this inept decision. Besides being the Finance Minister of the Netherlands, he is the President of the Eurogroup, the platform that brings together the EU Finance Ministers. Dijsselbloem took over from Jean-Claude Juncker in January 2013. Juncker, notwithstanding the fact that he comes from a very small country –Luxembourg – managed to demonstrate a strong sense of independence and objectivity. He was his own man and also a firm believer in the common project. The new fellow seems to be biased towards Northern European positions, very close to Angela Merkel’s views and be inspired by a moralistic approach to the issue of public deficits. He believes that the citizens in the crisis countries should be punished for the many years of incautious spending. This is exactly the kind of approach that can make the on-going EU cohesion crisis much worse.