It was May 2012 and the newly-elected President François Hollande was attending his first European Union summit. Speaking to journalists he defended the broad outline of his growth pact and acknowledged disagreements with German Chancellor Angela Merkel. In particular, he noted, they differed on the idea of Eurobonds, a way of spreading the load of European debt to relieve the pressure on those states under attack from the markets. The French head of state had made this one of his priorities.
Hollande went further. He did not rule out revisiting the way European meetings were conducted, judging them “too long”, and offered some veiled criticism for certain long-winded heads of state who “take half the night” to outline their positions. At the time the president was intervening to fight against the exclusively austerity-led approach of the German chancellor, and was trying to “reshape” Europe as he had pledged to do during his election campaign. He indeed succeeded in eclipsing Angela Merkel. He wanted to believe that the policy lines could change in Brussels..
Fast forward seven months to last week and François Hollande was once more in the Belgium capital, attending his fifth European summit. But during his press conference it was as if he had completely adopted the rules of the German game. He barely mentioned Eurobonds. “We mustn't have fetishes. We cannot envisage them in the short term,” say his advisers, abruptly.
It is the same story with the plan for the eurozone to have its own budget which was originally supported by the French president and yet which was barely mentioned in the meeting's final outcome. To justify his stance François Hollande resorted to platitudes and noted in the almost impenetrable language typical of the Brussels world: “I prefer to say 'solidarity mechanism' and 'funds dedicated to contracts' rather than “fiscal capacity [ editor's note, EU jargon for a separate EU budget]”.
The socialist president even concluded events by putting back the “political debate” on Europe until 2014, after the European elections and most particularly after the Italian elections in the spring of 2013 and the German federal elections in the autumn of next year. “After 2014 there will be a political debate on just where we are prepared to go,” said Hollande. “The issues will be Eurobonds, the solidarity mechanism that can be strengthened...” Between now and then, in other words, the EU will not be producing any great reform other than putting in place a part of the planned banking union.
The summit, which ended last Friday, was however supposed to have sealed the future of economic and monetary union and prepared a great “leap of federalism” for the EU. In the end it simply led to the putting in place of “contracts for competition and growth” some time in the future. Meanwhile the members of the eurozone committed themselves - via a contract with the EU Commission - to carry out detailed structural reforms. This was a German demand and suggests that it is Chancellor Merkel who continues to dictate the European agenda.
“We can sense the trap. We don't want countries to be obliged to sign these contracts with a gun to their head,” said a member of the French summit delegation before the gathering. His concerns were well-founded. Once again this was a measure designed to “reassure the Germans” even though François Hollande swore that the last European treaty - the European Treaty on Stability, Coordination and Governance (TSCG) painfully adopted in the autumn, would be the final concession to the strict budgetary control so dear to Berlin. From the German point of view these “contracts” go even further.
On this issue the French president ended up choosing the same defensive strategy as in June when the Council of Ministers agreed the Compact for Growth and Jobs demanded by the French president ; namely not to attempt dramatic change but instead to try to get a better balance in a framework not of his choosing. This was in the name of the “spirit of compromise” so beloved of Europe, Hollande explained. “We fell very short in relation to the great discussions about the future of European economic and monetary union,” admits one of the president’s advisers. “It all lacks vision. We barely discussed the future of the Union.” This has been a recurring problem since the election of François Hollande, who struggles to define his European project with precision.
'The problem is that we have no doctrine'
Back in September a senior French adviser to the presidency told Mediapart: “We had a very poor [election] campaign and [policy] positions and strategy were not fixed in a wide number of areas. That's the case with Europe. We have no vision past the TSCG [the Fiscal Compact]. Meanwhile a senior member of President Hollande's office told one visitor to the Elysée: “The problem is that we have no doctrine.”
Seen in this context, the November EU summit devoted to the European budget was quite revealing. For it held up to question the sincerity of the president’s own European plans. At the summit the French president intervened to defend the budget for the EU's Common Agricultural Policy (CAP) . By way of compromise he proposed cuts in the sections designed to reinforce competitiveness in the EU. In other words, precisely those policies that should launch the long-awaited economic recovery. This is a clear case of double speak..
Above all, November's summit confirmed the French president’s relative isolation. It was François Hollande himself who chose to cut short the negotiations, on the second day of that meeting and which led to its failure, in the face of a London-Berlin axis supported by a majority of members states.
The socialist president has to deal with a Europe that leans to the right. Seven months after President Hollande's election he remains one of the very few left-wing leaders at the negotiating table. He can only really count on Denmark and Slovakia as being in his camp. Belgium and Austria are both led by socialists but in the context of centrist coalitions, which restricts their room for manoeuvre in negotiations.
Hollande's strategy of making an alliance with southern Europe has only partially worked. The Italian premier Mario Monti and the Spanish prime minister Mariano Rajoy are certainly open to the French desire to reshape Europe. But they remain conservatives who give unfailing support for the structural reforms advocated by Chancellor Merkel. Moreover they are both in weak positions in their own countries. The former has just tendered his resignation while the latter is already largely discredited, scarcely a year after he came to power.
Meanwhile the French president's attempts to get closer to Poland, symbolised by his visit to Warsaw in November, has not been enough for some. “François Hollande completed agreements in June with Italy and Spain, fine. But since? He has to travel more in Europe,” says green European Member of Parliament Yannick Jadot.
Hollande himself says he is happy with what has been achieved so far. “If I'd been told in May that we could have moved so quickly, I'd have been the first to be surprised!” he said at the end of last week's summit. As proof of this he cites the growth package agreed in June, the tax on financial transactions backed by eleven member states, the decision by the European Central Bank to buy debt from Eurozone member states under attack from the markets , the agreement over Greece and an accord on the supervision of banks.
In reality everything has happened as if the window of opportunity for the reshaping of Europe promised by President Hollande was in the process of closing, ahead of the looming German elections. Unless, that is, the financial crisis comes back worse than ever. The European indicators remain depressed, with +0.1% growth expected in the eurozone next year and an unemployment rate of more than 11%. Spain and Greece, where the delicate matter of recapitalising the banking sector has been awaited for months, are far from being out of trouble. Should matters take a turn for the worse, François Hollande could then return to the European scene with his campaign message: that too much austerity kills growth.
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English version: Michael Streeter