EU budget, Jeffrey Sachs, Barnier, UK-DE friendship, sanctions blockade
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Ursula von der Leyen’s €2 trillion budget power grab has gone down like a bucket of cold sick across Europe. French farmers will soon be out on the streets enraged about roughly 30% cuts to agricultural subsidies, Germany and the Netherlands flat out rejected the increase in spending, while Poland is bracing for cuts to cohesion policy. MEPs are seething at the prospect of being cut out of the management of the funds, and Europe’s regional authorities are fuming. The real question is why von der Leyen believed she could get away with proposing a nearly 70% increase to the last budget at a time of economic stagnation and strained coffers across the bloc. Von der Leyen has refocused the EU’s core spending on places where it is currently lacking: a big bang €451 billion competitiveness fund would boost start-ups and ramp up cleantech, €100 billion would be given to Kyiv and hundreds of billions more funnelled into military mobility, stifling migration and conducting foreign policy. Those may be worthy priorities in isolation, but what von der Leyen sketched out looked more like a fantasy bucket list-cum-naked power grab than a serious proposal. The Commission president is often praised for her adroit political acumen, but yesterday she clearly lost the plot, my colleague Jacob Wulff Wold argues. The budget backlash was well underway before the ink dried on Friedrich Merz’s printed copy of the proposal. A German government spokesman immediately said the budget increase was "unacceptable”. Berlin also hates plans for EU taxes on large companies. The French government is already cracking up over a national austerity budget. Public Accounts Minister Amélie de Montchalin’s spin – that France has achieved a reduction in its contribution to Brussels – tells you everything you need to know about how von der Leyen's €2 trillion EU budget is going down there: Paris is already having to do the hard sell for this budget, under pressure from the far right. "That there are reactions to the proposal is understandable,” von der Leyen said, before defending it as “more modern, more agile, more time-appropriate”. That depends what time zone you’re in. What was supposed to be a triumph before Brussels heads south for the summer will be remembered as a communications train wreck. Von der Leyen stood in front of a PowerPoint presentation that added up to 101%, not 100% – a telltale sign that her staff had abandoned the seven P's. The budget commissioner was trapped in the Parliament when he was meant to be answering journalists’ questions and presenting his own budget. A spokesperson announced she was going on holiday in the midst of it all. And the presentations relied on slideshows and speeches – not legislative texts. The whole thing was hours and hours delayed. It will be another two years before we get a final decision on the budget. But the verdict on von der Leyen’s handling of what is arguably her most important duty is already in.
| | | | Clock is ticking for Barnier | Things are heating up in Paris, where Michel Barnier had hoped for a smooth path back into national politics, Elisa Braun writes. The former Brexit negotiator and ex-PM announced his bid for a parliamentary seat, positioning himself as a unifying figure between conservatives from Les Républicains and Macron’s centrist camp. But the race is quickly turning contentious: according to Le Parisien, two sitting ministers – one from each of those very blocs – have now entered the contest: conservative Rachida Datiand centrist Clara Chappaz. What was meant to be a low-stakes by-election is fast becoming a high-profile test of Macron’s ability to hold his fractured coalition together. | | | | |
UK, German friendship | German Chancellor Friedrich Merz and UK Prime Minister Keir Starmer are due to sign a historic friendship treaty today, as Euractiv first reported. The first of its kind, the document is part of Starmer’s post-Brexit reset of relations with EU countries and completes a triangle of friendship treaties between Berlin, Paris, and London – also known as the E3. The treaty will place a heavy focus on security cooperation and will contain a mutual assistance clause, a German government source said. But it goes much further, including parts on migration, youth exchanges, and the economy, even if consequential measures had to be left to a larger EU treaty – a concern of the French, who warily eyed the negotiations. Overall, it’s a reinforcement of the trend to lean on an elite class of subgroups of influential countries rather than the unwieldy EU-27 to chart the course for Europe – which some find concerning. On Wednesday evening, there was still haggling over the treaty’s name, however. The signing is expected to take place at “a prestigious London museum with strong Anglo-German connections”, according to an official briefed on the matter.
| | | | Russian apologist in the plenary | American professor Jeffrey Sachs, most recently spotted lecturing pro-Russian YouTuber-MEP Fidias, will be addressing the European Economic and Social Committee’s plenary session by video at 12:15pm today. He has an advisory role on a report the EU institution is cooking up. Sachs already paid a visit to the European Parliament in February on an invite from Michael von der Schulenburg, one of Sarah Wagenknecht’s Brussels lieutenants. The controversial American professor has made a name for himself in recent years, blaming Russia’s full-scale invasion into Ukraine on NATO expansion and American imperialism. Sachs, who was previously an unpaid adviser to Josep Borrell, pushed the conspiracy theory that coronavirus originated from the US. "Advisers are selected by rapporteurs and do not speak on behalf of the institution. Their role is advisory and does not imply any form of institutional endorsement,” an EESC spokesperson said. | | | | |
BERLIN Germany’s coalition has caused confusion over its stance on the global minimum tax of 15% for large corporations, backed by 140 countries. German Chancellor Friedrich Merz had suggested that Germany may be suspending the tax, arguing that it had “no future” due to America’s recent withdrawal. But Finance Minister Klingbeil said on Wednesday that the coalition would continue to back it as established by the coalition agreement, following a call with Merz. PARIS France secured a €1.6 billion cut to its 2026 EU budget contribution, easing pressure on PM Bayrou’s austerity drive – and blunting a key demand of Marine Le Pen’s far-right party. Read more. ROME Giorgia Meloni’s government hits 1,000 days in office – an Italian rarity – amid sliding approval ratings and growing public fatigue. Yet her Brothers of Italy party still leads the polls. Read more. MADRID Spain deepened ties with Mauritania, its “key partner” on migration and regional security, as PM Sánchez leads a high-level visit to Nouakchott aimed at curbing departures and boosting investment. Read more. WARSAW Lublin Triangle ministers reaffirm unity, back Ukraine’s future. The foreign ministers of Ukraine, Lithuania, and Poland met in Lublin to mark the 5th anniversary of the Lublin Triangle initiative. In a joint declaration, they reaffirmed support for Ukraine’s EU and NATO membership bids, regional security, and military cooperation. The ministers condemned Russia’s aggression, called for tougher sanctions, and pledged continued aid, reconstruction support, and accountability for war crimes and forced deportations. PRAGUE Slovakia’s arrest of a Ukrainian behind 2024 school bomb threats has enraged Prague: Czech intelligence says the suspect was bankrolled by Russia, a detail Bratislava omitted, exposing rifts in Czech-Slovak security cooperation and prompting calls for accountability. Read more. | | | | |
Cheat sheet: Everything you need to know about the EU budget battle, as the proposed €2 trillion budget for 2028-2034 faces significant opposition, with key issues including cuts to agricultural funds, disagreements over reform-linked funding, and resistance from member states like Hungary and the Netherlands. The Commission expects over €20 billion in revenue from the tobacco tax, with €15 billion coming from the revised excise tax, which will help fund the next EU budget, though the proposal faces opposition from Italy, Greece, and Romania. Europe’s alphabet soup – E3, E4, G5 – reflects the rise of super groups. Germany is set to sign its first-ever bilateral friendship treaty with the UK, completing the triangle of friendship treaties with France and the UK, known as the E3. While the treaty aims to strengthen ties, it also highlights Europe’s growing reliance on flexible, mini-lateral groupings to bypass EU blockages. | | | | |
Informal meeting of research ministers in Copenhagen Von der Leyen visits Iceland; meets Prime Minister Kristrun Frostadottir Press conference by Commissioners Šuica, Kos and Síkela on the Global Europe MFF proposal Commissioner Fitto presents the MFF proposal in the REGI committee Economic and Social Committee holds its plenary session EESC President Oliver Röpke chairs an Enlargement Forum, joined by ministers Maida Gorčević, Montenegro’s Minister for European Affairs, Orhan Murtezani from North Macedonia, and other representatives from EU candidate countries. Commissioner Roswall attends 20th African Ministerial Conference on Environment in Nairobi Commissioner Dombrovskis attends G20 Finance Ministers and Central Bankers meeting in South Africa | | | |
Antoine Kasel, former head of cabinet to Nicolas Schmit, returns as director for labour mobility and international affairs. CLARIFICATION: The Dutch position at Tuesday's foreign affairs council was that they would have preferred more decisive action on Israel, but that pressure on Bibi Netanyahu's government should come as a bloc. | | | | |
| Newsletter Editor Eddy Wax |
| | | | Politics Reporter Nicoletta Ionta |
| | | Contributors: Alexandra Brzozowski, Magnus Lund Nielsen, Elisa Braun, Thomas Møller-Nielsen, Nikolaus J. Kurmayer, Jacob Wulff Wold, Nick Alipour, Martina Monti Laurent Geslin, Alessia Peretti, Inés Fernández-Pontes, Aleksandra Krzysztoszek, Natália Silenská, Aneta Zachová. Editors: Matthew Karnitschnig, Sofia Mandilara, Charles Szumski. | | | |