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Re-elected Barroso faces market challenge

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bozoJose Manuel Barroso promised the European Parliament that as re-elected president of the European Commission he will have more authority to fight for Europe and defend its single market against economic nationalism.

But after five years of toadying to the big member states, he will need to show more spine to enforce state aid and competition rules on Germany, Britain and France in the teeth of strong national financial or commercial interests.

The conservative former Portuguese prime minister, backed by all 27 EU governments, won an impressive absolute majority of EU lawmakers — more than the simple majority he required. That
gives him a stronger hand when facing inevitable pressure from the big boys over the carve-up of key Commission portfolios.

Recent Commission moves to query state aid to banks (such as Dutch guarantees for ING) and scrutinise public funding of auto industry rescues (Germany’s bung for Opel) are encouraging. But it remains to be seen whether Barroso, now he is no longer reliant on them for re-appointment, has the character to stand up to Angela Merkel, Nicolas Sarkozy or Gordon Brown on politically sensitive cases. In his first term, he often appeared to be a trimmer, a multilingual chameleon.

Gifts for all on Barroso’s Christmas tree

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danybozo-epJose Manuel Barroso’s pitch to the European Parliament for a confirmation vote on Wednesday was like a Christmas tree, with gifts for everyone.

Bidding for a second term with a wider majority than his own centre-right political family, Barroso produced last-minute peace offerings for the centrist liberals, the centre-left socialists, the environmentalist greens, women, trade unionists, the French and the scientific community.

Obama playing a weak hand with Iran

The announcement that the major powers, including the United States, are going to open talks with Iran on Oct. 1 ought to be a source of rejoicing. After all, isn’t this what much of the world has been urging for several years, while the European Union conducted a frustrating, low-key dialogue like the warm-up band at a rock concert?

So why is there so little excitement about the United States, Russia, China, Britain, France and Germany sitting down at the table for comprehensive talks with the Islamic Republic?

German Opel aid tests EU rules

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opel-logosThe credibility of the European Union’s single market and state aid rules is at stake over Germany’s selective offer of taxpayers’ money to preserve Opel factories and jobs on its soil.

On the face of things, it looks like an open-and-shut breach of state aid rules. General Motors agreed last week to sell 55 percent of its European arm to a consortium of Magna and Russia’s Sberbank under massive pressure from Berlin.

French PM eyes Barroso’s job?

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fillonIs France trying to stymie Jose Manuel Barroso’s re-election for a second term as European Commission president?

An intriguing story in Le Monde reports that French Prime Minister Francois Fillon (pictured left with Barroso and President Nicolas Sarkozy) is considering offering his services as head of the European Union executive if Barroso fails to win majority support from the European Parliament this month. Le Monde quotes an unidentified French minister and an anonymous senior diplomat, with a comment from Fillon’s office declining to speculate on a Barroso failure and saying that of course, the prime minister is interested in Europe but he hasn’t put himself forward as a candidate.

Barroso’s EU vision lacks levers for change

Could the European Union be among the big losers of the global financial crisis?

Despite signs that recession in Europe may be bottoming out, the 27-nation bloc risks emerging from the turmoil with its economic growth potential stunted, its public finances shackled by mountains of debt, and its international influence weakened.

That is the backdrop to Jose Manuel Barroso’s campaign for a second term as president of the executive European Commission.  In a manifesto sent to EU lawmakers last week, he warns that unless Europeans shape up to the challenge together, ”Europe will become irrelevant”.

Latvia: let the lat go

Do as you would be done by. This excellent rule surely applies as much in monetary affairs as it does in other fields of human endeavour. Those who loudly urge Latvia not to devalue its currency should reflect upon it.

Since Latvia’s monetary crisis started in 2007, a host of non-Latvians — led by the European Commission — have urged the small Baltic state to cleave to its currency board system, which pegs the lat at the wildly uncompetitive rate of 0.702804 to the euro. Regardless of the cost in terms of spending cuts, higher taxes and lower wages, this is supposedly all for the Latvians’ own good.

The European browser elections and other tech news links

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Microsoft says the best way to resolve its dispute with European Union competition regulators may be an election.  The software giant spelled out late on Friday Brussels time plans for an election-style ballot to decide the question of which browser consumers use in Windows.

The forthcoming Windows 7 operating system would offer a “ballot screen” that lets consumers turn off Microsoft’s own Internet Explorer (IE) and instead use rival browsers such as Mozilla Firefox, Apple Safari Google Chrome or Opera Software.

Kroes hits right note on EU bank aid

Neelie Kroes, the EU Competition Commissioner, is right to be taking a hard line on state aid to banks, which will distort competition if not repaid. However, she will have to fight member states like Britain and Germany, which are desperately encouraging banks to lend locally, nursing large losses on their capital injections or trying to avoid massive upheaval in their banking industries.

The reasons for her tough stance — laid out in guidelines she will unveil on Thursday, obtained by Reuters – are sensible. At their heart is the desire to maintain the imperfect European market in financial services that the Commission has done so much to foster. State aid risks distorting this market because of members’ differing ability and willingness to underwrite their banking sectors.

Polish EU vision breaks the mould

At last — a Polish vision of the future of the European Union that does not involve refighting
World War Two or dying in a ditch for outsized voting rights.

In a thoughtful report entitled “Europe can do better”, a group of eminent Poles, including two former foreign ministers and a former central banker, offer a blueprint for Poland to partner EU heavyweight Germany in advancing European integration.  Even if some of the proposals look unrealistic, Berlin would do well to grasp the outstretched hand from Warsaw and explore common ground.

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