French President Emmanuel Macron and German Chancellor Angela Merkel have agreed a proposed EU budget. As you might expect, I have a question. One of the points of agreement is the purpose of the “single eurozone budget” they want to create:
The EU will set up a single eurozone budget to boost investment and promote economic convergence among all 19 member states.
What does this purpose statement mean, exactly? Who will pay into the budget and in accordance with what parameters? Who will pick the investments to be supported and on what basis? On these two matters, details are yet to be worked out, certainly; it’s early in the process.
But the larger matter is what these two mean by “economic convergence.” Do they seriously intend to move the successful nations—the ones fiscally responsible, that don’t tax heavily or spend profligately, that actively enforce their (tax) laws—toward those nations that are less responsible, even irresponsible, that see their tax laws as suggestions rather than requirements, in addition to seeking to move (with what enforcement mechanisms?) those less responsible, even irresponsible, nations toward the successful ones?
That is, after all, what convergence means: bringing the two sides toward each other, rather than just one side toward the other.
So: why should the successful nations, the fiscally responsible nations, be held back in favor of those nations that have chosen a lower course? Or is that not what Macron and Merkel meant with their convergence plan?