The State of Our Union is Tense

In his first state of the union address, European Commission President José Barroso disappointed parliamentarians but did display vision.

In his first “state of the union” address to the European Parliament on Tuesday, Commission President José Manuel Barroso failed to enthuse lawmakers with a vision that was, at least in part, still bold. Even in Barroso’s own conservative camp there were complaints.

Barroso referred to the global recession early in his speech, noting that the continent’s “interdependence was highlighted and our solidarity […] tested like never before.” The president believed that Europe had withstood the test. “We have provided many of the answers needed,” he said, “on financial assistance to member states facing exceptional circumstances, on economic governance, on financial regulation, on growth and jobs.” What is more, “Europe has shown it will stand up and be counted.”

But there remains much to be done. “There is no room for complacency. Budgetary expansion played its role to counter the decline in economic activity. But it is now time to exit.” Throughout Europe, countries must make severe cutbacks in order to rein in spending and restore balance to their budgets. “Unsustainable budgets make us vulnerable,” Barroso warned. “Debt and deficit lead to boom and bust.”

The Commission President clearly sided with German chancellor Angela Merkel on this issue who has been pushing for tougher budget rules on the European level. Countries in the south of Europe, led by France, Italy and Spain, are not in favor of implementing sanctions for member states that violate Europe’s deficit maximum of 3 percent of GDP. They continue to struggle with a mounting debt burden in the face of mass protests against announced austerity measures.

In France and Italy, trade unions have staged large demonstrations against proposals to rein in welfare spending and raise the retirement age. Barroso urged opponents to consider that, “sound public finances are a means to an end — growth for jobs. Our goal is growth,” he said, “sustainable growth, inclusive growth. This is our overarching priority.”

One way to promote employment is further unlocking the potential of Europe’s common market. No matter high unemployment rates, there are still some four million job vacancies throughout the union, said Barroso. He proposed to initiate a “European Vacancy Monitor” that will “show people where the jobs are in Europe and which skills are needed.” In short, people should be encouraged to work across borders.

Although he pledged to “strengthen citizens’ rights as they move across borders” and opined that “racism and xenophobia have no place in Europe,” Barroso was criticized from the left for not objecting more strongly to France’s recent expulsion of Roma.

This summer, the French government began deporting hundreds of Roma and Gypsies to Romania and Bulgaria, offering them 300 euros as an incentive to leave France voluntarily. Opponents of the expulsions believe that the government is violating the freedom of movement which the Roma, as citizens of the European Union, enjoy. The opposition wonders aloud whether President Nicolas Sarkozy, whose approval ratings have plummeted in recent months, isn’t using the incident for his political gain.

Barroso further spoke of the need to cut red tape and stir innovation to help small- and medium-sized companies prosper. “We have the people,” he professed; “we have the companies. What they both need is an open and modern single market.” Just 8 percent of Europe’s twenty million small businesses engage in cross border trade; still fewer in cross border investment. “The internal market is Europe’s greatest asset,” said Barroso, “and we are not using it enough. We need to deepen it urgently.”

In times of persistent economic malaise in some member states and ever louder calls for protectionism in others, Barroso’s call to greater unity and free-market dynamic across Europe deserves some praise.

Complaints, particularly from the left, focused instead on minutiae, with some demanding a ban on hedge funds and the trading of assorted derivatives and the Green Party urging the commission to invest more time and effort in fighting climate change. The leader of the broad and centrist European People’s Party regretted that Barroso wasn’t more ambitious about expanding the reach of the EU, adding that he should explain to nation states and their taxpayers that their money is “better used by the 27 together than by each member state separately.”

In fact, Barroso did note that “Europe must show it is more than 27 different national solutions. We either swim together, or sink separately,” he added. “Our partners are watching and are expecting us to engage as Europe, not just as 27 individual countries. If we don’t act together, Europe will not be a force in the world, and they will move on without us — without the European Union but also without its member states.”