Draghi's report: Schacht in green sauce
What follows is my English translation of a short article originally in Italian, first published on Movisol.org on 19th September 2024 and then on ComeDonChisciotte.org two days after, on 21st September 2024. (All emphasis mine).
Former investment banker, central banker and Italian Prime Minister Mario Draghi delivered the report on the “Future of European Competitiveness”, commissioned by the failed, but reappointed, EU Commission chief von der Leyen. The most astonishing thing about the report is that it was commissioned by the man who got every prediction wrong and is responsible, along with von der Leyen, for plunging Europe into a war with Russia and an accelerating economic collapse; remember that according to Draghi, sanctions would have brought Russia to its knees, while they have brought Europe to its knees. Nevertheless, Draghi based his new report on the same studies he used for those wrong predictions.
As for the content, which anticipates the policy of the von der Leyen 2 Commission, it is a “Green” financial bailout, rearmament and deindustrialisation project to be financed with a minimum of 750-800 billion [Euros] per year through common EU debt issues. The plan would be the envy of Hitler's central banker, Hjalmar Schacht, who financed the rearmament of Nazi Germany by issuing “derivative” debt. In order to simplify the governance of such a programme, Draghi proposes to abolish the current voting system, abandoning unanimity and introducing majority voting (https://commission.europa.eu/topics/strengthening-european-competitiveness/eu-competitiveness-looking-ahead_en).
The complete hypocrisy of the Draghi-EU plan is revealed by the fact that Mario [Draghi] complains about the loss of productivity due to high energy costs, as “Europe has suddenly lost its most important energy supplier, Russia”, when it was he, Draghi, who pushed for sanctions and the disengagement from Russian gas. As a result, EU member states import LNG from the US, at prices four times higher than Russian pipeline gas.
While he correctly states that “if the EU maintained its average rate of productivity growth since 2015, it would be enough to keep GDP constant until 2050”, the proposed solution, decarbonisation and rearmament, will further collapse productivity.
A key aspect of Draghi's plan is the elimination of the role of traditional banks. “The EU relies too heavily on bank financing, which is less suitable for financing innovative projects and is subject to various constraints”, reads the report, which calls for a massive issuance of EU debt securities to be marketed in the Capital Market Union (CMU). “It is indisputable that the issuance of a common safe bond would make the CMU much easier to implement and more comprehensive... the EU should move towards the regular issuance of common safe bonds to enable joint investment projects between member states and to contribute to the integration of capital markets”.
“While Europe needs to move forward with the Capital Markets Union, the private sector will not be able to take the lion's share of investment financing without public sector support”. This means more cuts and taxes at national level.
The good news is that the European Commission might implode before Draghi's green-cheating scheme is implemented. The composition of the new Commission was delayed because the green-progressive governments opposed the Italian candidature for a “heavyweight” Commissioner for the internal market. In the end, Raffaele Fitto was appointed executive vice-president, but with another portfolio, that for cohesion. Internal conflicts exploded when on 16 September, Thierry Breton resigned as Commissioner for the internal market, digital and defence, accusing von der Leyen of mismanagement. Breton, who in the previous Commission exposed himself beyond measure for a “war economy”, was perhaps hoping to win the new post of EU “Minister of Defence”, which he strongly advocated. Breton is also the author of the anti-free speech legislation called the “Digital Services Act” and went too far when he threatened Elon Musk with banning X on the eve of Musk's interview with Trump.
The internal rifts were also evident on 13 September, when only seven out of twenty finance ministers showed up at the informal Ecofin meeting in Budapest, due to the boycott against the Hungarian rotating presidency decreed by Brussels. Those present took the opportunity to discuss aid to poor countries, the only strategy to prevent or reduce illegal immigration.
P.S.: Unfortunately I will not be able to write new articles for the next week or so, due to work commitments. However, I might be able to write some short notes or, at least, restack a few interesting articles from other sources. See you soon!