First I'd like to quote the President of the European Parliament, Martin Schulz, who made a short defence of European parliamentary democracy before Barroso took the floor:
"Today the world is looking at Europe not least the Karlsruhe Constitutional Court, we have reached a decisive moment. Recent developments in the European Union have been of great concern. We have seen a deparliamentarisation of Europe. Those who think that parliamentary democracy is too slow or raises too many obstacles are arguing in the wrong direction. No decisions in Europe can be reached without the involvement of the European Parliament. The European Parliament is the Parliament for the whole of the European Union. More Europe with less parliamentary democracy is impossible."I agree. So I'll also look at the responses of the leaders of the political groups.
(Picture from the Commission's Facebook page).
The speech turned out to be a strange hybrid: while the focus was on the future of the EU economically and politically, the structure and style of the traditional legislative programme speech was painfully evident in places. The economic leg of the speech had more policy and was quite legislative, while the political leg was more rhetorical.
On the Eurozone crisis, Barroso complained that the disunity of the Member States after European Council summits, with leaders calling for further measures afterwards, fed doubt into the markets and public and is undermining the efforts made so far to overcome the crisis (as if people aren't capable of making that judgment for themselves). He called for the strong Member States to commit to helping the weaker ones and for the weaker ones to make the necessary reforms.
On the economy, Barroso announced that the Commission would introduce a Single Market Act II to help open up the single market and improve competitiveness (in fact I think "competitiveness" was mentioned much more than democracy in this speech). The first Single Market Act hasn't been fully passed or implemented yet, so I don't know what the second one will do (or if it's simply a repackaging of the first one). There was also talk of a new industrial policy, with Barroso calling for coordination on an attractive tax environment for industry. That there was no mention of common taxes or tax bases indicates that Barroso's thinking of softer cooperation between Member States. Barroso also said that the Commission would pursue a more active trade policy and that the Commission wanted a mandate to negotiate saving tax agreements with third countries to reduce the impact of tax havens.
Banking and fiscal union was a big issue. Barroso made the case for European and coordinated supervision (with national regulators) for all banks, and committed the Commission to pursuing a financial transaction tax through enhanced cooperation (so that it will only apply to willing Member States). Fiscal union will mean greater coordination of national fiscal policies, but Barroso did not spell out any vision for how this might work or how far it would need to go for the Eurozone to work. He also strongly rejected the creation of new institutions alongside the Commission, Council and Parliament or separating out parts of these institutions for Eurozone purposes.
The Commission will present a blueprint for deepening economic union - including treaty changes - this autumn. Barroso also urged MEPs and Member States to back the next EU budget, which he called a growth budget.
On political union and reform, Barroso said that Europe cannot "use the political tools of the past to tackle the problems of the future". The European Parliament should have a strong role, and the Commission will introduce a new statute for the Europarties to strengthen them so they can better offer alternatives in the elections. Barroso also called for Europarties to present candidates for the President of the European Commission at the European elections in 2014. Greater cooperation between the European and national parliaments was also called for, but what this would mean wasn't elaborated on. Barroso defended the independence of the ECB and urged others to respect and defend it.
Barroso called for an intergovernmental conference to decide on treaty change, and a "federation of nation states". This choice of words was picked up on by some MEPs as a way of saying "federation" but meaning continuing on with more of the same.
Foreign policy got some time as well - mostly that Europe needs to act more together in order for the Member States to be heard in a world with the US and China at the helm.
It was a much better state of the union speech than last year for vision, but it had a lot of problems as a speech. Barroso's stronger points where when he could reference legislation because he could tie ideas closer to a sense of direction. That's not to say that vision speeches have to be dotted with legislative proposals, but the speech needed to do a better job of making the case for a certain type of union rather than the more generalised pro-European rhetoric that we got. The debate over what a "federation of nation states" and what that means will probably dominate any comment on the speech because it's so qualified and vague in practice, and in fact that there is little else to grasp on to. Barroso was far more passionate and convincing in his reply to the MEPs' questions and debate - he should have brought that Barroso to the speech.
Political Group Leaders
Daul (European People's Party):
Daul gave a rambling speech, which he admitted wasn't prepared but it would have been better if he had. It was generally supportive of Barroso (who was the EPP candidate for the Commission presidency in 2009), but was the worst speech from a group leader. One thing I got from this was that the EPP supports the ECB buying of bonds (this may contrast with the ECR if you're on the right and distrust central banks taking that kind of action).
In the end I did much better with my Buzzword Bingo for Daul's speech than Barroso's - not a good sign!
Swoboda (Socialists and Democrats Group):
Swoboda said that his group would only support the next EU budget if it was serious about delivering growth, and heavily criticised the EU Troika for their policies in the bailed-out countries for contributing to the recession. He signalled that the S&D Group would be willing to support the saving tax agreements, but there needed to be much more focus on investment. Swoboda pointed out that the US, China and Japan are all putting more into investment at a time when Europe is following austerity.
Swoboda called for a social compact to combat the erosion of solidarity in Europe. Hopefully we'll get to hear more on what this means - Swoboda said his group was agreed on it, so we should get to see the S&D (or the Europarty PES that sits as part of the group) proposing some detail. Maybe something for the PES Congress at the end of the month?
Verhofstadt (Alliance of Liberals and Democrats for Europe):
Verhofstadt focused on Barroso's "federation of nation states" remark, and said it represents the same approach rather than something new. He criticised Barroso for not taking more initiative without Council approval, particularly since the Commission tends to act more on Council ideas than those from the Parliament. Verhofstadt called for a federation of the citizens, and said that federal solutions are necessary - and that the ECB's bond-buying policy will only buy 5-6 months. He said that there needs to be resolution for the banks, a debt redemption fund and a European treasury.
Interestingly, Verhofstadt said that the independence of the ECB meant less democracy and seemed to argue for greater parliamentary control (if I understood his argument correctly).
Cohn-Bendit (European Greens/European Free Alliance):
Cohn-Bendit pointed out that the environment wasn't mentioned in Barroso's speech, but focused on social welfare. Cohn-Bendit said that the US federal budget had expanded to protect social welfare, and that the EU budget would need to expand to at least 5% of GDP in order for it to have the fiscal firepower to do anything to support social welfare across Europe. He argued that there should be more own resources rather than Member State contributions to the budget in order to achieve this, and that there would be financial support for Greece and its social system in the form of a social fund, with more time given to it to reform and pay back the debt.
Callanan (European Conservatives and Reformists):
Callanan opened by borrowing a line from Mitt Romney, saying that he wished that Barroso succeeded (as the ECR supported his election as Commission President), but that he had gone too far down the road of knee-jerk calls for more Europe, instead of focusing on reducing regulation (which he said Barroso had had some success in, but not enough). (He seems to be a big fan of Romney). For the Eurozone, Callanan said that the only way for it to work was for there to be transfers from the stronger countries, which was impossible, or for some countries to leave the Euro, and he advocated Greece leaving the Euro. (I wonder if Cameron supports this line).
He criticised the ECB's bond-buying policy, and said that there needed to be an economic solution to the crisis through less regulation. In response to a question he said that he didn't support quotas to bring about more gender equality in the boardroom.
Callanan also referred to our Buzzword Bingo and the chat on Twitter in his second speech, making him the first MEP to reference it in the chamber!
Farage (Europe of Freedom and Democracy):
Farage started by remarking it is the 20th anniversary of Britain leaving the European Exchange Rate Mechanism. He said that he was wrong in his speech last year that Greece would leave the Euro within a year, but that was because he underestimated how fanatical Barroso and European leaders would be to save it.
Zimmer (United Left Alliance/Nordic Green-Left):
Zimmer attacked the crisis policies for not solving the problem and for weakening European democracy.
Verhofstadt, Cohn-Bendit and Callanan were the strongest performers, taking the opportunity to get their visions and ideological points across. Swoboda was good too, and it's interesting that he kept referring to things that his group had agreed on, but without any detail it lost impact - hopefully there are a few interesting ideas being saved for the PES Congress at the end of the month. Daul, Farage and Zimmer were the dullest. Farage normally manages to inject some personality into his speeches, but it just fell a bit flat, whereas Daul was unfocused and rambling and Zimmer was, well, just dull and didn't make any impact.