French Sortie on European Recovery Bonds—for Green Fascism?

April 17, 2020 (EIRNS)—Both French President Emmanuel Macron and his Finance Minister Bruno Le Maire came out in favor of a market instrument for “recovery” in the European Union, in interviews with the London Financial Times and with EU correspondents of leading European dailies, including Greece’s Kathimerini, respectively. Macron warned that if EU countries do not launch a rescue fund that can issue joint debt to cope with the economic fallout from the coronavirus pandemic, populists in countries like Italy, Spain, and perhaps France will take power. “We are at a moment of truth, which is to decide whether the European Union is a political project or just a market project. I think it’s a political project.... We need financial transfers and solidarity, if only so that Europe holds on,” Macron said.

But Macron then said that if the unthinkable can be done to economies to slow a pandemic, it can be done to arrest climate change (sic). “People have come to understand that no one hesitates to make very profound, brutal choices when it’s a matter of saving lives. It’s the same for climate risk,” he blathered.

His Finance Minister Le Maire said a Recovery Fund means “to raise common debt” with a definitive end-date, and geared toward investment. The Recovery Fund could be a special-purpose vehicle or carried out through the European Commission and given to EU member-states, he said.

But this Recovery Fund is simply a honey-trap to get the European Stability Mechanism (ESM) approved, Italian Member of the European Parliament Antonio Maria Rinaldi told EIR today. Rinaldi’s party, the Lega Nord, has voted against the activation of the ESM. Notably, the Italian government coalition has split on the the ESM, with the Five Stars (M5S) voting with the Lega and Fratelli d’Italia (FdI) opposition parties.

Eurobonds, or Recovery bonds, are part of a package that includes the activation of the ESM, Rinaldi explained. Furthermore, they will have a “senior” rating, automatically downgrading the rest of the debtors’ sovereign debt. And last but not least, the ESM, once approved in the reformed version, will officially become a bank bailout fund.