 Full house today Wonderful Well, welcome everyone and thank you for joining this joint event between the Financial Times and Brugge on a series of events in which We jointly have a conversation with the Spitzer candidate and for the next the European elections starting in which will be at the end of May and Between now and then we will have six conversations The names are there and we're going to kick start the conversation with Yanis Varoufakis running for DM 25 in Germany and Before we start the conversation, I wanted to share a few housekeeping rules As I said, this is the first of six Then we encourage you to ask questions throughout the conversation here But we would do this through Slido. So if you're interested in asking a question, please log into the the Slido Program, can you change that and brutal the information of how to do that? You just need to code in there ask a question I will be holding the questions here I will try I will do my best to bring the conversations of the most voted in Our dialogue here as you can see Martin cannot do this because he had an accident So I have to I have to do that Martin this time on maybe next next time Okay, and then we will have hopefully the last 20 minutes For Q&A for people from the the floor and we encourage you to ask as many questions to today's candidate Martin Yeah, they will switch it on. Yeah, that's right It's it's a pleasure to be here and for the FT to Share this series of events with Bruegel Before we start today is just just one word about how it is a series So we'll follow a common format For six events six spits and candid up for different political movements all of whom are aspiring To move in at the top floor over there We kick off with with the honest where a focus who probably doesn't need much introduction You all know him but very briefly Long career as an economist an academic economist Then moved into politics and most famously as the finance minister in the series of government in Greece in 2015 And has since then founded or co-founded The democracy in Europe movement to 2025, which is a uniquely transnational political movement Fielding lists in how many European 11 countries for the European elections Mr. Varoufakis is the lead candidate on the German list and also the spits and candid out for commission president after the elections So since this is a Is that better now it's the voice of God Because it's a series for the spits and candid out and and because both Bruegel and the FT are interested in Policy and in particular economic policy as much as the politics We've chosen a format that really tries to get into the issue So we'll have four sections the first is a broad one on sustainable growth and the future of Europe Sustainable in a very broad sense environmental social well They'll move on to three more specific sections topics one about trade policy and the global economy The third will be about the Eurozone and the EU economy and the fourth about competition Competition policy industrial policy Innovation policy so these are all fields you will realize where the Commission actually has some Significant power, which is why it's relevant to ask the spits and candid out and what they want to do in each of those fields In each section, you know send your questions on Slido But in each section will try to stick to questions that relate to that topic and then at the end It can open up a bit when we'll do a Q&A in the in the audience So I'll ask Maria to Kick off. Let's just all welcome Yanis Varoufakis and Maria will kick us off for the first second Thank you Martin and Mr. Varoufakis. Thank you very much for joining us today Therefore their first the kicks off discussion on these issues as Martin said the first question The first theme of our conversation is on the growth agenda and you can we will ask you to shape it in whichever Way you think is appropriate for it. It is a general agenda. It's about how you generate growth In Europe, I just wanted to give you a sense a little bit about how we see the numbers and you can tell us how you want to move this forward and We are in a much better position now in Europe than we were 10 years ago And that's given of course where the size of the shock that we had Possibly the business cycle position is a little bit unfavorable right now But we are in a stronger position more resilient position than we were in 2010 But there is a problem of productivity in Europe and if particularly if you compare that to the US in particular to China You will see that Europe is a productivity laggard and if you want to talk about growth as I'm sure you will You need to have an idea of where productivity will come from in the context of a transformative era with a digital geopolitical Multilateralism all of these issues that will come will have an opportunity to go in a little bit further down the line are Actually debated and there is an uncertainty as to where the new normal is going to lead to In your view where how do you propose and particularly if you were to become the president of your commission How would you set a growth agenda that is going to tackle the lagging of productivity in Europe? To begin with thank you for the invitation Maria, Martin, Broglie I have benefited personally normally from reading the stuff papers that come out of this fine institution for years now Reader of the Financial Times of this is I was too young Yes, not necessarily a good thing, but I like Jacob Riesmog. That's one thing you have in common. I Was trying to be polite And you are beginning to insult me by such analogies Since you mentioned the dreaded gentleman I think that we all here should send a message of solidarity with our friends in the United Kingdom For what it is that they are going through and to always say to them that they will always be part of Europe independently of these dogs Brexit of a process To your question Maria to begin with we have to be honest with each other Yes, things are better than in 2010, but this is not saying much because 2010 was a complete colossal catastrophe We had inflicted a Grave wound upon the European Union European capitalism received a self-inflicted injury in 2008 2009 2010 2011 with catastrophic policies from the European Central Bank and Fiscal policies that made a bad thing worse The fact that we may be better today than we went to 2010 is not something to celebrate Because we're not that much better Let me just point out that we are we entered The upturn of the business cycle much later than the rest of the world than the United States and We exited it much earlier So we wasted one of the cycles of the international capitalist economy Europe is falling behind Both in terms of productivity as you said but also and those are go hand-in-hand in terms of investment investment is spectacularly low especially in comparison with the excess liquidity in the final financial sector and That is a major worry because investment is the key to productivity It is the key to development. It is the key to our capacity as a continent to Meet our Goals for the green transition, which is essential not just for saving the planet But also for decoupling ourselves from dependency from Vladimir Putin from late night from An industrial policy that has been ridiculous regarding the auto industry for instance You know putting all our eggs in the diesel basket at the time when this the industry is dying anyway and should be dead in particular But let me be precise in what our Political vehicle the European spring that is running across Europe that the M25 has put together with all our partners across Europe We launched by the way yesterday at the wonderful Bazaar theater I was wonderful to have all those representatives from Portugal from Finland from From Denmark from Greece from France from Belgium putting forward Answers to questions like yours that are common to all of us Answers that will be the foundation of our common platform and program across Europe This is the beauty of the European Parliament elections. It's a journey not a destination Doesn't matter really what happens in the European Parliament as far as I'm concerned What matters is that we can have this discussion in every country in Europe at the same time With the opportunity of the European Parliament election so Let me put it very simply. We need five percent of GDP Eurozone GDP to be invested every year in good quality green transition related jobs It is essential not just to create good quality jobs because every day in Europe We are destroying good quality jobs and we are replacing them with precarious positions Every day we're missing opportunities to catch up on the front of automation and renewable energy With the Chinese and with even with the United States Every day we're falling behind this way the only way to Answer your question to make up for this shortfall is five percent of Additional net investment in high quality green jobs. Where will the money come from? well We have an idea and I would like to hear Martin's view on this and your view on this It can't come from taxation at least not in the short run We're not against the increase in taxes and harmonizing taxes is all very important But anyone who says that we can have a genuine boost of productivity and green investment out of Increasing taxes in the short run is delusional But we have a magnificent institution in Europe. It's called the European investment Bank. You're all familiar with it It has the capacity to issue Bonds worth five hundred billion every year for five years with the support of the ECB Imagine a press conference where the European Union Council president Mr. Tusk The European investment Bank president and the European Central Bank are presented and they make this announcement that we're going to create a fund For investing into Greek green energy, not Greek green Green transport transition in manufacturing, especially the auto industry and agriculture away from the CAP catastrophic tendency of reproducing problems and Browning our fields and That fund is going to be funded through EIB bonds The ECB will be standing by in the secondary markets ready to purchase them if yield spike above a certain level that we can just define what it is And this will go into a green transition works agency a new agency by the European Union Something similar to the agency that the United States introduced in Paris which then became the OECD in order to channel the funding of Marshall Bay Can I if I may so five percent if I can get into Five five percent this the EIB will do this through levering up or there will be a transfer Yeah, it be bonds Medicines of five hundred billion and the underwriter will be the ECB. No the underwriter The ECB makes an announcement that if yield spike beyond you don't need to call it an underwriter because there's no commitment Just an announcement that announcement will be enough Why is that it would be enough because if you think about it now German pension funds are being crushed by negative interest rates. There is excess liquidity Now soak that liquidity up with EIB bonds the announcement by the ECB will be Enough in order to ensure that those who are now keeping their money Nigga negative interest rates or zero interest interest rates would buy those EIB bonds think about it think about I mean Let's remind ourselves of the fact that there is a shortage a scarcity of safe Assets in Europe I mean if it need to be the ECB if they're spread by the spike up of whatever reason But the announcement will make sure that they will not need to do it if they should be remains credible, of course And by the way this well, yes, they see be will remain credible. I have no doubt about that This is one of the points of agreement between Mario Draghi and me now Look the the simple point is that what I just Related to you proposed already happens the AI be issues bonds the ECB since March 2015 has been purchasing AI be bonds Always say is use this alliance which already exists and which is completely legal within the rules both of the ECB and the European Union Treaties in order to soak up the liquidity and fund the productivity growth that you asked me about You've been admirably concrete in answer to a very really broad and vague question You know the future of Europe sustainable growth You've said the main problem is a shortfall of investment and you have a concrete proposal for how to address that huge hugely ramped up EIB program Bond finance green investments, I'd like to ask you two questions really about that one is In what ways do you see the principal difference of this from what already exists? I have in mind the Juncker fund. We already have vehicles for Bond finance investments. Is it the scale? Is it the direction of the investments? Is it that the EIB? Would be the one picking the investments and is that not something to worry about is the EIB capable of a hugely scaled up investment effort and picking the right projects With you haven't mentioned private sector participation in the selection of projects just in the financing So that's one question. How is that? How is it different from what we already have and isn't it dangerous before you come up with Your second one because I'll forget the first question. It's a very important one. Okay. Firstly the younger plan Was a fraud Most of the money in the younger plan was earmarked for something else and it was redeployed Secondly, the new part of it was effectively a kind of insurance Policy for risk takers in the private sector when the problem was never risk a Version by the private sector the problem was that the private sector did not see the business opportunities In order to take these risks on its own the the beauty of you allow me to say of the of this program that we are proposing for of a Partnership between the AIB and the ECB is that it is completely straightforward. It's completely plain vanilla There is no securitization. There are no different tranches like in the younger plan where you've got tranche one tranche two a little bit of The easy a be a little bit of this a little bit from this program Complexity we should have learned that lesson from 2008. It's not a good guide in the middle of a crisis AIB bonds everybody knows what they are They are credible. They are triple a rated the ECB has been buying them the ECB's credibility You can tell has not been damaged by the fact that it printed 2.7 trillion to buy questionable assets whereas now what we are suggesting is not to buy questionable assets, but to buy genuine EIB Copper-plated bonds the second point in your question, which is very important And I need to clarify that so that there's no confusion Nobody says that the AIB should pick the projects the AIB cannot do that they had don't have the capacity to Increase the portfolio of their projects. This is why we are proposing the creation of a green transitions works agency So the AIB will be funding will be creating the funding basis for the agencies work the purpose of which will be to identify the areas we need a common energy union Somebody has to design that I do believe that the European Union has the capacity to create a green transition works agency That will design this properly if it is funded. So the AIB ECB Collaboration funds it and the new agency Implements it Chosen by a public agency. It's not about subsidizing Market market-based privately chosen But but qualifying investment thing of the Marshall plan the Marshall plan was the greatest boost to private enterprise in the history of Europe It was public money. It was channeled through a Public works age pan European agency in Paris and it benefited created new Private enterprises and boosted existing ones. Why can't we do the same thing? And in a way that saves the planet The couples Europe's energy supply from Russia and creates good quality jobs So if I may because we are running a variety of time on this team But it is an interesting question. I wanted to go about the sustainability part of it Of course, the green component is huge part of your agenda. Give us two more steps You gave us one step, but how would you promote the green agenda ensure that the you goes carbon-free? well Investing in green transition is not enough We need camps on physical growth. I want to see Infinite growth when it comes to education to the health service that fixed Martin's arm so beautifully the other day Caring for elderly people for communities we can have massive growth there digital technologies The arts culture they can grow forever But the amount of carbon dioxide that we emit the amount of cement that we use the amount of fossil fuels that we dig out of Overland of the earth those must be kept and within those limits. We must also Have a taxation policy think of a thing about the Gilles Jaune in France They were Inspired by the increase in the in the diesel tax now. I want to see diesel taxes Okay diesel taxes quadruple But I don't want to see a family in rural France that can't make ends meet have to pay that huge tax When at the same time the switch on television They find out that the tax on the wealth tax for the rich is coming down so we believe in neutral taxation So increased quadruple Boost diesel taxes carbon taxes, but at the same time make it a neutral tax So you return this to the poorer Europeans so they can feel that Europe is working for them It is giving them the opportunity to go green And distribution that's of course I understand that there will be distribution elements there But if I understand you correctly you do foresee an uphaul of the Industry in Europe in order to put the physical caps that you deem necessary in order for you to carbonize Now we'll come back to some of this great business of opportunity for private enterprise to you see there are two ways of maximizing efficiency One is to keep the denominator Constant and try to push the numerator. I hear the other is to keep the numerator constant and reduce the denominator No, well, it's clear. I think we should move to the three now topics Which are specific to the competence of the European Commission and something that we would ask you to give us a view is on First one is trade Martin. Let's talk about trade because trade is perhaps where the European Commission has the most Autonomy or at least independent power to push an agenda. I think and also trade is very important for Europe I think we have a slide coming up that just shows The importance of of trade for Europe, but we've had yes, so this is the this shows This the amount of trade in trillion euros total exports from EU countries if you look at the right That's intra-european trade just to illustrate how the European the collaboration that the European project Has been is very largely an economic trade collaboration the trade inside Europe dwarfs Global trade between the big trading blocks, but even European extra EU trade is as big as China and bigger than the US So just to focus minds on how important this area is now in the last couple of years Certainly after the after brexit the rebrexit referendum and the election of Trump You've seen the Commission trying to double down on a trade liberalization being a trade leader Agenda at the same time. It's been quite willing to retaliate against the protectionism from the Trump administration Both of which have been controversial. We remember the controversy around the CETA agreement There's a lot of nervousness and disagreement about how exactly to react to Trumpian protectionism If there were a Varoufakis Commission, what would his trade agenda be? We are firm believers in the importance of trade and in free trade The problem we have is that in the last 20 years a lot of Issues that have nothing to do really with trade have been Subsumed into the trade agenda. So it's one thing to say we want free trade of goods and services It's quite another to accept the legal or Paralegal processes of TTIP and various other free trade agreements where you have the authority of national parliaments of the European Parliament being usurped by a shadowy private sector-based adjudication program Process whereby whole governments even the European Union can be taken to task by multinational corporations whose patents or Rights in their own conception. This refers to investments in the state So let's separate the two Our administration if we ever have this chance is going to be a great supporter of boosting trade while at the same time having transparency and maintaining a democratic process by which to control the rules of trading the rules of Constraining the ways in which for instance multinational companies will want to introduce chlorinated chicken in Europe or to introduce Genetic engineering that goes against the edicts that we have agreed as citizens. That's point number one You mentioned trade wars. We're very worried about trade wars trade wars are detrimental to the interests of the planet of humanity But look at the way in which Donald Trump has managed to divide Europe and Increasingly to rule over us. I'll just give you an example, which you know very well because I've read them about it also in the financial times Cars Donald Trump threatens to slap a 25 percent tariff on German cars coming into into the United States and suddenly a Division line Emerges in Europe because Angela Merkel in panic mode says to Trump or Indicates to the American as administration. Look, this is terrible. Let's not do that. Let's go to 0% Now 0% sounds good. I am not in favor of tariffs personally speaking, right? But immediately President Macron freaks out because it's the end of Peugeot under all because they face Significant competition from Korean cars Japanese cars something that is not case for so the point I'm making is with one announcement or threat from President Trump you have divisions Deepening and multiplying within Europe. So our trade policy is never going to be successful As long as we are not more united and more integrated in Europe as long as we do not have an Industry policy in Europe which is capable of creating a Commonality of interests in France and in Germany in particular, but of course the rest of Europe Because I think this is something that is a very real A very real threat, right? It could very well be and the probability is non-zero that in two months from now we have Indeed tariffs on cars now. I'm asking you as a future President of the European Commission given the divisions that you just described What would be your recommendation to that given that on the aluminum and on the aluminum? We have actually retaliated in proportion of terms in line with a very clear strategy What would be your recommendations in terms of how to deal with the possibility of tariffs coming from you from the US What I was saying is a partial answer not a complete answer to what you're saying the point I'm making is that yes We need to retaliate. Yes We need to make Donald Trump Understand that he cannot get away with murder, but our capacity to retaliate is undermined by the divisions within us and when you have a French president and a German Chancellor who try to send messages to Trump Independently of the Commission and independently of one another. We are we are allowing Trump to divide and rule over us so we need an Industry policy that creates the commonality of interests and also that coordination between us that will enable us to retaliate because at the moment the Commission is being undermined by the divisions within Europe and the capacity of Donald Trump to divide and rule over us That and I think it's a very important issue, but in the short run you do you do pit and Retaliative tariff so cars that's what you would try to do At the same time well while you try to build Yes, but there's also another dimension. I need to add to do this When it comes to cars We are vulnerable because as Donald Trump so Cleverly said not cleverly correctly said you can not lose a trade war If you have a huge deficit So the whole posture of the Eurozone in particular must be reconsidered in the context of our trade policy To put it simply Martin if you are running a very large Canada cancer plus Effectively you are asking for trouble. You are Entrusting firstly a lot of your capital to foreigners to non-Europeans because you have to export capital if you have a Steady current account surplus that reduces your capacity to then retaliate retaliate against them Secondly because this is always heterogeneous not every country in the European Union has the same kind of account surplus as you know This means that this deepens the divisions amongst us So in other words what I would do is I would ask for a holistic Game plan of how to deal with threats coming from Donald Trump. It's not enough to talk just about tariffs It's not enough just to talk about industry policy. We need to talk about fiscal policy when fiscal policy is Effectively pushing our macroeconomic dynamics into a current account situation It makes us vulnerable when it comes to negotiating with somebody like Donald Trump whose dream Is to make Europe divided and reactionary You've come commission has tried hard to reduce the surplus of countries that have had Sustainable surpluses, but hasn't been very effective. How did they do that? Well, no, they haven't succeeded. No, they haven't even tried Well, there is Yeah, and they have completely and utterly disregarded it in a scandalous way that will always be remembered by Europeans as A major moral failure by the Commission. So how would you do it differently? We wouldn't actually do it. They're not doing it You know, first we agreed on having and I don't understand why an asymmetrical rule when it comes to imbalances So, you know, if you have a deficit of more than four percent Oh, that is terrible But if you have a surplus of more than four percent is fine Up to six percent and then when the deficit goes to eight point five percent I've just mentioned it number, you know at random then we turn a blind eye to this violation So when the rules are being eclectically imposed then effectively what we are signaling to Europeans and to the rest of the world is that Role brutish power has taken the place of democratic process You would put in place sanctions You would use a sanctioned instrument or the monitoring instrument to say this surplus has come back I come from a country that was crashed because it were refusing To reduce a 200 euro a month pension to 120 years. We were crushed for that. I Think I answer your question. No, so you would Yes, you would use a whatever power the commission has down like a ton of bricks on those who bend rules that we all agree should be Respected and I would do exactly the same thing when it comes to xenophobic racist practices by European Union member states That are ridiculing Europe's common values and are making a laughing stock of us in the eyes of Progressive humanists around the world and you think you'd get this through the council Life is not meant to be easy But we're here to try Can I ask one other trade questions? We'll come back to fiscal rules and so on but since we mentioned Brexit What sort of trade relationship would you offer Britain? by the time But at the time the elections probably Britain will have left the EU, but assuming it will have We'll be negotiating a future relationship where trade will be a big part. What will be the relationship you offer on trade Well in the interest of full disclosure our movement fought in Britain and me personally Before the referendum against Brexit No one can accuse me of being a lackey of Brussels as you know This therefore a lot of people's eyebrows were raised when I was going around Britain arguing against Brexit and in favor of a radical remain so that's With this said, let me answer your question. We think that Given the messy process we are in non-process we are in at this moment what we should be garaging all sides of British politics to do is For Britain to stay in the customs union and the single market and all we plus agreement For an indefinite period, which is not doesn't mean that it's Last it has to last forever a small sea conservative process. They vote it Sadly to exit the European Union. We need to respect that there is no time for a second referendum without having European Parliament elections first To ask people in Doncaster, Clacton on sea and leads to vote in a European Parliament election will be incredibly incredibly divisive At the same time, I know deal Brexit Theresa May's a ridiculous deal with Brussels Cannot be fathomed really by a majority of people in Britain or by us at the M25 So as mostly conservative solution would be Firmly Britain is out of the EU. It stays in the single market It states in the customs union and that gives the British people an opportunity to have the People's debate, which is necessary before a second referendum That can then decide in five years time six years time three years time However long it takes for them to have this conversation amongst themselves whether they want to rejoin the EU or to do something else The backstop will remain in place in the background the Irish backstop Well, if they are in the customs union in the single market, we can forget about that silly backstop Even if they end up leaving Later, look, can can you stop Norway from leaving? The after region, but there's no equivalent of the IRA in Norway No, but there is you know a border with Sweden. There is The point I'm making is this there's no way you can convince the people of Britain To accept that they will be held by Brussels into a customs union forever forever is a very long time and You know, I don't even believe that there is any international court that would be able to police such an agreement Even if the British Parliament consented to it. What I think where Brussels is right is When there is a mail draws those silly red lines, she says I want to get out by 2021 I don't want a hard border in in Ireland. I want to end freedom of movement, but I want every part of the cake and eat it Brussels has to say what it says the backstop was important in order to say, well, you're going to leave in two years But at least you need to to guarantee that there will be no hard border because of the IRA because of the don't forget the Protestant Terrorists, huh? It's a two-way process there So I understand why mr. Barnea had to be firm on the backstop But if Britain agrees to staying indefinitely in the customs union and the single market we can move on from there You came quite strong against the current US Administration trade policy vis-a-vis Europe you came out very strong also as a free trader provided. There are issues that are satisfied Do you think that the European antagonism against the US is a way of preserving? They use interest in the global setting and by that I mean the multilateral system engaging with the rest of the world I need to stop in a minute But I mean is the EU strategy Correct to antagonize the US and up to what's at what point? Well, it's all the EU that antagonize the US Yeah, the president elected in the White House that antagonized the every decent human being on this planet including the EU right the question is What do we do about it? Yeah, and we have been Remiss we have been reactive We have been divided We say silly things. I mean I've heard the European Commission talk about the importance of turning the euro into a reserve currency Where you know, I mean that's by in the sky stuff people in the United States Whether they are supporters of Donald Trump or not look at us and they laugh because there is no way you can have a reserve Currency if you don't have a safe asset in Europe a euro bond or some kind of You know piece of paper that people can actually buy if they use your currency as a reserve currency So we say silly things around the world while at the same time Pretending that we are going to fight against Donald Trump. We are undermining our own position Martin, so I move on to the next there or we should move on. I think I think we should move on. Yes We need to go to the euro area reform I'm sure this is a this is a topic that you've thought about and we've touched about it So but but but I would like in the spirit of the conversations that we have in now that we do stick with this idea of what is the Commission and your role as a future commissioner president the role of the Commission is to initiate Legislation and to preserve the treaties. This is this is what your new job description would look like if you were to get there So I think almost immediately upon appointment You will have to go and do the fiscal compact and the MIP process the process that you said it was so ineffective and silly You also talked about not an eclectic use of rule but an enforcement of rule So let's go on the fiscal side and talk about an enforcement of rules I believe you would you will how would you go about and ensure that the Commission that is For many people is starting from a low point in terms of the credibility of enforcing those rules has been selective in a way of enforcing them How would you change that and ensure that we enforce the rules? The Commission has been In an impossible position because when legislators or past commissions or the council Right rules that are violated by life and by the economy and that there is nothing you can do but violate Think about 2009 2010 think of Ireland Not Greece Ireland they were the blue-eyed boys and girls of the European Commission They had a debt to GDP ratio of 25 percent. They had Surpluses in their budget. They were much more order liberal than Germany Okay, and then suddenly the banking system just goes to pieces and Jean-Claude Richet in his infinite wisdom. I don't mean that picks up the phone and threatens the Irish Prime Minister or the ATMs will stop functioning unless there is this cynical transfer of the losses of Banks some of them which were already dead on to the books of the public and suddenly You have a hundred and twenty percent debt to GDP ratio suddenly you have a violation of the rules now This rule could never have been respected because it was written in order to be violated Similarly When it came to for instance, you know when I was in the ministry, I remember There was a moment when I Had to repay the IMF and to pay the European Central Bank and there was no money to do it The European Central Bank was simultaneously reducing the limit the limit that the amount of money that the commercial banks in Greece could invest in Treasury bills of the state while also asking for me as the my Minister of Finance to pay back the ECB for bonds that Trisha had purchased at that point They were violating their own rules with the Proposals that were coming to me with and you know what the proposals were that I should allow the private banks to issue IO use of billions Given in view of the fact that they were bankrupt Yeah, well at the same time asking me as the finance minister to give a guarantee to the those So the finance minister of a bankrupt state was meant to be Underwriting the IO use of bankrupt banks so that we can then take those IO use and give it to the ECB to give us liquidity to give it back to the ECB now What can the European Commission do what can Mario Draghi do when you have all these rules and Institutions that are not fit for purpose. So what to answer your question? What do we do? What would I be doing? I would say okay first We need to stabilize the eurozone economy First we need to move away from the silliness of the fiscal compact, which as you know from a macroeconomic point of view To impose on Italy at the time of renewed in recession Additional austerity on the basis of a rule that Macroeconomically can never be defined in any way that does not involve a political decision as to what the structural Surplus is right. This is Can ever be observed it is always going to be politically decided what it is and in other words You are politicizing decisions that are supposed to be technocratic. So What we need is to bring Europe out of this imbalance at the moment as we speak What I would say to the European Parliament to the European Commission to the European Council is this we have countries Where the growth rate is below the average interest rate and we have countries where the growth rate is above? As long as we have that we have imbalances that are increasing and we have centrifugal forces that are tearing us apart And they are the best gift for somebody like Matteo Salvini We need to stop this. This is why we need to integrate the answer to your question with the green new deal with the increase of investment that will allow us to Lesson and to reduce the macroeconomic imbalances. That's the first thing you need to do And the second thing is to have the discussion We never had about how we need to rewrite the rules in a way that we can then Aspire to staying with them because when you have rules that Can never be respected then you have arbitrary power Then you have poor Mario Draghi trying to find way of bending the rules in a way that is politically Sustainable, but he cannot respect his own rules if he tried to respect his own rules Then there would be no eurozone today So this is a deep reform program that involves rewriting treaties and so on and many people will agree with you on it But you still have to as Commission president you would still have to do the day-to-day decision-making So how do you? You have a vision for how things could be made better. You still have to act in the short term So you just take one example from what I understand from what you're saying the budget that Italy proposed last autumn You would not oppose it. Oh Commission would have said this is fine. No, no, no, I'm not taking sides here on the side of Salvini I prefer to die then do that I Do now let me answer this it is important as President of the European Commission To try to respect the rules because otherwise you lose credibility especially in a place called Germany. Yeah But at the same time you have to do it in a way that helps Our social economy doesn't damage it. So let me answer your fantastic question very precisely What would white have done when facing the new government in Italy last year? I would have said to them firstly your tax cuts out They are not growth-oriented The last thing that rich people in Italy were sending their money to Luxembourg and to Frankfurt need is a tax cut So that comes out your program for Removing poverty the they call it basic income. It's not basic income. It's just a Kind of an unemployment benefit. Yes, that goes ahead The problem with Italy is that it lacks investment You cannot fund investment through Taxation because of the fiscal rules and so on so here is a deal we reduce Your deficit beyond below the 2.4 percent you want closer to the fiscal compact rules in order to show Respect for the rules even if we don't like the rules and at the same time We inject investment funding into Italy as well as into other countries through this collaboration between the European Investment Bank Which is outside the fiscal compact process therefore it is completely legal and it is Beneficial not just to Italy but to the rest of Europe. Is that a quick pro-code? They get more they get more investment from the I be if they agree to be sensible when it comes to their own budget So the question was what would you if I wear the present of the European Commission? That is my point. My point is that only one press conference So you don't need really changes or anything like that. That's a beauty of it But this sounds like the old German idea of sort of contracts for reforms just maybe what's like I don't mind contracts. I love contracts. I don't I mind silly contracts You know why what the contract that was imposed upon my country? I'm I'm mined because it was like look We are gay your bankrupt We will pretend you're not bankrupt will give you the largest loan in history And you will shrink your income by 25 percent. That is a stupid contract If so just to understand it very clearly you would be saying We will direct the I be to put more investment into your country if you redesign your budget in ways that we see we Think is more conducive to growth. Why not? Isn't that a good idea? Is it democratic and also it's absolutely democratic because what you're saying is you need investment In any case look, I'm a Greek right? I mean almost Italian So as a Greek and almost Italian, I don't trust the Greek straight state and I certainly By association, I don't trust the Italian state If you come to Greece for instance, right? Look at the Athens metro and look at the bridge connecting the people to the mainland I'm making this point because one was created through Structural funding that went through the Greek government the metro it took ten years longer and cost three times as much And if you look at the bridge magnificent, but very beautiful bridge You know the one that's connecting the Peloponnes to mainland II be on budget on time So I don't see why this is undemocratic especially if we Europeans have Enabled the next European Parliament and the next European Commission through the program of the European spring in team 25 to do precise to that We need to move on actually if I may on there They have a map here with with designed on to show the performance in in Europe in terms of convergence And what you see here is as red or flesh orange are the ones that are underperforming and here is on done on GDP growth And what is green is or is is performed by vis-a-vis the past is performing above its its trend line This is the environment in which as an express and Commission you will have to come in you see Regional actually diverse is not only country divergence So that is of course an interesting dimension For the Commission to think about how to enable regional converges not only country convergence But I want to talk a little bit about the conditions in which if you were to become the president of the commission You have to operate next to that you have the debts. I know the debts are a topic you think about With with great attention not only the fiscal side, but on the private side But in the fact of the matter is that the debts in Europe have got have given Europe a very bad starting point in terms of investments Investment is key in everything you said, but in order to to do investments You need to incur more debts and we are starting from a very disadvantageous position both on the fiscal side So the government across Europe with variations and important variations are very highly indebted But also the private side we have huge debt The agenda for growth and investment needs to happen needs to be implemented under a starting from a position, which is very unfavorable and Given the growth agenda the growth performance that you see here How do you propose to promote to this investment agenda? in in in your next interview as a brilliant point and you're quite right debt and Convergence have to be looked at as symptoms or parts of the same system of equations of the same process What is fundamentally Insightful about this picture is if you think it come to think of it The euro was in the end pointless Because the greatest convergence did not happen within the Eurozone the greatest converges happened between the Successful countries in the Eurozone like Germany and the Netherlands and countries like Poland Hungary and the Czech Republic That is where you have Remarkable convergence now. Why did that happen? Of course had nothing with the currency had to do with the fact there was a lot of for direct investment from German industry and Dutch industries and Austrian industries into Poland Hungary and the Czech Republic whereas Portugal Greece Island, what did we get we get a tsunami of loans Private loans initially mostly but also in the case of Greece Public loans, which it doesn't really matter that much because in Ireland the money went from Frankfurt to from private banks To Anglo-Irish from there to the developers then the thing blew up and went back to the accounts the public accounts Became public debt in Greece it went directly into the Greek state The Greek state gave it to developers to build roads at the exorbitant prices and olympic works and so on right Let me games Facilities in the end we in the end we have a eurozone that has created a Mass a flooding of Loans into the periphery those were Unproductively invested created bubbles they collapsed and that Goes hand-in-hand. You see this is the bridge. You know this very well This is what connects the high levels of private and public debt in the countries that did not manage to converge Unlike Hungary Czech Republic and Poland so this is why I keep insisting right from the beginning that even though we like to Compartmentalize the discussion trade the euro reforms Convergence and debt these are this is one thing we should have a holistic approach to this When money goes from a Frankfurt bank account bank account bank to a Greek bank and then it becomes a Bubble of real estate in Athens or Thessaloniki Right that means no convergence and at some point unsustainable debt so in we need a data structure to begin with when because we have this legacy of unsustainable private and public debts we need a data structure and at the same time we need an industry policy an investment policy that is Pan-European to prevent The new bubbles from forming and bursting and also to help absorb some of the losses and the debts Just follow up on this because your holistic approach in your party program has a lot of radical concrete proposals So one is for this debt restructuring to take place through a refinancing of public debt With long-term low-interest ECB loans That would presumably require huge political intervention possibly treaty change another element is a is a tax on on net current account surpluses and capital exporters in what you call a Political surplus recycling mechanism Which also would be seen certainly in Germany as as a huge scale of of interference and economically punitive of success, but these are the sort of things that you're proposing. I mean, how do you? How do you hope at all to be able to move in that direction? through dialogue and persuasion Certainly not through force And also you do accept kids would take huge list of changes. You see you mentioned the surplus recycling mechanism This is for the long term. This is not something I were proposing for the next five years but it's an idea and you can understand why of a vision of a stable Europe of the future for now What we are proposing is this EIB ECB collaboration that would be very Beneficial to the the Schwabian housewife whose pension fund is being crushed by the excess liquidity that causes the negative interest H is not Draghi Draghi just a messenger So I think that it is possible. I do this because this is why I'm campaigning in Germany as a former Greek finance minister We know we need to break the mold of European politics We need to have transnational politics because we say look this is stop thinking of this as a zero-sum game It's not the Greeks versus the Germans Half of the German population is finding finding today Harder to make ends meet that indeed 10 years ago And this is a scandal for a country labor under four surpluses a trade surplus a federal government surplus corporation surplus and household savings So I believe that if we have a genuine conversation and this is my experience when I'm going around Germany Even you know Christian Democrats and free Democrats we can have this conversation But that conversation has never been had because it has been silenced by the the the lie that are whenever a Non-German voice talks about you Euro reform they want our money They want Germany to pay for things Germany is paying for things My criticism of Germany of the German political class is not that they have not been paying for the rest of Europe My criticism they've been paying too much They've been wasting their money and in the process, you know They are celebrating a trade surplus which is causing them forcing them to entrust their savings with foreigners that they are misusing those savings So in a sense Everybody can get better off if we have this this conversation So to answer your question more directly and not to take too long The first few steps are steps where we can have consensus Later on once we establish this consensus, and then you have trust building Then you can have you know, suddenly we we move beyond the zero-sum game Mentality and we can see that there is a common interest when you say to people We need a European clearing union We need to not so much to tax net experts, but to take a percentage of net experts and To recycle it in your interests too because if you recycle it within Europe, then you will have to rely less on Chinese demand for your cars and for your gadgets Again, this has to happen through persuasion, but we must in order to get there We need to move beyond the politics of discontent and beyond the politics of biblical economics Where you know you point moralistic fingers at one another the Germans are looking at the Greeks of the Italians as lazy Gits the Italians and the Germans respond by saying, you know, I think of what you did in the 1940s We need to move beyond that to have this rational conversation This is why I very much welcome today, and I thank you very much for having this conversation with me Yeah, do you want to put in any questions from yeah? Some of us have been have been already raised go ahead I think we need to start with the last with the last conversation so the last the final Segment before we go into an open Q&A is about this complex of issues under competition policy industrial policy Digital policy which we haven't mentioned yet Innovation policy, but you've touched on some of these things. So let's have a conversation about that Let's start with a very concrete example So we had a clash recently in the Austin Siemens merger question between Commission investors view in particular, but the Commission as a whole as an enforcer of competition policy and a Largely Franco-German view that there's a need for national champions That the argument for national champions have different has different versions. One is we just need to be big We need to have European Googles and so on Another version is we need this to protect ourselves against China And there's an additional worry that we are too squeamish about digital rights data protection And so on to really compete in the new digital economy Let's start with a very specific Austin Siemens case and kind of move out from there If you had been Commission president ruling on that case, what what what view would you have taken? I? would have come out unequivocally in support of vestigar Clear enough so explain why Because I don't don't we need champions because she's right I don't like this boyish language about champions that comes out of soccer and football No, we don't need champions what we do need is companies that compete and in the process of competing They're investing they are creating good quality jobs to create another cartel in Europe is the last thing we need Mr. Macron and Mrs. Merkel should be ashamed of themselves for coming out with such Lazy arguments about the European champion This is not how Google came about, you know It did not come about because politicians in California decided to create a Californian or a Silicon Valley champion it happened organically it grew out of quite healthy competitive the environment that was An ecosystem that came out of Silicon Valley. This is our great failure is that We have a bank concentric investment culture in Europe There are bankers have been remiss in the way that they have been misusing their capacity to create money and they have been giving money to Fellow bankers in the periphery that have been using corrupt practices in order to build bubbles This is the main reason why we don't have we don't have Googles It is not that we're squeamish about digital rules and about privacy laws This is something that should I mean think about it This this is a great advantage that we have that we can carry the population with us and we can constrain Corporations so as to work in the public interest, but to cut a long story short Vestiger was completely right I remember that this European Union began as a cartel of big business our first name was the European communities of coal and steel the whole purpose was to limit competition and to regulate prices With a guaranteed minimum profit rate for large companies. We need to move away from this Maybe this was the only way that the European Union could begin if we continue along those lines cartels are a menace Cartels cannot handle crisis the world economies in a crisis Cartels are precisely the opposite of what we need. We need to move beyond This mentality that we take together our large companies and do we create yet a larger company? That is not subject to competition You're putting consumer welfare at the heart of it and I mean, you know, there's a lot of sympathy for that We're protecting competition policy you has been very successful and you're saying that we are continuing to do that But here's a specific problem. We have an ambition Europe has an ambition to be a global player That's on one side. Then we have American megamos that were Created as a result of the industry policy that you just described and then you have China Which is an emerging economy that you know He wants to share of the pie and follows a very different model a Model that is not for us to decide whether it's a good model or a bad model The fact of the matter is is that this takes away the level playing field So now you have an ambition as a European politician is an a beer consumer to be a global player But you have to compete With a model that is actually taking away the level play field. I understand your blue sky thinking But how do you coincide the two? How do you come true to your ambitions? Preserve the multilateral system and at the same time allow China to come into the Europe under huge subsidies What is the best response for Europe? Well, the best response is not to build cartels Because as we know from economics of 101 monopoly profits come from restricting supply and from restricting The employment of good people doing good things so you allow the Chinese to come in and then built Well, you say listen the Chinese are coming in because there is a dearth of investment in these continents Okay, there isn't why they're coming in through Italy. There isn't why they went to Portugal. There isn't why they are Now in Paris is because we are failing to generate the investment that would give our businesses the opportunity to compete with them Preserving low levels of investment as we are while allowing Existing large companies to get together is going to reduce aggregate investment aggregate investment further It is not this is if you if you want to give presidency and the Chinese Industrial complex a great gift keep doing what we're doing So you're not interested in preserving the ambition of Europe to become a global pair in Europe I'm sorry exactly the opposite. All I'm saying is that to have the ambition to become a global player. We need to boost investment so that our young people can have access to funding take for instance, yeah the European investment fund which is part of the European investment bank it was set up 25 years ago in order to provide venture capital to Ameliorate for the fact that we have a dearth of capital going to startups and in particular Capital going into the funding of startups that want to become bigger. We don't have that funding sure in Europe So we want more of that That is if you really want to be ambitious. This is what you're working towards This is why our plan for investment is an integral part of everything else to allow existing corporations to Consolidate further is to reduce our ambition. It is not going to allow us to get contracts in In the Arab Emirates or in Indonesia or in Singapore that we wouldn't be able to get otherwise We are not going to be able to compete with the German the German with the Chinese railway companies If we do that we will be able to compete if we have a culture of investment in new Technologies we're falling behind Automation we are falling behind all those things why because of investment not because we don't have a sufficiently high concentration ratio in an industry, but So somebody could agree with you on the investment question agree and say yes We need a lot more investment in particular in these innovative industries and yet disagree on industrial policy and in particular industrial structure And what they would say is today The most efficient scale is now global not regional and that's why The lack of scale is why there is no European Google, you know, we use an American search engine We use American created social media The same might be true in some high-tech physical in red like train for example people will say that industrial structure matters because the efficient scale is now global and if we don't have Companies or operations at a global scale We will not be able to compete no matter how much investment there is So why why would somebody saying that be wrong? Well, the reason is I mean, of course, it's a legitimate position But it's one that I disagree with very very strongly because I can't see how you can create Global globally successful companies simply by merging existing companies If you look at the way that the Chinese companies developed, it's not through consolidation It is true investment. It is true specialization. Yeah, one company is here. See got the patent from Kawasaki and Mitui and they built a fantastic train that no one had built before It's not that first day Consolidated by bringing together three or four companies and creating more monopoly power within China It was by going into joint ventures with foreign companies having innovative ideas and taking risks and being funded This is what we need in Europe think of what is happening now this crime against logic in Germany with the merger talks between finance bank Commerce Bank and Deutsche Bank. This is also being portrayed as consolidation to have a global investment bank that competes with JP Morgan rubbish This is not going to create Global competitor to JP Morgan JP Morgan people are looking at this and they are laughing their heads off because all we're doing is we're marrying two zombies the only beneficiaries will be the people who are running them who are going to use the negative goodwill in order to create paper value from which they will profit with bonuses the Customers in Germany are going to suffer because branches will be closed down Bank employees are going to suffer because they are going to be fired and we're not going to have a global player in the international markets So whenever you hear European champions know that there are vested interests in they are working against the interests of Europe Let's push a bit further on this. I suppose you're right But given how Europe versus China have behaved China now has a lead in some sectors Let's talk about 5g because we're idiots. So so what but what do we do? Don't blame the Chinese for this Right. I mean we have affected Fiscal policy and monetary policy for 10 years that has depleted investment in all the competitors of the Chinese So we created a vacuum and the Chinese are feeling it Stop demonizing China. Yeah, let's look at ourselves in the mirror I mean, we are we Greeks have learned one thing in the last 10 years It's important to look at ourselves in the mirror before we blame anyone else Let's do this at the European level But it's a possible result of these errors that it's now too late to keep the Chinese out to put it that way Without blocking them for a while. So let's talk about 5g specifically So people who know more about this than I claim that if European telecoms Were to use Eric's on a Nokia equipment for 5g the technology is one or two years behind you have to use Huawei What's your take on Huawei use it? The eye the idea that they will be spying on us is laughable Do you remember who was it exactly that was tapping? Angela Merkel's communications. It was not the Chinese wasn't it was our great friends from the other side of the Atlantic Well, I know that my phone You know I might as well go on the rooftop and shout things It's broader if it is not the national security issue I think the issue is you have big companies in China that have become a very big through being so is now This is a model. This is a model that China has Pursuit for some interest is not for everything Supported that and this is that this is what I meant by the Plainfield the level playing field now. Is this a model perhaps Europe should follow so is or is that again? We have been following it. What about Alstom? What about even Siemens? It's a private company, but it has relied on the kindness of states of taxpayers all our great companies You know Renault would never have existed if it was not for the French state You know to say to the Chinese. Oh, they are SOE's and you know, it's it's the Chinese communist part behind the Chinese state This notion that there is a distinction between the state and the private sector is delusional in the United States, they have the most powerful strong Effective industry policy in the history of capitalism. It's called the military industrial complex Yeah, Google would not have existed without it. You all know that you don't need me to go through this So to look at the Chinese is how the state is behind so they have the level the Playing field is not never it was never level. It was never level in Europe Except the difference is they've been doing it well, and we've been doing it badly Let's do it well without Consolidating and strengthening the failures that want to present themselves as European champions Is It's a Belt and Road Initiative threat to Europe's geostrategic autonomy No No, it is an opportunity No, we should be we should always be where anyone with power as you know a small L liberal I was taught from a very young age that anybody who has exorbitant power is dangerous And we should be where we should be aware of Chinese rising power We should be aware of American power. We should be aware of our own power You give a large sledgehammer to a small child you end up with a lot of damage There's no doubt about that. But when the Chinese come and say we want to invest Let's look at what they are proposing. You know when they were coming to me when I was in the finance ministry And they said we want the Port of Piraeus and I want this okay Let's sit down and when you sit down with them, I find this is my personal experience They're very very reasonable people if you are prepared to be fun with them But to say we're not talking to the Chinese when we have a global economy where Germany would Just collapse in it in a heap today without China How can we dare say oh we we need to stop and block the Chinese when we depend on them without China There would be no capitalism today in 2008. There were two forces that kept capitalism alive The Fed and China So all this discussion parcels today about how to stop the Chinese and the lever playing field It just goes to show we are children. We are not adults yet We have to grow up and start looking at the world the way it is Just the time I think we should open up. Yeah You want to bring anything up? Hands to see who you might like to ask a question and while I look at the hands I'll be very clear that we would like questions not speeches because we're very little time and Many people want to talk and so on so I'm going to take a couple of questions And if they're not questions, I will cut you off Thank you Natasha run it you from the committee of the regions. It's very interesting Everything here, but I have three questions. The first is You get one because all this will have questions to I would like to hear your views on the European Minister of Economy and Finance Do you agree with this or not? The second question is do you think that the Eurozone needs a separate budget? Okay, good. Well, we'll take two questions because we won't have time to thank you anybody else Maybe anyone in the back the gentlemen here Please here in front here, I think we need a but thanks for being so concise Good morning, Jorge Valero with your active very good questions. Will it be this proposal for a AIB ECB? Instrument your token or your demand to support any PP candidate in the European Parliament to become president of the European Commission Okay, so the question is whether I mean Let's say that Optimism is a new debate at the end. You don't win the European elections and you don't become president of the European Commission Will it be the proposal for the AIB is last ECB instruments to finance investment investment Your demand to support an EPP candidate Good question. So does the eurozone need an economics and finance minister? What about the eurozone budget and it was a eurozone budget, right? Yeah, and Would you would you trade support for a Commission president in return for support for these ideas about AIB and ECB back to AIB bonds? That's okay No, we are not in favor of a finance minister And we're not in favor of a finance minister because you can't really seriously have a finance minister without the finance ministry And you cannot have a finance ministry without the capacity to tax and a capacity to borrow and to have that capacity to Borrow you need to have a federal democracy To be legitimate. I'm all in favor of having a federal democracy But if we start having this conversation now people will say, yeah, right will be dead before that happens So let's start with things we need to do using existing institutions to stabilize the eurozone and then start the process of debating in Town halls in regions in cities in Brussels in the longer term As to what kind of democratic governance we want to see in the European Union in the next 10 years What kind of European democratic Constitution we want and whether we want that Constitution to include the checks and balances that would enable a European budget a eurozone budget and the European finance minister on the second question the answer is yes We don't care who is sitting in that seat. What we care about is policies We want policies that make sense and they can that can make a difference to go ahead So anybody that agrees with or we you can agree we can have a compromise, of course on things we consider to be a way forward for Europe things that would bring us closer together and Things that will stop the centrifugal forces that are tearing us apart and giving rise to political monsters across the continent We will then support whoever Plays along with that So just think you don't at the moment support a eurozone budget. No, I don't How can you have a eurozone budget if you don't I mean look? It sounds good, doesn't it? I am a federalist. I want a federation, but I want a democratic federation I wanted to be legitimate. I want a constitution. I want I don't want I can't read the Lisbon Treaty It was written in order to destroy the soul of those who who read it, okay? I want a constitution that is democratic and which creates You know a federal government that we can all vote for and Whose decisions can be? democratically checked Until that happens. No, there can be no budget for the eurozone. This is why Macron's idea I was dead in the water even before it was launched because you know what what they ended up now with a line in the EU budget Which is macroeconomically in significantly insignificant to have a macroeconomically significant Budget you need democratic legitimacy So while waiting for that, let's have some investment seems to be there that the position Actually from a here This is one perhaps some back to the euro form the ECB has a mandate defined in EU treaty Wouldn't be a democratic for the ECB to decide by itself to change this mandate? Yes, nobody's asking for the ECB to change this mandate cannot change this mandate We have to change this mandate, but every proposal you heard from me and every proposal in our european spring pro Process program is completely holy within the letter of the law not necessarily the spirit of the law But you know that's okay When for instance we propose a debtor structure based on any any idea that initially came from this fine institution the red and the blue debts When we are proposing that the II the ECB Intervened so it becomes a go-between member states and investors using issuing ECB bonds in order to Provide this loan conversion to reduce the interest payments in the long term for the Blue part of the debt the permissible part of the debt There's nothing in the ECB charter that prohibits that the main reason is because they hadn't thought of it when they were writing it But at least we would not be violating the charter of the ECB and we would be having a therapeutic debtor structure without any losers What about the prohibition on a credit line to governments? It wouldn't be a credit line It would just be bought up it could be You know you issue a bond like the central bank of Chile that does You give to give it to a German or a Chinese investor from that you finance You service you don't purchase you service part of the Italian bond that matures and then you have the Italian government pay that to the Pay for pay the German that all the Chinese Investor at the end of the maturity of the ECB bond This is More legal more within the rules of the existing charter than what Mr. Draghi has been doing in the last three years. This is where I have to agree with yes, yes vitamin Let's take a few more questions. There's questions here from the floor in there Why do you say in the common policy agriculture policies, but You said at the beginning the common agricultural policy is bad. Why what do you do as? Commission president with these common They only come on policy in Europe. What did you do? Thank you, my name is Todd Buell. I'm a reporter with law 360 What do you think of the Commission's proposal to try to get rid of unanimity on tax rules, you know to Make me go to qualified majority voting. I'll keep the question brief Yeah, you've mentioned you've talked a lot about kind of democratic accountability, do you think that the The president of the European Council should be elected by Europeans to ensure that Europe is more than just an economic Toolbox and actually the social aspects are brought out much further All right, thank you very good questions all of them. I'll start from the last one I'm a federalist and a Democrat. I do believe I would like to live in a Europe that has a federal government Which is democratically controlled by a federal parliament, huh? United States of Europe, but we can't have this conversation now because of the centrifugal forces that are pulling us apart so To have that to have the European Commission being elected by the peoples of Europe you have to have a constitution Now that will take a long time first. We need to stabilize Europe We need to stop the centrifugal force who had to defeat Brexit or Brexit like moves We need to defeat the fascists that are rising up throughout Europe and who we do unfortunately very well in May So we need to do that. We have our work cut out for us as European Democrats before we can begin to have this conversation on your question I We need first to stabilize before we can start building we need a solid foundation that we're lacking The on on your question. I agree I think we need to have harmonization and we should move away from veto power and Qualified majority voting is a good way of moving towards it I would even go even more in the direction of majority voting Corporate tax and and VAT and then we can talk about carbon taxes as well and then And I'll come to that but also I wanted to add in throwing inheritance tax because it's the only sensible wealth tax there is but anyway, this is I Would and it is part of our program Common agricultural policy you right well it is it is good that we have a common agricultural policy It's terrible that we have this common agricultural policy because now we are paying people to not produce and we are paying in Indiscriminately and independently of the quality and the greenness of The methods that are being used now You know I was in Crete which is where my family originally comes from recently and I was a pole to find that All the stock of local seeds has been depleted because of by here Monsanto Cretan civilization for 5000 years. I said a variety of different, you know genetic Genetically unique Plants and vegetables and so on now that's its goal gone And this is because of the way that the common agricultural policy has misdirected funding You've been so wonderfully concise. So there's a lady there The gentleman here I'm talking about the questioners And the lady here can have her third question if she still wants it Hello positive money Europe and Have a question regarding the European Central Bank more than once you stated that we need a more transparent and accountable Okay, okay, and which are your concrete proposals concerning that so transparency and accountability of the European Central Bank Thank you. Yeah, Javier dot from Spain. Mr. Bartofakis if you Could change one thing of your political activity as great finance minister. What would what would do change? Thank you coming from the committee of the regions I would like to ask you as a next commission president Would you take the task force for subsidiarity one step further? Thank you. Thanks Gregory from Bruggan So the AAB plan seems to be really like the silver bullet in your in your proposal But the thing is that the decision at the AAB are taken by the board of governor Which are basically the finance ministers of the EU How do you convince them to adopt your plan because the president of the Commission or the Commission cannot do anything To direct a B investment Excellent questions. I'll start from the personal one. You asked me. What would I have done differently? Well, lots of things, but if you ask me to say one I say I would not sign the interim agreement I would should not have signed the interim agreement with the Eurogroup on the 24th of February 2015 the reason being that Unfortunately my colleagues we had a good agreement four days before To replace the MOU with a list of reformers that we would write from scratch We went through that we put it together and then they introduced the MOU through the back door again And at that point I should have said no, I'm not signing since you asked I'm tempted to say other things, but I want On the question of the European investment bank starting from that last one Well, let me let me just tell you a story brief one. Don't worry when I was Finance minister was of course a governor of the AAB and I put forward this proposal And I was astonished by the fact that no one disagreed Some didn't have an opinion to say but Verne Hoyer and others said this is a great idea We have to pursue it, but but this is not something that we can decide on our own We need the green light from the council This is why we need politics to legitimize the AAB from doing that the AAB cannot make this decision on its own It needs a green light But I can assure you that the European investment bank people firstly have the capacity to do it and secondly They would be very open to the idea of doing it and they would very some of them would be very keen to do it Including finance ministers because it would give them a lot of degrees of freedom in their own home countries Because you see we have the we labor under this illusion that there is a tug-of-war a zero-sum game between sovereignty Are there in our capitals in our nation states and sovereign in Brussels at the moment? We have a weak EU and we have weak Parliaments and governments They it's not a zero-sum game if we have this investment program across Europe that gives more degrees of freedom To the national capitals to our nation states on the question of regions This is a central plank in the European Springs and DMs program. I think that it's high time that the centrality of national governments should be sidestepped should Should be pushed aside It is important for municipalities for regions to have direct link with Brussels It should be possible for Brussels to fund regions directly On the basis of business plans that make sense Maybe in the context of the green transition works agency. This is something we could do but to have regional developmental plans Remain hostage of national governments and is a major loss of opportunity for our regions and for our Europe and finally You asked me about transparency the European Central Bank Some of you may know that there was a very interesting story that emerged in 2015 after I After I resigned Somebody called me. I don't know who it was an unknown to tell him a call from within the European Central Bank central bank to inform me that President Mario Draghi of the ECB was so worried before Switching off ELA liquidity to the Greek banks that he didn't trust the legal department within the European Central Bank Which is a very good legal department. I assume it's a very good legal department. It's very expensive and very large and he commissioned a Legal opinion from a private firm He needed a backup Before switching off ELA when we found that out Fabio de Masi a member of European Parliament myself Wrote to mr. Draghi and we asked to see the legal opinion if it was legal what you did Show us the legal opinion. It was purchased on the you know using European funds Maybe European citizens should be able to look at it. He said no because of confidentiality, which is a joke, of course, you know Attorney client privilege. Now, that's that's what they live. That's what a lawyer tells you But when you go to the client and say look you paid with my money for this I want to see what the lawyer said to you Confidentially does not hold so we took the matter further. We collected 35,000 signatures Now we are which lost the case of the at the European courts. We are going to move to the European Court of Justice Think about it We have enabled a central bank Which is outside the political process for better or worse? We have enabled to shut down the banking system of a member state of the EU of their eurozone And we don't even have the right as European citizens to find out what the legal opinion on such Acts of exorbitant power was That is not good because such lack of transparency is not consistent with a democratic regime Coming to an end actually, but there is a question here, which is very fitting I think for us closing this And it is about where you see Europe in the next ten years now note It's not about where you want it to be that I think we gave us a flavor But where do you think it's going in the next ten years? It's a political decision of mine To refuse to answer and I'll let you I'll tell you why I will explain why because Because you see It's not like predicting the weather The beauty of natural science is that the weather doesn't give a damn about what we think it will do whatever it will do and then we can use our predictions and The discrepancy between what we predict and the weather in order to test the theory and to improve our Scientific meteorological Processes, but when it comes to politics when it comes to a Europe what we think Determines what we do and what we do shapes the future So we have a moral right to abstain from predictions and to concentrate on doing that which we think is right Thank you all for coming mr. Barakis. Thank you very much for kickstarting the discussion I wish you best of luck in your electoral campaign join us in the next event next week and again Thank you very much for joining us. Thank you