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The "SarMerMonti" Triangle

Published on , , Sofia

When Mario Monti took over the new technocratic government in Italy in mid-November 2011 I thought that this is a good Brusselsian move to install in a country of systemic importance (rescuing Italy from default would have been impossible with the available tools in the eurozone) a former servant of its, quiet and conciliatory person, especially to replace the crotchety, self-loving and frequently violating the rules Silvio Berlusconi. In the short period from the formation of his technocratic government however, my vision of Mr Monti sharply changed and some time around the 100 days of his rule I started perceiving him as the third pillar in EU governance, also known lately as the abbreviation "Merkozy" (Merkel + Sarkozy). And after Monti's appearance in the European Parliament on Wednesday I can confidently say that we will be more and more often talking about not just the "Merkozy" tandem but about the "Sarmermonti" triangle (Sarkozy + Merkel + Monti).

The role of the former EU commissioner

Mario Monti has a rich Brusselsian CV as he was twice a commissioner - firstly in Jacques Santer's Commission where he was responsible for tax policy and customs union, and then in the Commission of his fellow countryman Romano Prodi, where he was a Commissioner of Competition. Monti's name reappeared on Brussels's stage in 2010 when the Commission chief, Jose Manuel Barroso, assigned professor Monti the task to write a report about the situation of the single market. This report contains a very good analysis, which is still valid today.

It is this analysis, a combination of the Brusselsian point of view and the situation of his home Italy, that is the foundation of the good, although still unconvincing results of the Italian economy. Moreover, as will become clear below, Monti succeeds in combining in his governance precisely what the EU since January 30th has been trying to apply at EU level - to make a whole of the austerity measures and those that promote growth and jobs.

But you will probably ask what is Monti's role in the "Sarmermonti" triangle? The "Merkozy" tandem has been needing for quite some time a positive example in order to continue prescribing its cure - austere budget discipline, without any compromises and, if possible, following Germany's example. An approach that has won not a few enemies to Chancellor Angela Merkel in Europe and not less for French President Nicolas Sarkozy, although his are predominantly inside the country where presidential elections are upcoming and the socialists of Francois Hollande are already arming for radical retreats from the "Merkozy" agreements. The two leaders' approach irritated to such an extent the exhausted by savings and lack of activity economies of the most troubled countries, Greece in particular, that they started to depict Ms Merkel as a nazi.

This is why they need that positive role model that can be used by the tandem to tell the others "Look Monti's Italy! So, it's possible!" For now this approach is working quite well. It can be said that the roles are distributed in the triangle the following way: Monti is responsible for growth and employment policies, the chancellor for budget discipline and Sarkozy for the political union.

It seems that Mario Monti fits quite well in his role because recently in an interview with The Wall Street Journal he revealed a plan of his, proposed at European level, for transferring greater powers to the European Commission to enable it to sanction counties that do not open their economies for competition. We can only imagine how this would be met by the Freedom Party of Geert Wilders, the Dutch politician, who has recently launched a hotline to collect complaints against Central and Eastern Europeans for "stealing" Dutch jobs. According to Mr Monti, whilst the EU is introducing strict measures to sanction violations of budgetary discipline there is no effective mechanism to immediately punish countries that keep their economies closed.

The proposal, which has still not been published, will facilitate the Commission to impose decisions instead of waiting for the member states to sue each other in the European Court of Justice, as is currently the case, according to the European legislation. In his interview for the American financial daily Monti asks himself: "What does this have to do with growth?" and answers to himself: "A lot, because if you give more teeth to the Commission to remove national obstacles to the functioning of the single market, we'll create a large level playing field, which the business community always insists is a key component of growth".

In fact Monti's role as a face of the European triangle started to be clearly visible when the usual meetings between Sarkozy and Merkel before an important European Council (the summits of leaders of the member states) enlarged to include Monti. The Italian PM, for example, participated in many meetings before the first for this year Council on January 30, as except "Merkozy" he met also David Cameron, the British PM, and Herman Van Rompuy, the president of the European Council.

The request to Monti on behalf of Merkel became clear during the meeting between the two in Berlin, again before the Council on January 30, when the German chancellor announced that the big economies in the EU and especially in the euro area had to work together very closely. It is no accident that precisely on the eve of this meeting in a number of interviews the Italian premier was making it clear that he expected a praise from Chancellor Merkel for the efforts and sacrifices of the Italian people, which she did. This Mr Monti rewarded by saying: "This means that Germany can rely on Italy, together with France and Germany, to contribute to a Europe of stability and development".

A Monti for Greece, please!

The emanation of Monti's coronation as part of the "Merkozy" tandem was on Wednesday, February 15, in the European Parliament. The Italian prime minister appeared before the MEPs upon their invitation, but his appearance looked more like a hearing of a candidate for a high European position rather than just a discussion. It is important to note that the house was full and the event was attended by two representatives of the Commission - Mr Michel Barnier, EU Commissioner of Internal Market and Mr Maros Sefcovic, who is responsible for the institutional affairs. Monti spoke with conviction, without reading from a prepared speech, making a huge jesture to the European Parliament by mentioning several key for the institution phrases: community method, Italy, Greece.

He explained that for him the responsibility for Italy, as an Italian, and that for the EU was equal. He recalled the time when he was a commissioner and said that this was very useful to him now, because when "one works in Brussels as a commissioner he sees how the member states blame the European institutions and then I promised myself that I will never blame the institutions and I will not be unfair to them", Monti said, evoking huge applause. Another key for the MEPs remark was that the significant sacrifices and the complex reforms that had to be undertaken in Italy were not imposed by Brussels. A signal that was directed mainly at Greece, which blames Brussels and some member states for the burden it is carrying right now in order to put its finances back on track. "Those are things that are necessary to improve life in Italy", Monti said.

And as if to disperse any doubts that he is not an equal partner in the "Sarmermonti" triangle, the Italian MP said that Italy was not just going to follow the guidelines of Brussels but would be a motor in articulating these guidelines. "This is why I accepted with great pleasure Merkel's and Sarkozy's invitation to work in close cooperation with them. The contribution Italy wants to deliver is a focus on the community approach". These words again evoked applause and happy smiles on the MEPs' faces - finally a leader of the EU had listened to them and knew what they expected! He further enhanced the effect saying that the euro was the most courageous project of the European construction. "The crisis in the eurozone created too many stereotypes, it divided too much the Europeans, created division lines between the countries in the centre and those in the periphery. We have to remove these lines".

Monti dispersed possible doubts that he could be just a pair of tongs in "Merkozy"'s hands by criticising the two leaders for allowing a collapse of confidence in the euro area when they violated the Stability and Growth Pact for the first time. "I don't want to cast a shadow over them but indeed the credibility of the budget was undermined. These countries, let us not forget, were the foundation of budget discipline but it had to apply not just in the centre but in the periphery too. We have to prove that budget discipline is important to us in the future too".

He touched upon another issue, painful for many MEPs and for many countries - the famous "golden rule" of Germany, enshrined in the fiscal compact that is expected to be signed on March 1. "Yes, there must be golden rules, there must be and even in the German economic policy it is deemed that indebtedness is possible but to a certain extent, meaning that this debt should not exceed what the available capital can cover". Again applause.

For a finale Monti announced that Europe was facing a huge challenge - to continue on the path of integration, while in the same time strengthening democracy - again a very sensitive issue for the European Parliament, where only a few hours before heated debates took place on the occasion of Greece and one of the most frequently mentioned words was precisely democracy and its infringement because of the crisis. Monti's speech was welcomed with standing ovation. After that every speaker (those were only the leaders of political groups) turned to him in Italian and started with the words: "Dear Monti, dear Mario Monti".

The leader of the biggest group, Joseph Daul (EPP, France), said directly: "You know that I am a supporter of the Franco-German motor but I think that other countries as well have to offer positions and even counter-positions and counter-proposals. This is why I welcome that you support the community approach. You know that a return to the intergovernmental method would be a setback. A step back for 500 million Europeans. This is why I am thanking you for all the efforts you made. Our parliament wants to hear the voice of an open, integrated, political, responsible Europe. We are with you and in your face we see an ally, please do see an ally in our face too", concluded emotionally Mr Daul who is usually quite restrained.

The leader of the group of the Progressive Alliance of Socialists and Democrats (PASD), Hannes Swoboda (Austria), played with a lapsus Mr Monti made earlier saying he was elected to the European Commission when he was a commissioner (the commissioners are not being elected, they are proposed by the member states). The Austrian MEP reminded that he was not elected but after today's [Feb 15] speech "we would elect you". He encouraged him, when his mandate as prime minister of Italy ended, to return to Brussels. Hannes Swoboda, however, was quick to trade his support for an Italian shoulder for the introduction of a financial transactions tax. He again complained from the representatives of the troika (EC, ECB and the IMF), who take part in the negotiations of the rescue programme of troubled countries, but said that in Italy the right approach was undertaken. "We have to rely on a strong Italy, on a democratic Italy", he concluded.

Guy Verhofstadt, leader of the ALDE group and former prime minister himself (of Belgium), also did not spare praise saying his group was glad that precisely Monti was selected to lead the government of Italy. "You do excellent job because only in a few weeks you returned Italy on the right path and you undertake large scale structural reforms. We have a real federalist!", the Belgian MEP exclaimed and underlined that Greece was not Italy and Greece had to very carefully observe what was going on in Italy. Moreover, Guy Verhofstadt rhetorically asked whether Monti could be sent to Greece, after finishing his job in Italy.

The co-president of the Greens in the European Parliament, Rebecca Harms (Germany), explained that Mario Monti was in fact civilising the manners in Italian politics, probably having in mind Silvio Berlusconi's governance, who was involved in numerous scandals, including a sex scandal with minors. "We should strive for such a civilising of the manners", she appealed.

The representatives of the smaller and more radical political groups recalled, though, some savoury details from the Italian PM's CV, namely that he is among the eminent members of the Bilderberg Group, a former adviser to Goldman Sachs - an investment company considered one of the main culprits for the 2008 global financial crisis. According to Bruno Gollnisch, an independent MEP from France, those circles could not add democratic legitimacy. "You have a limited democratic legitimacy", he said to Monti, referring to Monti's not being elected by Italian voters.

To this the Italian premier responded in French, saying: "But unlike you and some others, I have not participated in elections to receive this legitimacy. I was assigned to do this job. I am confident that if you were asked to interfere in a difficult moment for your country, you would have rejected and would have said that you would take such a position only if you had democratic legitimacy". The other accusations, however, related to his participation In Goldman Sachs, remained unanswered.

Many of the speakers spoke and asked about Greece in the context of the fact that the country was suffering severe austerity and that the approach to it was severe. To this Prime Minister Monti said: "Firmness and severity, which the European states use for Greece at the moment may sometimes seem to us a bit overdone, but please do not forget that for many years - and I say this as a humble observer from outside the country - Greek politics was an example of the worst possible politics". He recalled the nepotism that is deeply rooted in Greece.

His participation in the European Parliament ended again with standing ovation, a lot of congratulations and visible content among the MEPs, who for the first time saw in a representative of the European Council (the member states) such a "community-like" attitude. Later at a news conference Parliament's chief Martin Schulz expressed satisfaction with the fact that he was sitting right next to a premier with whom he could discuss European problems constructively, "as was not always the case".

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