Thread by @lucasguttenberg

1/ In the coming weeks and months when the fate of the Eurozone budget (whatever its final name) will be sealed, there is a huge risk of falling into the trap of trying to above all mitigate the German Angst of transfer union.
Here is why that would be a big mistake:

2/ First, it will never be enough: Transfer union charges can be leveled against every fiscal instrument at the European level as long as countries do not get every single euro back that they pay in. But an instrument that always ensures that makes absolutely no sense.

3/ Second, it’s political: Technical attempts to minimize actual transfers are usually so complex that they are useless as an argument in an actual political debate. At the same time they tend to have a pretty negative impact on the usefulness of an instrument.

4/ Third, context matters. The size of the new budget will be discussed as part of the overall MFF package. In the logic of that debate, it’s already clear that 🇩🇪, 🇳🇱 and others will pay more than they get out.

5/ For all these reasons, proponents of a Eurozone budget should not focus in the coming weeks on avoiding transfers at all costs at the expense of a useful design of the instrument.

6/ Instead, it will be a million times more important in Berlin (and I assume also elsewhere) to be able to convince MPs and the public that this will not be just another structural fund but a new and innovative tool that helps avoiding a repetition of the last crisis.

7/ This will be hard enough, given the sums that are likely to be put on the table. But then it is even more important to focus all energy in this debate now on getting to a design that makes sense economically and can be explained politically.

8/ This is what we tried to sketch out (and were probably still too geeky) with our proposal with @Ole_Funke, @hemker_h and @SanderTordoir - transfers almost certainly included.

delorsinstitut.de/en/all-publica…