Boozing, bullying and now tainted by a tax scandal. So should this EU buffoon govern us?
WHAT a typical, hypocritcal, stinking Euro-shambles. Leaked documents indicate that Luxembourg has been offering secretive deals to mega-corporations which allow them to pay almost no tax.
Some 28,000 pages have come to light and what they show is ugly. Luxembourg, for all its notional commitment to international norms on tax disclosure and transparency, seems to have allowed multinationals special clandestine deals.
Over the years, Luxembourg, as a tax haven, has offered global giants such as Vodafone and GlaxoSmith- Kline the opportunity to escape tax by channelling their billions through the Grand Duchy’s companies.
Not surprisingly, the French, Dutch and German governments are furious. As they see it, Luxembourg has been luring investment away from their jurisdictions by doing things in private which it was not prepared to admit in public.
The European Commission, too, is riled, and has announced an investigation.
There is just one catch. The man who leads the European Commission, JeanClaude Juncker, was, it seems, responsible for Luxembourg’s dodgy tax regime. He served as prime minister for 17 years and was simultaneously finance minister for much of that time.
Rejected
Like so many European Commissioners before him, Juncker was given the Brussels job after being rejected by his domestic electorate. The European Commission has this unusual distinction of being not so much undemocratic as anti- democratic, in the sense that people generally get appointed only after rejection by their voters.
Neil Kinnock (who lost two consecutive general elections for Labour) and Chris Patten (who, despite being Tory chairman in 1992, lost his own parliamentary seat) are two supreme examples.
It would, of course, be absurd to have President Juncker investigate former Prime Minister Juncker. The Luxembourger has therefore announced an independent inquiry, and it would be wrong to anticipate its findings.
Still, the critics can hardly be blamed for asking very embarrassing questions. This, after all, is the man who, at the height of the financial crisis in the Eurozone, blithely insisted that bailouts were not needed. Everyone knew they were coming, but he kept denying them, supposedly to reassure the markets.
He was also the man who cheerfully explained that ‘when it gets serious, you have to lie’. Well, Mr Juncker, it’s looking pretty serious now.
Just weeks after taking office, the new Commission has been badly weakened. Bloomberg, the world’s leading financial news service, has called for Juncker to stand down — and plenty of Brussels officials and politicians privately agree.
The Grand Duchy won its status as an attractive corporate tax haven thanks to its position at the heart of Europe, having been a founder member of the European Economic Community in 1957.
Despite his homeland’s questionable reputation, Brussels politicians — almost to a man and woman — recently voted Juncker into office. Of the 28 member countries, only two, the UK and Hungary, stood apart from the fawning crowd.
Inevitably, the big blocs of Euro-integrationist MEPs, the Socialists, Liberals and Christian Democrats, were quick to endorse him.
Yet, few of them did so with enthusiasm. It was almost impossible to find anyone with a good word for Juncker at the time. He was, Brussels insiders mournfully told each other, fond of a drink and rude, abrupt and abrasive, with a short attention span and a shorter temper.
He had quit as Luxembourg’s prime minister after a huge scandal over the country’s security services’ abuse of their power — allegedly placing illegal wiretaps to monitor leading national figures.
Mr Juncker’s lack of suitability for the top EU job was plain to see, and it is discreditable that so many MEPs and so many national leaders voted for him despite his manifest flaws. I mentioned at the time that you could barely find a single politician or official who was privately prepared to defend him. But, as often happens on these occasions, a collective suspension of disbelief set in.
Why, then, was he appointed? It’s hardly as though it was Luxembourg’s turn. The Grand Duchy has about the same number of inhabitants as Sheffield. It accounts for 0.06 per cent of the EU’s population but has supplied three Commission presidents — the only country to have done so.
In truth, Juncker had just one recommendation to arch-federalists; one that, it seems, cancelled out all the drawbacks.
He was, and is, an extreme advocate of turning Europe into something like a single country. He wants an EU police force and army, a pan-European minimum wage, and a common EU citizenship with voting rights in all national elections.
In the current ‘Europe right or wrong’ atmosphere that dominates Brussels, this is all that counts.
Euro- enthusiasts warmly approved of the way Juncker prioritised the survival of the euro over the prosperity of the people who used it. Even as unemployment reached critical levels in Spain and Greece, he made clear that nothing would be allowed to call into question the ‘irreversibility’ of monetary union.
He took the same undemocratic attitude to political union. When the French and Dutch people threw out the European Constitution in referendums in 2005, Juncker perversely declared that ‘the French and Dutch have not voted No’. To the rest of us, it seemed like some sort of joke, but Euro-federalists roared their approval. And, sure enough, the votes were disregarded and the constitution imposed anyway under a new name.
Nor have his opinions mellowed since then. In his first speech to MEPs following his election in May, Juncker began by praising the father of Euro-federalism, French socialist Jacques Delors, and described the euro as a source of protection in an unstable world. (Not a view shared, I’d have thought, by the 19 million unemployed in the Eurozone.)
He went on to call for fiscal union, a bigger budget and the amalgamation of national foreign policies.
Although few heads of government liked him — they had spent too many summits in his presence — he still attracts widespread support from Euro-federalists.
Not quite so with the public, though. A major poll carried out immediately after his election found that across the EU as a whole, only 8.2 per cent of voters had heard of Juncker.
Disbelief
Still, Eurocrats and politicians suspended their disbelief and pretended that Juncker had secured some sort of democratic mandate.
What makes these new revelations so awkward is that, as a candidate, Juncker campaigned for tax harmonisation. The long-term solution to the euro crisis, he said, was to have a common fiscal policy, leading, ultimately, to taxes being directly levied by Brussels.
The leaked documents, to put this as neutrally as I can, are very hard to square with that official policy.
The fact is that, if true, they are a devastating exposure of Juncker’s hypocrisy: on the one hand, he is a leading advocate of tax harmonisation across the 28 countries of the EU, but on the other, he is an unapologetic central player in a multi-billion-pound tax avoidance scheme based in just one of those countries — his own.
I’m all for tax competition between nations, if it’s transparent. Competition, after all, is what keeps tax rates down. But Juncker appears, like so many Eurocrats before him, to have been saying one thing in public and doing another in private.
Where does all this leave Britain? Well, it was to David Cameron’s credit that he resisted the pressure to endorse Juncker. Some other national leaders may well be feeling a little sheepish now. So, I suspect, are a lot of the MEPs who backed the Juncker Commission.
Still, being right when others have made a mistake is not a comfortable position in this case. Nobody likes a smart-aleck.
Indeed, I’ve noticed, since the euro crisis began, that Britain has become much more unpopular in Brussels. Every new setback for the EU, including this one, somehow ends up being Britain’s fault.
Nonetheless, Juncker’s palpable disqualifications will surely strengthen the hand of his enemies, who want a free-trade rather than political relationship with the EU. Just one look at this tainted individual leads to one inevitable question: Is this really the type of man we want governing us?
Daniel Hannan is a Conservative MeP.