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olle
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Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 7:36 am

after 5 days of negoriations a 1.82 T euro 7 year budget is agreed.

https://www.politico.eu/article/eu-lead ... very-fund/
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 8:31 am

Truly amazing landmark agreement indeed!

Not just for the agreed size of the EU budget, nor for the fact that a massive COVID solidarity fund is included, but for the fact that there's now a new financial instrument attached which is a joint debt mechanism

https://www.bloomberg.com/news/articles ... ium-europe

European Union leaders agreed on an unprecedented stimulus package worth 750 billion euros ($860 billion) to pull their economies out of the worst recession in memory and tighten the financial bonds between their 27 nations. The emergency fund will give out 390 billion euros of grants and 360 billion euros of low-interest loans.

Almost a third of the funds are earmarked for fighting climate change and, together with the bloc’s next 1 trillion-euro, seven-year budget, will constitute the biggest green stimulus package in history. All expenditure from the fund must be consistent with the Paris Agreement’s goal of cutting greenhouse gases.
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 9:01 am

Also interesting to note is how the MFF for the next 7 year period is as good as indentical to the current one despite brexit.

That puts to rest the illusion of Brexiteers the departure of the UK would leave the EU with a massive hole in their budget and thus cripple it beyond repair.
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 9:03 am

sabenapilot wrote:
Truly amazing landmark agreement indeed!

Not just for the agreed size of the EU budget, nor for the fact that a massive COVID solidarity fund is included, but for the fact that there's now a new financial instrument attached which is a joint debt mechanism


I don't see how paying more tax or pushing a massive pile of debt onto the next generation is anything to celebrate.
 
Olddog
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 9:30 am

Do you want to compare with US or UK budget ?
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 9:51 am

AeroVega wrote:
sabenapilot wrote:
Truly amazing landmark agreement indeed!

Not just for the agreed size of the EU budget, nor for the fact that a massive COVID solidarity fund is included, but for the fact that there's now a new financial instrument attached which is a joint debt mechanism


I don't see how paying more tax or pushing a massive pile of debt onto the next generation is anything to celebrate.


They idea is keep tax revenue from collapsing and hence, in the end, pay less taxes. And it is essentially all for investments, so future generations will be fine too. Plus, even minor inflation will probably evaporate most of the before 7 years are over.

It is a weird concept, but the EU is surprisingly citizen benefit oriented, just compare the massive pro competition stance of the commission compared to anti-competition subsidies elsewhere.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
JJJ
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 12:04 pm

AeroVega wrote:
sabenapilot wrote:
Truly amazing landmark agreement indeed!

Not just for the agreed size of the EU budget, nor for the fact that a massive COVID solidarity fund is included, but for the fact that there's now a new financial instrument attached which is a joint debt mechanism


I don't see how paying more tax or pushing a massive pile of debt onto the next generation is anything to celebrate.


In the context of a crippling pandemic no one has come with a better solution.
 
Dieuwer
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 7:21 pm

Good to see that Europe - after deliberating for 5 days - have come to a reasonable compromise. Market is clearly happy: Euro up, dollar down.
Europeans have shown to be adults and be able to come together. On the other hand, "Washington" is still the kindergarten as ever with daily mud sling contests.
 
wingman
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 7:48 pm

Dieuwer wrote:
Good to see that Europe - after deliberating for 5 days - have come to a reasonable compromise. Market is clearly happy: Euro up, dollar down.
Europeans have shown to be adults and be able to come together. On the other hand, "Washington" is still the kindergarten as ever with daily mud sling contests.


The US is about to pass a second stimulus. Sure we sling mud but essential business still gets done. And I know for a fact that mud-slinging isn't exclusive to our 50 states. Any number of EU-related threads proves the much. There's one right next to this one!
 
olle
Topic Author
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Re: Eu budget of 1.82 T Euro agreed

Tue Jul 21, 2020 8:13 pm

This is proceeded in Europe.

The EU that has been described having impossible taking decision has done a number of major decisions.

Common dept but combined with demands of economical reforms and legal demands on special eastern Europe that I believe will be critical in the future.
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 4:12 am

olle wrote:
This is proceeded in Europe.

The EU that has been described having impossible taking decision has done a number of major decisions.

Common dept but combined with demands of economical reforms and legal demands on special eastern Europe that I believe will be critical in the future.


Common debt is a bridge that should never have been crossed. From now on, Northern European tax payers will be permanently on the hook for fixing Southern European budget deficits. Until, like Britain, they decide that enough is enough.
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 4:38 am

AeroVega wrote:
olle wrote:
This is proceeded in Europe.

The EU that has been described having impossible taking decision has done a number of major decisions.

Common dept but combined with demands of economical reforms and legal demands on special eastern Europe that I believe will be critical in the future.


Common debt is a bridge that should never have been crossed. From now on, Northern European tax payers will be permanently on the hook for fixing Southern European budget deficits. Until, like Britain, they decide that enough is enough.


Common debt is old, about as old as me, since MTFA & CLM exist for decades.... and Northern European tax payers will not, neither permanently nor temporarily, be on the hook for Southern European Budget deficits. They will only be on the hook for the peanuts in this budget.

Where did you pick up that piece of misinformation?

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 5:53 am

tommy1808 wrote:
AeroVega wrote:
olle wrote:
This is proceeded in Europe.

The EU that has been described having impossible taking decision has done a number of major decisions.

Common dept but combined with demands of economical reforms and legal demands on special eastern Europe that I believe will be critical in the future.


Common debt is a bridge that should never have been crossed. From now on, Northern European tax payers will be permanently on the hook for fixing Southern European budget deficits. Until, like Britain, they decide that enough is enough.


Common debt is old, about as old as me, since MTFA & CLM exist for decades.... and Northern European tax payers will not, neither permanently nor temporarily, be on the hook for Southern European Budget deficits. They will only be on the hook for the peanuts in this budget.

Where did you pick up that piece of misinformation?

best regards
Thomas


You are naive if you think it is going to stop here. This is just the first step towards fiscal union that Southern European want so desperately.
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 6:31 am

AeroVega wrote:
tommy1808 wrote:
AeroVega wrote:

Common debt is a bridge that should never have been crossed. From now on, Northern European tax payers will be permanently on the hook for fixing Southern European budget deficits. Until, like Britain, they decide that enough is enough.


Common debt is old, about as old as me, since MTFA & CLM exist for decades.... and Northern European tax payers will not, neither permanently nor temporarily, be on the hook for Southern European Budget deficits. They will only be on the hook for the peanuts in this budget.

Where did you pick up that piece of misinformation?

best regards
Thomas


You are naive if you think it is going to stop here. This is just the first step towards fiscal union that Southern European want so desperately.


You do realize that requires a consensus decision, aka not ever going to happen unless every single member state agrees to the change. This is "Turkey will join, just a matter of time" bollox reloaded.

I ask again: Where did you pick up that piece of misinformation? You know, aside of you moving the goal post from "Northern European tax payers will be permanently on the hook" to "yeah, maybe, one day, if such a decision is ever made they will".

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 6:51 am

tommy1808 wrote:
Where did you pick up that piece of misinformation?


I suppose because a lot of nonsense is sprewed on these kind of subjects by notorious opponents of the EU.
In The Netherlands, Geert Wilders was talking about how 'we' (aka the Dutch) give 'them' (aka the rest of Europe) 750BN euro and how this should have been invested at home instead. :eyebrow:

Thus forgetting:
that its the EC which is borrowing and re-investing 750BN euro for the whole of the EU and not a cent is coming from the memberstates.
that the Netherlands can borrow and spend as much of their own money on themselves on top as they want, so there's no missed opportunity whatsoever
that 'we' (aka the Dutch) in this case back up only 6% of the sum should it not be reimbursed in time and the EC would fail to cover it itself
that 'we' (aka the Dutch) get to keep 20% of ALL import duties via the port of Rotterdam in return
that 'we' (aka the Dutch) will also get loans and possibly also handouts from this recovery fund to a yet unspecified amount
...

Dutch public broadcaster NOS had an interesting article calculating the total cost of this plan per capita... it turns out to be15 euro... not taking into account the investments the fund will make in The Netherlands...

But never let a good catch line about giving away billions of 'our' money to others get into the way of facts and figures of course and certainly don't mention all the return you get for this: a functioning common market with no red tape for your manufacturers, exporters and producers.
Amazed by the fact this simplistic rethoric still being used in fact, especially after it has been shown to be complete nonsense indeed by the UK.

https://www.bloomberg.com/news/articles ... ium-europe
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:18 am

sabenapilot wrote:
Thus forgetting:
that its the EC which is borrowing and re-investing 750BN euro for the whole of the EU and not a cent is coming from the memberstates.


The EU tax payers of the member states will need to pay this debt back. So every single cent comes from the member states.
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:22 am

sabenapilot wrote:
Dutch public broadcaster NOS had an interesting article calculating the total cost of this plan per capita... it turns out to be15 euro... not taking into account the investments the fund will make in The Netherlands...


On top of that: the only meaningful measure of cost/debt is in relation to GDP. Since it is to prop up GDP/keep it from deflating, this program will likely cost exactly nothing if it works only half way as intended.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:23 am

AeroVega wrote:
sabenapilot wrote:
Thus forgetting:
that its the EC which is borrowing and re-investing 750BN euro for the whole of the EU and not a cent is coming from the memberstates.


The EU tax payers of the member states will need to pay this debt back. So every single cent comes from the member states.


nope.

Again: Where did you pick up that piece of misinformation?

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:23 am

sabenapilot wrote:
But never let a good catch line about giving away billions of 'our' money to others get into the way of facts and figures of course and certainly don't mention all the return you get for this: a functioning common market with no red tape for your manufacturers, exporters and producers.


All those things existed before this first instance of mutualized debt was agreed. So none of it is "in return" for mutualized debt.
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:25 am

AeroVega wrote:
sabenapilot wrote:
But never let a good catch line about giving away billions of 'our' money to others get into the way of facts and figures of course and certainly don't mention all the return you get for this: a functioning common market with no red tape for your manufacturers, exporters and producers.


All those things existed before this first instance of mutualized debt was agreed. So none of it is "in return" for mutualized debt.


so did mutualized debt. So you have no point. And apparently no source for what you are obviously making up.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:26 am

tommy1808 wrote:
AeroVega wrote:
sabenapilot wrote:
Thus forgetting:
that its the EC which is borrowing and re-investing 750BN euro for the whole of the EU and not a cent is coming from the memberstates.


The EU tax payers of the member states will need to pay this debt back. So every single cent comes from the member states.


nope.


Nope? Who is paying for this debt then, if not EU tax payers of the member states?
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:41 am

AeroVega wrote:
tommy1808 wrote:
AeroVega wrote:

The EU tax payers of the member states will need to pay this debt back. So every single cent comes from the member states.


nope.


Nope? Who is paying for this debt then, if not EU tax payers of the member states?


mmm.... let me think.. who is usually paying for a loan, like when the member states take on money from it? Might it be the member state that takes out that loan from the fund? That is by definition not "the member states"

Not all of it is hand outs, and as it keeps the GDP from collapsing, so it is free money in every possible sense of the word. In fact the richer member states should actually come out the other side on top, which is why they ultimately agreed to it. Do good and cash in on it.

Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help. On top of the macroeconomic benefits.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:49 am

tommy1808 wrote:
Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help. On top of the macroeconomic benefits.


Indeed, and that 'profit' was later given back (at least by my country), as it didn't want to be seen as taking any financial benefits from other memberstate's economic misery...

It's really interesting to see how some people can not get their head around the concept of a win-win: it somehow has to be a zero sum game for them.
Time to wake up: it isn't.
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:54 am

AeroVega wrote:
sabenapilot wrote:
But never let a good catch line about giving away billions of 'our' money to others get into the way of facts and figures of course and certainly don't mention all the return you get for this: a functioning common market with no red tape for your manufacturers, exporters and producers.


All those things existed before this first instance of mutualized debt was agreed. So none of it is "in return" for mutualized debt.


And COVID-19 effectively risks braking much of it apart.

So having seen a glimps of the alternative reality of a Europe without SM after the case study of Britain, the 27 EU memberstates think this is just a small extra effort to save something as highly valuable as the SM and all the benefits it brings to each of them.
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 7:57 am

sabenapilot wrote:
tommy1808 wrote:
Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help. On top of the macroeconomic benefits.


Indeed, and that 'profit' was later given back (at least by my country), as it didn't want to be seen as taking any financial benefits from other memberstate's economic misery...

It's really interesting to see how some people can not get their head around the concept of a win-win: it somehow has to be a zero sum game for them.
Time to wake up: it isn't.


i think it is rather thinking about money in micro-economic terms without realizing that money works differently on the macro-economic level.

Every school should get a replica of the Monetary National Income Analogue Computer to bring that type of thinking closer to peoples minds...
https://en.wikipedia.org/wiki/MONIAC

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 8:13 am

tommy1808 wrote:
AeroVega wrote:
tommy1808 wrote:

nope.


Nope? Who is paying for this debt then, if not EU tax payers of the member states?


mmm.... let me think.. who is usually paying for a loan, like when the member states take on money from it? Might it be the member state that takes out that loan from the fund? That is by definition not "the member states"

best regards
Thomas


Correct: each of the beneficiaries has been servicing his own debt and so there's not a single euro being paid be any of the other EU memberstates for this.

Besides, Greece, Ireland, Cyrpus and Portugal as well as Spain have all excited their bailout programmes meanwhile.

- Ireland ended its bailout programme as scheduled in December 2013, without any need for additional financial support.

- In January 2014, Spain formally notified the ESM it would not draw upon the EU bailout mechanism without ever formally having picked up financial support.
(the money went straight to its banks instead)

- In May 2014, Portugal left the EU bailout mechanism without additional need for support.

- Cyprus exited the ESM programme in March 2016 without additional need for support.

- Greece's bailouts successfully ended in August 2018.

In none of these case, a single euro had to be spent by other EU countries.
The only thing that happened was that they backed loans issued by an EU institution to allow for very reasonable interest rates and thus to shield the concerned memberstate from having to pay crippling high interest rates on the market, rates which would certainly have caused the unlucky country to go down completely were it left on its own.
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 9:33 am

sabenapilot wrote:
tommy1808 wrote:
AeroVega wrote:

Nope? Who is paying for this debt then, if not EU tax payers of the member states?


mmm.... let me think.. who is usually paying for a loan, like when the member states take on money from it? Might it be the member state that takes out that loan from the fund? That is by definition not "the member states"

best regards
Thomas


Correct: each of the beneficiaries has been servicing his own debt and so there's not a single euro being paid be any of the other EU memberstates for this.


This not about an individual member state taking out a loan and paying it back. This is about the EU taking a 390 billion € loan and member states other than the beneficiaries of that loan being on the hook for paying it back.
 
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Aesma
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 9:37 am

The plan is for several taxes to pay for it : CO2 tax at the EU borders, GAFAM tax, and tax on financial transactions.

Also, without fiscal unity (including harmonizing corporate tax) there will always be a problem, the alternative is to break up the Euro or even the EU, something nobody really wants it seems.
New Technology is the name we give to stuff that doesn't work yet. Douglas Adams
 
Olddog
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 9:40 am

AeroVega wrote:
This not about an individual member state taking out a loan and paying it back. This is about the EU taking a 390 billion € loan and member states other than the beneficiaries of that loan being on the hook for paying it back.



I think you just forgot to consider the fact that the EU 27 GDP is close to 100 trillions over the next seven years. And if it gets negativr rates it will be a bonus.
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 9:42 am

tommy1808 wrote:
Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help.


But this time it is not a loan to Greece to be paid back by Greece tax payers. This time it is a loan to the EU to be paid back by EU tax payers.So Germany is actually now Greece.
 
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Aesma
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 9:43 am

wingman wrote:
Dieuwer wrote:
Good to see that Europe - after deliberating for 5 days - have come to a reasonable compromise. Market is clearly happy: Euro up, dollar down.
Europeans have shown to be adults and be able to come together. On the other hand, "Washington" is still the kindergarten as ever with daily mud sling contests.


The US is about to pass a second stimulus. Sure we sling mud but essential business still gets done. And I know for a fact that mud-slinging isn't exclusive to our 50 states. Any number of EU-related threads proves the much. There's one right next to this one!


Each individual EU country has full fiscal control and thus has been able to pass one or several stimulus plan already, this is just on top of it, from an entity with basically no fiscal power (EU budget is not even 1% of the economy, compared to the US Federal budget at 21%).
New Technology is the name we give to stuff that doesn't work yet. Douglas Adams
 
sabenapilot
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 10:13 am

AeroVega wrote:
This not about an individual member state taking out a loan and paying it back. This is about the EU taking a 390 billion € loan and member states other than the beneficiaries of that loan being on the hook for paying it back.


Ah, you want to talk about just the portion of the fund which consists of subsidies because there you think you have a higher chance of success?

Well, let me put you out of your illusion: those grants are actually going to be paid by 'foreigners' to put it in easily understandable words.

A tax on industrial imports to the EU, a tax on non-EU-based internet companies, a carbon tax on plane tickets for connecting flights with non-EU airlines (rather than just the first leg alone as is now the case), etc. etc.

The EC has been mandated to work out a set of proposals in detail for the Euro Council to decide later, but it's again NOT the EU taxpayer who's going to pay the bill: in fact it's going to be the non-EU taxpayer, so ironically the British are probably going to contribute more to this recovery plan now, than they would were they still in the EU.

Brexit is a gift that just keeps on giving since we now have a sizeable third country next door who's economy is so dependant on trading with our SM, we can basically squeeze it to our liking. ;)
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 11:19 am

AeroVega wrote:
tommy1808 wrote:
Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help.


But this time it is not a loan to Greece to be paid back by Greece tax payers. This time it is a loan to the EU to be paid back by EU tax payers.So Germany is actually now Greece.


Nope. This is in no way different as in the Euro Crisis. All Member States guarantee the loan, but the country actually taking a loan out of that borrowed money has to pay it back, with interest.

You still haven´t given us a source for your misinformation.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
tommy1808
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 11:21 am

sabenapilot wrote:
AeroVega wrote:
This not about an individual member state taking out a loan and paying it back. This is about the EU taking a 390 billion € loan and member states other than the beneficiaries of that loan being on the hook for paying it back.


Ah, you want to talk about just the portion of the fund which consists of subsidies because there you think you have a higher chance of success?

Well, let me put you out of your illusion: those grants are actually going to be paid by 'foreigners' to put it in easily understandable words.

A tax on industrial imports to the EU, a tax on non-EU-based internet companies, a carbon tax on plane tickets for connecting flights with non-EU airlines (rather than just the first leg alone as is now the case), etc. etc.

The EC has been mandated to work out a set of proposals in detail for the Euro Council to decide later, but it's again NOT the EU taxpayer who's going to pay the bill: in fact it's going to be the non-EU taxpayer, so ironically the British are probably going to contribute more to this recovery plan now, than they would were they still in the EU.

Brexit is a gift that just keeps on giving since we now have a sizeable third country next door who's economy is so dependant on trading with our SM, we can basically squeeze it to our liking. ;)


also: Since everything paid for by this program has to be in accordance with Paris climate goals it enables picking lower hanging fruits in poorer countries instead of richer countries paying more to reduce their own emissions.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 11:32 am

tommy1808 wrote:
AeroVega wrote:
tommy1808 wrote:
Last time around it was the same "oh no... we have to take over the Southern members debt".... i didn´t check on other countries, but Germany ended up with almost 3 Billion in profits from that help.


But this time it is not a loan to Greece to be paid back by Greece tax payers. This time it is a loan to the EU to be paid back by EU tax payers.So Germany is actually now Greece.


Nope. This is in no way different as in the Euro Crisis. All Member States guarantee the loan, but the country actually taking a loan out of that borrowed money has to pay it back, with interest.

You still haven´t given us a source for your misinformation.


According to https://www.politico.eu/article/eu-lead ... very-fund/ the recovery package consists of 390 billion € grant and 360 billion € loan, all covered by mutualized EU debt.

That's my source.

Now please give me your source that states that the grant part has to be paid back by the beneficiaries.
 
AeroVega
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 12:04 pm

sabenapilot wrote:
AeroVega wrote:
This not about an individual member state taking out a loan and paying it back. This is about the EU taking a 390 billion € loan and member states other than the beneficiaries of that loan being on the hook for paying it back.


Ah, you want to talk about just the portion of the fund which consists of subsidies because there you think you have a higher chance of success?


The contention was never about the loan part. Can you give any source where the frugal four have complained about the loan part that gave you the impression that this was about the loan part?

sabenapilot wrote:
Well, let me put you out of your illusion: those grants are actually going to be paid by 'foreigners' to put it in easily understandable words.

A tax on industrial imports to the EU, a tax on non-EU-based internet companies, a carbon tax on plane tickets for connecting flights with non-EU airlines (rather than just the first leg alone as is now the case), etc. etc.

The EC has been mandated to work out a set of proposals in detail for the Euro Council to decide later, but it's again NOT the EU taxpayer who's going to pay the bill: in fact it's going to be the non-EU taxpayer, so ironically the British are probably going to contribute more to this recovery plan now, than they would were they still in the EU.

Brexit is a gift that just keeps on giving since we now have a sizeable third country next door who's economy is so dependant on trading with our SM, we can basically squeeze it to our liking. ;)


To decide later being the keyword here. Any idea how much they are going to bring in?

Regardless, tax on industrial import and non-EU based internet companies are just an indirect tax on EU tax payers anyway. And extra carbon tax on connecting flights is not going to happen given the state EU airlines will be in for the foreseeable future. Especially with low-tax Britain next door. Plenty of transfer opportunities there.
 
Olddog
Posts: 1519
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 1:12 pm

Aesma already answered to you. You should read a bit more politico and realize that the plan for reimbursement is for 40 years and by the EU commission.
 
tommy1808
Posts: 13284
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 2:00 pm

AeroVega wrote:
tommy1808 wrote:
AeroVega wrote:

But this time it is not a loan to Greece to be paid back by Greece tax payers. This time it is a loan to the EU to be paid back by EU tax payers.So Germany is actually now Greece.


Nope. This is in no way different as in the Euro Crisis. All Member States guarantee the loan, but the country actually taking a loan out of that borrowed money has to pay it back, with interest.

You still haven´t given us a source for your misinformation.


According to https://www.politico.eu/article/eu-lead ... very-fund/ the recovery package consists of 390 billion € grant and 360 billion € loan, all covered by mutualized EU debt.

That's my source.

Now please give me your source that states that the grant part has to be paid back by the beneficiaries.


The word "loan".

Best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
sabenapilot
Posts: 3312
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Re: Eu budget of 1.82 T Euro agreed

Wed Jul 22, 2020 3:11 pm

AeroVega wrote:
The contention was never about the loan part.


As Thomas pointed out, it clearly was (too).
Don't try to move the goalposts...

AeroVega wrote:
To decide later being the keyword here. Any idea how much they [internet taxes, extraterritorial carbon emission taxes etc] are going to bring in?


Im not the EC, but to reimburse around 390BN over 40 years at close to zero interest rate, they just needs to bring in 10BN annually...
peanuts for an economy the size of the EU.

AeroVega wrote:
Regardless, tax on industrial import and non-EU based internet companies are just an indirect tax on EU tax payers anyway. And extra carbon tax on connecting flights is not going to happen given the state EU airlines will be in for the foreseeable future. Especially with low-tax Britain next door. Plenty of transfer opportunities there.


You really don't get it, do you?

A Google tax is paid by Google, a Facebook tax is paid by Facebook, etc..
Users don't pay for their services, they are "for free" and make their money from advertisements, so how on earth would this be an indirect tax on EU consumers then?
The foreign internet companies can always decide not to pay the EU tax it and just show a blank screen within the EU then... let's see if they do so, shall we?
The bigger the market, the more leverage you have with companies like these: they simply can not affort not to be present within the SM, simple as that.

EU airlines already pay the full carbon tax on the entire trip with them, whereas right now non-EU airlines only pay the tax on the first portion (till their hub), not the second portion of the flight.
One of the 'Green' ideas is to tax tickets of the likes of EK, EY, QR for the full trip with them, rather than just the short leg to their respective hub.
Again, the EU can only win from this: either people keep flying with these airlines and then more money flows in, or they change to the EU based competitors and then more jobs are created.
Currently airlines from low tax britain pay the same carbon taxes as their counterparts in the EU: should the UK decide to lower those in an effort to attract more pax through LHR, then the result will be the EC taxing away any price advantage: that's your sovereignty ridiculed right in your face... tax money directly transferred from the British treasury to the EU's current accounts. Thank you!

This landmark agreement really does change the way things are done in the EU, because it weaponizes the EC to start taxing extraterritorially.
Given the shear size of the EU and the notorious 'Brussels effect', you better be inside than outside as from now: if you're not at the table, you risk ending up on the menu.
 
User avatar
atcsundevil
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Re: Eu budget of 1.82 T Euro agreed

Thu Jul 23, 2020 4:57 am

Please keep the thread on topic. There's no need for personal attacks. Please just address others respectfully, even if you disagree.

✈️ atcsundevil
 
flyguy89
Posts: 2989
Joined: Tue Feb 24, 2009 6:43 pm

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 7:20 am

sabenapilot wrote:
A Google tax is paid by Google, a Facebook tax is paid by Facebook, etc..
Users don't pay for their services, they are "for free" and make their money from advertisements, so how on earth would this be an indirect tax on EU consumers then?

Increased ad serving costs for EU based advertisers for one. These companies also offer a lot of consumer-purchased products and services that could certainly see increased costs to be born by EU consumers.
 
Olddog
Posts: 1519
Joined: Sat Jun 25, 2016 4:41 pm

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 7:31 am

The relation between price and cost is not that simple. Final price factors a lot of considerations that are often more a function of what is acceptable by the market and not the production cost.
 
tommy1808
Posts: 13284
Joined: Thu Nov 21, 2013 3:24 pm

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 8:14 am

Olddog wrote:
The relation between price and cost is not that simple. Final price factors a lot of considerations that are often more a function of what is acceptable by the market and not the production cost.


its also the weirdest reason for not having taxes...... advertisement costs are always paid for by the consumer, und more expensive advertisement likely means less advertisement if it otherwise moves the product of the best price point. And less advertisement on Websites would be kinda nice.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
olle
Topic Author
Posts: 2272
Joined: Tue Feb 06, 2007 3:38 am

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 10:17 am

I have a sensation that EU will look very different in one generation from now.
 
olle
Topic Author
Posts: 2272
Joined: Tue Feb 06, 2007 3:38 am

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 10:17 am

I have a sensation that EU will look very different in one generation from now.
 
flyguy89
Posts: 2989
Joined: Tue Feb 24, 2009 6:43 pm

Re: Eu budget of 1.82 T Euro agreed

Fri Jul 24, 2020 2:57 pm

Olddog wrote:
The relation between price and cost is not that simple. Final price factors a lot of considerations that are often more a function of what is acceptable by the market and not the production cost.

It's not simple, but it is generally the case. Trump's tariffs are an excellent example where, contrary to the administration's claims, Americans are generally bearing the brunt for the costs of the tariffs. It's not a reason not to have taxes, but it would certainly be disingenuous to think applying some extra tax to the major tech companies won't have implications for EU consumers and would only be "free money."
 
Sokes
Posts: 1666
Joined: Sat Mar 09, 2019 4:48 pm

Re: Eu budget of 1.82 T Euro agreed

Mon Aug 03, 2020 6:20 am

Who pays for it? Who says it ever has to be paid back? Of course interest has to be paid.
Earlier German households as a group would save. Most of these savings were absorbed by German businesses, some by German government. Since for many years German salaries didn't increase close to productivity growth German businesses make enough profit to do without increasing debt. German government also doesn't take debt. So the savings now go abroad, before 2008 with proper interest, now with no interest, but inflation.

So a lot is paid by German and other countries savings via inflation. Moreover savers react and shift their wealth into properties. Own housing therefore becomes difficult to finance for a young family. I wonder how Southern Europeans who have a much higher proportion of own housing would like it if housing markets in their countries become unaffordable. But then it depends on the area. Where there is low demand the cheap interest may make financing a house even cheaper.

So why does Merkel do it?
I believe because at the moment there is free travel. Germany gets young and qualified immigrants which keep housing prices up, pay taxes and maintain our social insurance.
As no government ever pays back is debt one only has to see interest. It's those with savings who pay for transfers via inflation.

Why is it always claimed that taxpayers have to pay when they profit enormous from no or low interest on government debt?

Even if it had to be paid back by taxpayers I believe the pandemic demands solidarity. Once the pandemic ends, money transfers should stop. I heard news that in Italy court cases take 6-8 years to settle. That's not a money problem, it's policy failure. Strict foreign intervention, preferably by the IMF is required.

I'm not familiar much with European affairs any more, but I read Greece is doing a little bit o.k. now.
I am a strong believer that sometimes one needs foreign help. I'm therefore a Napoleon and Roosevelt fan. I also like the British Empire.

Speaking of Spain:
Should a country with trade deficit have a minimum wage? But overall I believe Spain deserves little blame. They knew debt gets inflated away and therefore took a lot of private debt when the Euro with low interest was introduced. Well, it wasn't the same money any more. I made the same mistake when I came to India, thinking Indian money is like our money. But the Spanish government had exemplary household discipline when the crisis started 2008. How is Spain doing now?

To come back to Italy and the necessary reforms:
If your child misbehaves, do you buy him an ice cream in exchange for the promises to behave in future?
Why can't the world be a little bit more autistic?
 
JJJ
Posts: 3734
Joined: Wed May 31, 2006 5:12 pm

Re: Eu budget of 1.82 T Euro agreed

Mon Aug 03, 2020 7:00 am

flyguy89 wrote:
sabenapilot wrote:
A Google tax is paid by Google, a Facebook tax is paid by Facebook, etc..
Users don't pay for their services, they are "for free" and make their money from advertisements, so how on earth would this be an indirect tax on EU consumers then?

Increased ad serving costs for EU based advertisers for one. These companies also offer a lot of consumer-purchased products and services that could certainly see increased costs to be born by EU consumers.


That's one way to look at it, but since companies generally have a fixed advertisement budget that they allocate to different media depending on return, etc. it's quite likely that the overall costs of advertising for consumer companies remain flat.

Honestly targeted ads on social media for most consumer products is something you need to have to stay up to date and project a certain image but when you scratch the shiny surface the return just isn't there except for a tiny subset of companies. For the most part they just kick the can down the road and make projections that they'll get X return and Y years and just move the goalpost one more year when it comes the time to crunch the numbers.
 
JJJ
Posts: 3734
Joined: Wed May 31, 2006 5:12 pm

Re: Eu budget of 1.82 T Euro agreed

Mon Aug 03, 2020 7:18 am

Sokes wrote:
So a lot is paid by German and other countries savings via inflation. Moreover savers react and shift their wealth into properties. Own housing therefore becomes difficult to finance for a young family. I wonder how Southern Europeans who have a much higher proportion of own housing would like it if housing markets in their countries become unaffordable. But then it depends on the area. Where there is low demand the cheap interest may make financing a house even cheaper.


That's exactly what happened in the years leading to 2008. The policy of zero interest rate to help the then struggling German economy overheated the Southern economies, very especially Spain.

For a few years Spain was producing as many homes as France and Germany together. Construction made over 10% of GDP and housing prices grew at double digits for a good two decades.

When Spain entered the EU in the 80s debt was about 30% of disposable income, crossed 50% by the 90s and at the height of the housing bubble it crossed the 100% mark. Average term for mortgages doubled from 12 to 25 years (to absorb ever increasing home prices). Housing stock shrank in average sqm. per apartment.

Prices still haven't recovered. I bought my current house this year (built in 2007, right before the crisis) for about a third less than it sold new.
 
Sokes
Posts: 1666
Joined: Sat Mar 09, 2019 4:48 pm

Re: Eu budget of 1.82 T Euro agreed

Mon Aug 03, 2020 10:15 am

JJJ wrote:
Sokes wrote:
I wonder how Southern Europeans who have a much higher proportion of own housing would like it if housing markets in their countries become unaffordable.


That's exactly what happened in the years leading to 2008. The policy of zero interest rate ...

After 9/11 interest rate of ECB went from 4.75 to 2%, but then later up again. I believe close to 0% is after financial crisis.

What did the Spanish do with all this housing? Were old houses too uncomfortable, was it a movement to cities or did the flats remain empty as an investment only?

Was there a similar expansion in industry? Was it already overheated before 2001? When did the excesses start?
Why can't the world be a little bit more autistic?

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