100 days of Commission: from Draghi and Letta to Trump, towards a new Single Act

The European Union, like democracy itself, is in danger, in Putin's crosshairs, but also in Trump's, as is the desideratum of a "rules-based world".

"The European Union, like democracy itself, is in danger, in Putin's crosshairs, but also in Trump's, as is the desideratum of a 'rules-based world'"

In the strictly economic sphere, last September the Draghi report on competitiveness was published, commissioned months earlier by Commission President Ursula von der Leyen, with the aim of having a roadmap on economic policy for her second term, elections permitting. In addition, the Letta report on the single market, commissioned by the European Council, provided additional ideas for this new economic strategy of the Union. Both documents thus illuminated a reform agenda for this legislature with the promise of reviving the slow growth of the European economy. The time had come, then, for political decisions, the Commission's impetus and the legislative work of Parliament and the Council.

Firstly, Draghi bets on a simplifying agenda of community legislation. In the past legislature, marked by the Green Deal, different legislative texts were approved to guide the path towards the decarbonisation of different economic sectors. Draghi states that in numerous instances these decarbonisation paths reflect greater public dirigisme than desired, betting on technologies that are not sufficiently mature and avoiding greater neutrality that could help reduce emissions in the short term without waiting for major technological innovations. He remains firm, in any case, on the need to have clear dates and objectives that guide private investment in the decarbonisation process, but considers that greater flexibility would be useful on the path to their achievement.

In parallel, Draghi considers that the public information requirements of climate risks and pollution reports approved through different legislative initiatives configure a framework that is too complex. In this sense, the transparency and information to the market and to supervisors that explain such proposals could be damaged by the need to report similar risks through different channels and formats, forming a regulatory tangle that, beyond compliance costs, might not offer clear and coherent information to comply with the public good with which said regulatory framework was conceived. Thus, Draghi sentences that there is ample space for simplification without damaging the purposes of transparency.

Secondly, the Draghi report introduces the design of an industrial policy, which also requires a review of trade policy and the implementation of competition policy. This area of the report undoubtedly represents a turning point in the Union's more liberal and free-trade tradition.

Draghi starts from the global environment heavily marked by the industrial policies of the United States and China, and the imperative need to achieve greater strategic autonomy for the Union. The supply problems during the COVID-19 pandemic, first, and the effects of Putin's invasion of Ukraine that required the implementation of sanctions on the Russian economy, especially in the energy area, alerted the community authorities about the European Union's high dependence on imports from third jurisdictions in certain critical goods or even services.

Likewise, the decarbonisation process also requires a more active industrial policy, to the extent that responses exclusively based on markets and private incentives are not enough to complete this path successfully. The digital challenges, the development of artificial intelligence, the power of the cloud and data, or the development of the platform economy, all sectors with few European operators and subject to profound security risks, advise, according to Draghi, greater involvement of public powers in their development and growth.

This reflection is extended with greater relevance to the field of defence, as a continuation of that commitment to strategic autonomy that contemplates the energy sector, the provision of critical raw materials, telecommunications, the financial sector and, as I previously said, the digital economy. What has happened since January of this year in Washington makes this agenda of open strategic autonomy of the Union even more urgent.

In parallel, this new industrial policy requires, following Draghi, another trade policy, partially abandoning community free trade. In that sense, a micro tariff policy would be necessary that would fix infant industries to be protected, a security framework to allow effective decarbonisation, or trade activism for the provision of raw materials not present on European soil.

To finish giving coherence to this entire industrial strategy, Draghi also addresses the renewal of competition policy and state aid. Again, the report moves away here from the classic doctrine of the Union and calls for facilitating business mergers that give rise to European champions, softening or revising the current controls of such corporate operations. Similarly, he calls for a reinterpretation of state aid regulation that, without undermining the integrity of the single market, could cooperate in this relaunch of industrial policy.

Thirdly, and in full coherence with the industrial policy that Draghi defends, the report calls for an extraordinary reinforcement of the consolidation of the single market. There is not, in any case, an exclusive chapter on this matter and Draghi refers to the Letta report, whose conclusions he supports and shares. However, Draghi cannot entirely segment his report to additional and complementary recommendations regarding Letta's report on the single market, so that, in all his sectoral analyses, from telecommunications to energy, from defence to capital markets, there is a determined commitment to accelerate the consolidation of such markets on a European scale.

For his part, Letta begins his report by advocating for a profound transformation of the single market towards an authentic European market, taking a leap forward in community integration, as was the step from the common market to the single one in the times of Jacques Delors. Letta shows a detailed attention to markets with greater consolidation problems, namely, telecommunications, energy and finance, but also provides a more political vision aimed at attracting attention and attraction for these debates on market integration, often too harsh and without a clear popular appealing.

Letta defends adding to the current four freedoms enshrined in the treaties (freedom of movement of people, goods, services, and capital) a fifth focused on freedom to research, innovate and educate, which could focus shared efforts aimed at improving and accelerating the transformation of a new economic structure, heavily marked by the green and digital transition.

In the fourth and final place, Draghi analyses the financing of his plan. And it is here where Draghi requests an additional investment of some 800 billion euros annually during the next exercises, a proposal to be considered in the negotiation of the 2028-2034 Multiannual Financial Framework and in the discussions on the future of NextGenerationEU.

Draghi first stops at the need to free up private savings for investments in the Union, for which it is an inexcusable condition to complete the banking and capital union, renamed by Letta and the new Commission as the Savings and Investment Union. In this area, Letta and Draghi transparent the excess of savings of the European economy, which fails to find investment opportunities on community soil. In this sense, a commitment is made again to complete the banking union with the closure of the negotiation of its third pillar, the common deposit insurance and the signature of the backing of the Stability Mechanism (ESM) to the banking resolution framework. Along the same lines, we should move from the current twenty-seven capital markets to a single European one, reinforcing community supervision and the elimination of the still existing national barriers.

Draghi and Letta also insist on the need to direct a greater part of savings to capital markets to facilitate non-bank financing and equity markets, while giving a complementary response to the challenges derived from demographic ageing, also betting on orderly emigration that helps address such challenges.

However, even by freeing up private savings, Europe still needs a community investment instrument financed with common debt. Thus, Draghi calls for giving continuity to NextGenerationEU with a similar instrument that strengthens the Union's budget and collaborates in the financing of his entire plan, among other things, to implement part of his proposals in matters of industrial policy, which requires pooled resources to avoid a potential fragmentation of the single market.

"Even by freeing up private savings, Europe still needs a community investment instrument financed with common debt"

For this, it is also necessary to accelerate the implementation of a new basket of own resources, a necessary condition to issue European debt with a support of recurring income that defends the debt service and its amortisation. That common debt would be called to be configured as an authentic risk-free European asset, strengthening the role of the euro in international markets and with it the strategic autonomy of the Union, which in turn requires the issuance of the digital public euro, whose negotiation is already taking place in the co-legislators on the Commission's proposal from the past legislature.

Thus, Mario Draghi, along with the contributions of Enrico Letta in the field of the single market, put on the table of the community institutions a holistic roadmap that is now to be landed. Such a roadmap, considered a whole, represents a good basis for debate for political operators, subject, in any case, to different considerations.

We could agree that the entire chapter on administrative simplification could find some resistance in progressive forces, if such a path began to slide towards greater deregulation. That is, the border between simplification and deregulation is very thin and, although, socialists are open to address such a debate, it is necessary to clarify that, to find a space of balance and encounter, the Draghi report should be taken as a whole and not partially.

On the other hand, the revision of industrial, commercial, and competition policy also opens other flanks, insofar as it represents a profound re-reading of the Union's economic policy doctrinal body. In this case, it is more complex to demarcate opinions on the matter between the more progressive or liberal-conservative approaches. In principle, we could agree that the greatest industrial activism is found closer to the feelings of progressive forces, although the commitment to strategic autonomy is very transversal, as is also the perception of the risks of fragmentation of the single market. Furthermore, a debate is also opened here that can divide small and large countries, if the former identifies behind this commitment the vocation of the latter to dominate European markets through their national companies that could be called to become "European champions".

Thus, in this area, a calm and measured debate would be necessary on such a turn that requires forming a new community consensus that is also useful to consolidate the single market, which happens by centralising a good part of such strategy and financing in the Union, as Draghi himself defends.

On the other hand, neither the Draghi report nor that of Letta make a substantial contribution to the necessary strengthening of the European social model, although it plans, in some cases with express references, both documents. However, this lesser presence of social remnants cannot be an obstacle to forgetting that, along with initiatives to activate growth, our social model and environmental sustainability must be part of any economic policy agenda, so that the recommendations of both reports should be complemented by the social perspective that some of us miss in the current public debate.

In short, the recommendations of the Draghi report, but also of Letta's paper, represent, above all and, above all, a markedly Europeanist synthesis focused on the single market, European financing and common industrial policy, on which different accents can fit to the left and right, to the north and south, and even to the east and west. But, in any case, we are facing a roadmap aimed at deepening and accelerating the European project as a necessary condition to accelerate the productivity and growth of the European economy.

Once the recommendations of Draghi and Letta have been briefly analysed, we must evaluate the distribution of power in the community institutions to make a first calibration of the probability that such ideas can be put into practice. In this sense, it is necessary to be aware that the result of the European elections and the most recent national elections have strengthened the weight of Eurosceptic, Euro-hostile or directly anti-European forces, almost all of them located currently on the extreme right. It is true that pro-European formations maintain the centrality of power in public institutions, but the slide of the electorate towards a right-wing and hyper-nationalist populism is already conditioning the European public debate, and especially the political strategy of the traditional centre-right throughout the continent. Let's see.

That possibility is even more solid, given the slide of power in the liberal group, Renew, from a pronounced leadership of Macron's pro-Europeans towards a greater weight of national delegations from northern countries, whose approach to the European project is less committed.

Therefore, EPP, ECR, Patriots, Sovereignists, the majority of non-attached MEPs and a part of Renew offer a broad majority to the right in the chamber, but a majority that will not lead an acceleration of the European project, rather it would represent an unprecedented reversal in the history of the Union.

Undoubtedly, articulating this majority is not a simple mission, since the sovereignist logic of these forces leads them towards distrust of 'foreign' agents. Likewise, the divergences between all these groups cannot be ignored, among which abound outlandish positions, crazy deputies, Nazis, or deniers of any historical or scientific evidence such as the Holocaust or Climate Change.

But as difficult as it may be to configure a stable government majority among these groups, the mere existence of that possibility represents a permanent threat in each negotiation, not only for progressives but essentially for pro-Europeans of any party because that coalition, beyond right-wing, would prevent any advance of the European project, as established in the Draghi report or in that of Letta, or any coherent response to the new threats from Trump or the traditional ones from Putin.

Certainly, that majority could lead a firm support for a profound deregulation of European regulations that, distorting what Draghi expressed in his report, would like to find intellectual support in the debate on administrative simplification that the former president of the European Central Bank has put on the table. However, that potential deregulation would have little to do with improving the competitiveness of the European economy, and would respond exclusively to an ideological agenda to dismantle the entire Green Deal, replicating the aspirations that come from the other side of the North Atlantic.

It is important to highlight that the bureaucratic and administrative costs problem in Europe focuses on national regulations that prevent the consolidation of the single market, not on community norms that the right now wants to revise in a populist competition with little impact on our productivity. I will return to this issue later.

In another order of things, whilst the EPP has in its hand a potential majority to its right at the cost of forgetting its European commitment, in the classic pro-European consensus by which the Union has been governed for decades, the ideological balance to the right and left has varied very little compared to the past legislature. And perhaps this has been less debated.

Perhaps it could be argued that the formal entry of ECR into the majority that supported the College of Commissioners, which did not support the investiture of Ursula von der Leyen, would certify that slide to the right of the coalition that sustains the Commission. However, pro-European groups were not applying the "cordon sanitaire" to ECR during the past legislature, and de facto they joined almost all the majorities in the legislative initiatives approved by the chambers, including the Migration Pact. Moreover, their weight in Parliament has barely increased significantly in the last elections. In this way, formally or informally, ECR's situation has not changed in a transcendental way after the last elections and its margin of manoeuvre and influence is similar to that experienced in the previous legislature. The substantial change is the growth of the Patriots, the former Identity and Democracy group, which is what now allows a parliamentary majority across the entire right-wing arc of the chamber. For all these reasons, within the political majorities that supported the bulk of measures adopted in the 2019-24 period, the ideological balances have not varied dramatically.

In this way, the dilemma of the EPP is transparent: maintain pro-European collaboration, without significant changes in the balance of forces in that soft coalition despite having grown in the last European elections, or lead an alternative majority with the entire right to push an agenda in which there is no hint of any Europeanism.

Until now, the People's Party has been playing with these two options on the table, tensions that are also being reflected in the College of Commissioners since the beginning of the process for its formation.

After the European elections last June, and observing the parliamentary majorities, the European Council nominated Ursula von der Leyen again as a candidate to preside over the Commission. That decision was taken, by the way, without the support of Georgia Meloni's Italy. Her subsequent parliamentary investiture, following the same logic, had the favourable vote of populars, socialists, liberals and greens, but not with the support of ECR.

Despite all this, in September, von der Leyen considered it appropriate to reward the Italian candidate to join the Commission not only with an important portfolio, but also with an executive vice-presidency. A concession, clearly, unnecessary. Let's remember that the previous Italian commissioner, Paolo Gentiloni, held the key Economics portfolio, but was not a vice-president.

Finally, the College of Commissioners was approved as a whole, without any rejection or change of relevant portfolios, but the institutional role of Parliament was eroded. The socialists saved our candidates for commissioners at the last minute, especially important after the harassment and demolition campaign against Teresa Ribera. The populars passed their candidates, some of whom do not have the stature for such responsibilities, as did all the liberals, while Raffaele Fitto or Olivér Várhelyi were also integrated into the Commission without major setbacks.

Thus, the express protection of the EPP for the Italian ECR candidate, as well as for Orbán's man in the Commission, together with the cruel attacks against the socialist candidate Teresa Ribera, not only opened cracks of confidence in the pro-European majority, but also made transparent the new strategy of the People's Party.

That being said, the distribution of power in the capitals of the Member States has resulted in a Commission biased to the right. Suffice it to say that only four commissioners belong to the socialist family. Besides, the EPP, counting Ursula von der Leyen, has fifteen commissioners and the liberals of Renew, four. The ECR conservatives have one portfolio (Italy) and the Patriots another (Hungary). Finally, the Slovak commissioner Maroš Šefčovič, whose party belonged to the socialist group until its recent expulsion, is now not attached to a European political family.

Therefore, the popular presence in the community cabinet is very broad, even though Von der Leyen has tried to somewhat balance the power by granting two vice-presidencies to socialist commissioners, to Teresa Ribera and Roxana Minzatu, and two more to Renew, Stéphane Séjourné and Kaja Kallas, although, as I said, the ECR vice-presidency represents a much-discussed upgrade to Meloni's Italy. It is difficult to explain, by the way, that the Spanish delegation of the PP voted against the entire College of Commissioners. But that is another story.

Certainly, we cannot circumscribe European debates to the exclusively ideological left-right axis, insofar as the discussion between more or less Europeanism results in even considerably more conflictive occasions than the first. In any case, the centre-right majority in the Commission is clear, much more solid than its strength in Parliament, where within the framework of pro-European groups the balance to the left and right has been kept relatively more stable.

This distribution of the Commission reflects, as we said, in turn the distribution of power in the capitals of the Member States, which has its mirror in the composition of the EU Council and in the European Council, this last institution presided over by the socialist and deeply pro-European Antonio Costa, although again we find a conservative majority with a not minor presence of Eurosceptic, Euro-hostile or anti-European heads of government.

Starting with the latter, the leaders of Czechia, Slovakia, Hungary, and Italy are outside the pro-European forces. In addition, the new Belgian prime minister belongs, like Giorgia Meloni, to ECR, although his Flemish party leads a coalition government where Flemish socialists, populars, and liberals are present, thus tempering the tone of the entire government in relation to the European Union. On the contrary, in the Netherlands, although we find an independent prime minister, the main force of the executive is the formation of the far-right and anti-European Geert Wilders, the Party for Freedom, belonging to the Patriots group.

Furthermore, in Croatia, Luxembourg, Ireland and Latvia, centre-right coalitions govern, as well as in Sweden or Finland, where far-right parties participate in these last two cases. In Greece and Portugal, the government falls into the exclusive hands of the People's Party. In Romania, we have a grand coalition pending the cancelled presidential elections, reprogrammed for next spring. In Bulgaria, the grand coalition is broader, adding members of ECR, while in Cyprus, we have a multi-party government. In Poland, an executive led by the EPP and with all the European forces, including the socialists, with an opposition led by Law and Justice (ECR). And in Estonia, Lithuania, and Slovenia there is a government of liberals and socialists. Finally, in socialist hands we have Denmark and Malta, along with Spain, in a coalition government with Sumar (Greens/Left).

Finally, France, headed by the liberal Macron, has a centre-right government with notable fragility, and in Austria, after very complex negotiations following the victory at the polls of the extreme right, there is already a grand coalition government with populars, socialists, and liberals. Grand coalition, in this case of populars and socialists, which is also repeated in Germany after the recent elections.

Thus, in a brief review of power in the Member States, we already find a solid nucleus to the right of the EPP, with clearly Eurosceptic, Euro-hostile or anti-European positions led by Orbán and Meloni.

"In a brief review of power in the Member States, we already find a solid nucleus to the right of the EPP, with clearly Eurosceptic, Euro-hostile or anti-European positions led by Orbán and Meloni"

Moreover, they are present in governments with great force such as in the Netherlands and threaten the stability of France, while in Austria or in Germany, they have been forced into grand coalition governments given the electoral strength of that anti-European extreme right. In other countries, as is the case in Italy, that extreme right finds collaboration and support also in the People's Party, whose dilemma between confronting or cooperating with the extreme right has reached the community institutions.

The summary, therefore, is that, in terms of power balances, we have begun a well complex legislature, marked by an increase in the People's Party's room for manoeuvre towards Eurosceptic extremes; by a Commission with a clear right-wing bias; and with a distribution of power in the community capitals where distrust towards the European project increases. In any case, the pro-European majority retains the power to guide European policies, for which a greater commitment from the People's Party is needed, while the grand coalitions, the last ones in Germany and Austria offer some stability in this global framework so uncertain, well-marked of late by the arrival of the Trump Administration.

Once the recommendations of the Draghi report, commissioned by the President of the Commission to guide her second term, have been briefly exposed, to which are added the proposals of Letta, at the request of the President of the European Council, as well as the distribution of power in the community institutions in this new mandate, it is worth asking about the plausibility of implementing an agenda more or less in accordance with both reports, in view also of the first beats of this legislature.

Well, the Commission presented on January 29 its Competitiveness Compass with which it frames the whole of its economic agenda. This document stands out essentially for its approach to industrial policy that represents a fundamental change in the economic paradigm of the Commission, a reorientation that began to dawn from the supply problems during the COVID-19 crisis, accentuated after the start of the war in Ukraine and the sanctions linked to the energy sector. In addition, the decarbonisation process or the industrial plans of the Biden Administration ended up setting a reorientation of economic policy that is less horizontal and more focused on the promotion of "strategic" industries.

Thus, in the Competitiveness Compass a strategy is proposed to develop innovation and its diffusion to the whole of the economy, a renewed synthesis between the Green Deal and industrial development with affection to different sectors, from agriculture to the circular economy, passing through transport, among others. Additionally, the document delves into the issues of strategic sovereignty to retain or develop local productions of potentially critical goods or services.

"The Competitiveness Compass delves into the issues of strategic sovereignty to retain or develop local productions of potentially critical goods or services"

It is worth noting, in any case, that the Competitiveness Compass barely dedicates little more than a page to commenting on the need to consolidate the single market, given the recommendations of Draghi and especially of Letta, and the bulk of the Competitiveness Fund or community financial support for the entire industrial strategy remains pending for the future, perhaps in the market of the MFF negotiation. In any case, very little in this report on the single market and financing.

In the strictly industrial sphere, the Commission also published on February 26 its Clean Industrial Deal report in which it lands somewhat more the synthesis for a new industrial policy, not green, but "clean". The report pays special attention to about electro-intensive companies, as well as the technology sector, with a direct impact on efforts to decarbonise industry. Therefore, the Clean Industrial Deal raises necessary options to lower energy costs with the aim, for example, of facilitating long-term electricity contracts, an open path with the revision of the electricity reform of the past legislature, to which now adds the assistance of the European Investment Bank to offer guarantees in such contracts and develop that market. The report is complemented in this area with the Affordable Energy Action Plan, which contains other proposals in the same direction.

Likewise, the Clean Industrial Deal proposes new ways to raise the demand for green products by revising public procurement or defining a new Made in Europe, to be specified in a new legislative proposal (Industrial Decarbonisation Accelerator Act).

On the other hand, the Commission insists on its proposals on the circular economy, the implementation of the Critical Raw Material Act and the development of measures adopted in the past legislature. In the area of financing of this entire plan, the Commission refers to the Innovation Fund, InvestEU and a new Industrial Decarbonisation Bank, whose concretisation we will see later.

Finally, and in the area of financing, the Commission also announces the revision of state aid regulation to facilitate public support for this entire industrial policy agenda, support that, in any case, remains in one way or another at the expense of the budgets of the Member States. So that, as in the Competitiveness Compass, we hardly find anything noteworthy in the community budgetary sphere, opening the door to the necessary but complex debate on the regulation of state aid, and with few commitments to the consolidation of markets, in this case, energy. It insists, undoubtedly, especially in the Affordable Energy Action Plan, on the need to configure a European energy market, but it already sounds like a litany given the absence of legislative commitments in this area.

Along with these strategic publications, the Commission published on February 11 its Work Programme for the current year, where it establishes the communications and legislative proposals that will see the light during this exercise. In general terms, the relevance given by the Commission to the "simplification" agenda stands out especially. If the Commission has already published a multitude of plans, in the legislative sphere we only have for the moment some omnibus proposals to simplify the implementation of different norms approved in the past legislature, almost all of them linked to the Green Deal. In this sense, the Commission sets itself the objective of reducing administrative burdens for all companies by 25%, a reduction that should reach at least 35% for small and medium-sized enterprises. Without going into depth in such a political commitment, it seems difficult to evaluate exactly what is meant by that numerical quantification of the reduction of administrative burdens and what these percentages respond to.

In this same package, the Commission revises the regulation of the Carbon Border Adjustment Mechanism (CBAM) to leave out of its scope small and medium-sized enterprises whose carbon imports the Commission now considers negligible, or at least, small enough not to justify the administrative costs of managing the CBAM and the payment itself of the tax for imported carbon.

Likewise, although without altering the legislative texts of directives or regulations, the Commission made public on the same date a consultation process to qualify the delegated acts derived from the Taxonomy regulation. On the other hand, in the second of the omnibuses, the Commission proposes to revise the regulation of InvestEU to also reduce the administrative costs of its operation.

Thus, so far, the Commission has presented different plans and strategies linked to a renewed industrial policy, and two legislative proposals focused on "simplification", which are now passing to the debate of Parliament and the EU Council in the framework of the ordinary legislative process.

On the other hand, and returning to the Work Programme, the Commission announces another legislative package of simplification for the revision of the Sustainable Finance Disclosure regulation, digital package and the European Business Wallet. Likewise, in other areas, the Commission also expects to propose legislative measures to simplify the REACH regulation and the Common Agricultural Policy.

In another order of things, and without intending to be totally exhaustive, the Work Programme of the Commission is completed with the commitments to publish other communications focused on energy matters, security and defence, migration and asylum, consumers and education, a plan on the implementation of the European Pillar of Social Rights, innovation, democratic strength, equality or LGBTIQ rights, among others. They also make reference to a strategy for the single market, a communication that should see the light in the second quarter, and another communication on the Savings and Investment Union, which gives continuity to the banking union and the capital markets union, following the nomenclature proposed by Letta.

In the area of competition policy, it is also worth highlighting the revision of the guidelines on the control of horizontal mergers, which, although it does not appear in the Work Programme, is included in the Competitiveness Compass, albeit without a committed date. In addition, the Commission also announces a new state aid framework for the second quarter of this year, which again appears in the Competitiveness Compass, but not in the Work Programme, which was published earlier. Similarly, the Commission also proposes a proposal on the "28th regime" collected by both reports, that of Draghi and that of Letta, for the last quarter of the current year or the first of the next exercise.

Finally, and in the chapter of community public financing of this entire reform agenda, especially necessary in the field of the new industrial policy, the Commission announces its proposal for a budgetary framework after the current period that ends in 2027 for the third quarter of this year.

Therefore, in legislative matters linked to the single market, we exclusively find in this work programme for the current year a proposal for a Digital Networks Act for the last quarter, which could develop some ideas to consolidate the current national digital markets. Beyond this, there is no legislative proposal to deepen the consolidation of any market. Certainly, the Commission announces a legislative revision of the regulations on securitisation that could hang from the communication on Savings and Investment Union, but the link of such a proposal with the Capital Market Union is rather collateral.

Well, following the conceptualisation of the proposals of Draghi and Letta under four major chapters, namely, simplification and reduction of administrative burdens, new industrial policy with affection to competition and commercial policy, public and private financing of the plan, and single market, it is easy to observe the dominant line of this Commission.

We are, then, facing a Commission that has decided to start the legislature with a very ambitious agenda of simplification of community regulations, in the current implementation phase, approved in the past legislature derived from the Green Deal, as well as in the presentation of new industrial strategies. However, we hardly observe a genuine pulse for the consolidation of the single market, to which little space and fewer ideas are dedicated in the texts known so far and which barely appear marginally in the legislative agenda for the coming months. This critically affects strategic sectors, but also the financing strategy, both public and private, of the reform package presented by Draghi and Letta. Not a single legislative proposal linked to the Savings and Investment Union, not a concretisation on budget, uncertainty about own resources, and nothing about public investment.

Perhaps all this contributed to the unusual and forceful assessment made by Draghi himself on February 19 in the European Parliament on the need to advance with determination in the marked objectives.

In any case, and beyond this initial comment, the Commission's plan leaves the financing of this industrial defence policy in the hands of the Member States, as in the previously published strategies. We also do not observe a European vocation to frame the increase in investment in coordinated plans that configure an authentic European defence, and not just twenty-seven better-financed national defences. Nor is an industrial policy proposed to give the business fabric of the sector a European dimension, nor ideas to facilitate its growth in the face of the strong increase in planned demand. The problem of defence is not only or essentially of demand, but in this case of supply, a supply that is reduced and nationally fragmented.

"The problem of defence is not only or essentially of demand, but in this case of supply, a supply that is reduced and nationally fragmented"

And again, leaving the budgetary responsibility in the hands of the Member States in a macroeconomic framework quite different from that experienced during the pandemic, now with higher inflations than then and public debts and national budgets already very stressed, in an environment of less degree of freedom for the European Central Bank, presents notable questions about the stability of debt markets, since the deregulatory agenda in the United States only increases the risks of financial accidents. Compute or not, in the procedures of excessive deficit, debt is debt.

In short, we still do not see in the Commission a pulse at the height of the circumstances to commit to an ambitious agenda linked to the single market, not even in defence, and an approach to the budgetary policy of the industrialist effort that is not commensurate with the challenges we face.