Do you have more infos on that ?? I live in france and the general message we keep hearing is that every nation is dealing with the crisis alone and that the european union project may die because of that.
I think this started without "order" from the central government, more as a result of direct action of hospitals in regions close the borders. It doesn't make sense to not help out when a hospital on one side of the border has free capacity, while another hospital a few kilometers away across the border currently has more patients than it can handle.
These 500bn are loans from the ESM. The part of that will go to support public healthcare will be without conditions, but the rest that will go to support the other parts of the economies will be given on conditions of austerity.
This agreement comes on the heels of the rejection of what 9 Eurozone countries including France had asked initially: A Eurobond, or coronabond as it made some headlines. That would have allowed the EU as an entity to borrow money instead of individual counties, but the governments of Germany and Netherlands seems that were against it.
Actually coronabonds would not allow the EU to borrow. It would allow individual countries to borrow with the guarantee given by all countries jointly. Those against it were mainly Netherlands, Austria and Finland, but Germany was not exactly a fan either.
See it this way: everyone knows Italian debt at 140% of GDP is unsustainable. Successive governments have promised again and again to do something about it, but then each finds a reason not to follow this promise. The Italian state is leaking money in all corners with many politically friendly businesses making huge gains at the cost of taxpayers. The default is mostly inevitable if there is not finally a serious attempt to address this issue.
Successive Italian governments have asked for mutualised debt - while increasing the national deficit and debt further each year. It would be crazy for any other government to give Italy a blank check and say "okay take whatever loans you need, wecll guarantee it". It means you are consciously taking up the risk of default for yourself while having no way to stop overspending or fix the underlying systemic issues. This means Italian governments have even less incentive to change the horribly corrupt and broken system.
That other countries say no is not a decision against the Italian citizens. It would be irresponsible towards their own citizens to take this up without some kind of real guarantee that Italy will finally fix the systemic issues, because the past 20 years of promises have been broken.
I consent this argument. Unfortunately there are parts of human nature that imo require checks and balances also with help in these circumstances. Any help money that goes to an actually unneedy person or business or is spent in unresponsible ways takes unnecessarily from others, either now or in the future. It‘s a fine line that shifts depending on the trust the acting parties have in each other.
However, these bad actors are everywhere, even in Germany are apparently cases like public servants sent home with full pay claiming help money or people making up fake lost businesses. So also there checks are increasing
That's not true, Italy's debit was slowly declining till 2009, the big financial crisis that originated in the US and it was mostly because of US bank and funds. after that there was a sharp increase but it then stabilised at least.
In my understanding there is only a blunt no to the coronabond, not a request fro more condition.
It was unfortunate that it started with Italy, and been the first with an outbreak like that in Europe push them to take brave decisions.
To me it feels more like that these countries don't want to help because they feel it's Italy's fault and they need to pay.
But what about all the money that was given for free to Germany to rebuild after the second war war, despite a long history of aggression?
It's not a surprise that people wants to break the EU, it's sad to see this project heading this way.
I agree on your points regarding Italy and the same applies for Greece, Spain, etc.
But the problem is that unless this happens on European level, providing loans to economies that for whatever reason have not yet recovered from the crisis of 2010 is only going to make things worse for them. Putting more austerity on these countries provides the perfect ground for movements in favor of Italexit and Grexit. If that happens won't it affect the Eurozone as a whole and, by extensions, the economies of the surplas countries?
In other words, can we afford not to deal with it at a European level?
Hah. There's much to be said about that fund. Only medical expenses are funded unconditionally, which is a fraction of the cost of this pandemic. As it stands, the countries of the South can look forward to a new wave of IMF/ECB imposed austerity, regardless of the disastrous effects it had last time...
