or are they and i mean you see. the future of the future if you interpret if you wish you would go with me but it is you should look if he's going to give me my debit card for i chip almost trump and flooding your i were to park complementary analyzers the difficult relationship between russia and the west and between their presidents how does their rivalry and their dangerous mutual admiration for the rest of the world to some bullies trump and putin starts august 3rd own d w. it's being hailed as a pivotal moment for europe e.u. leaders agreement on a 750000000000 euro carona recovery package after a marathon 4 nights of heated negotiations the leaders struck a deal to provide 390000000000 euros in crowds and another $360.00 on low interest loans to member states hardest hit by the pandemic it will be financed by

collective borrowing a paradigm shift for the e.u. will the deal hold the euro zone together or have member states simply papered over the cracks in europe's foundations. carona recovery deal can the e.u. rebound that's our title. on. the economy. and it's a pleasure to welcome our guests eric is an american journalist who has written for the los angeles times amongst other media outlets and he says the summit exposed once again how much disunity there is in the european union. and we're very glad to have with us puzzle took of took our ski he took our ski excuse me he is a polish economist and senior associate at the german institute for international and security affairs he says we must. story form the member states now or will face

the same problems again with less time and fewer instruments. and great to have with us once again that casting family and she is deputy editor in chief as the parliamentary bureau of the german newspaper sayto and she says the deal is far from perfect but it is a signal that multilateralism is still alive. and let me start with you cast him and ask for your take on the big picture there are a lot of surprise being thrown around here a historic a breakthrough chancellor merkel saying it's a huge step for the e.u. would you agree with all that i would say yes it's a huge step forward for drummond and also for do you because germany basically changed my mind and giving out. and offer loans but i would not miss all these people that are saying it's now a historic moment because i think history is right. on the path to form the form to

future so historians will have to travel to it was historic for the moment now it is a big problem how would you see it as an economist is the most significant moment to you print a comic integration since the creation of the euro because so far we've heard. financial systems which consist of loans no we hear for grants so those gone so quite some substantial do something droned 750000000000 fuels however from the comic respect for mo i think that the most important things will be doing long be able to start loves the bull market. thank you very much and we'll come back to that point a little bit later on eric how would you come down on this historic or less so what we just heard from pavel indicates it is indeed a very very big step how do you see all the mutualization of debt for the 1st time is a big big step it's something that was long overdue the e.u.

could have done this a decade ago the eurozone crisis might not have been severe as it was but on the other hand 5 days and 5 nights of negotiations for this deal that could have been done in a day is a bit of a farce and it just showed the e.u. the e.u. is far from you know united in with the problems facing the e.u. and facing the world it's not really. making a very fit for the future when they take 5 days to get a decision like this done if i may say that i mean do you if it's united otherwise you would not have a deal i mean i agree with you it was really very difficult 5 days and 4 nights to negotiate a small sign and but i'm sorry by the end does it do you think i'm black i don't congress and abroad they never manage to make a deal and yes the un made by 27 national member states when last big picture question to you pavel before we take a look at some of the details of this deal it was a compromise as both essentially have have conceded with significant tradeoffs made

by pretty much all interested parties the question is whether the result justifies those concessions of course just as far as they're called concessions on the we have to bear in mind that to be fair if in the in the u. turn to serve a different member states with different size different the comic systems and for some of these member states is really a huge step forward like from the netherlands before them to go on to do come on debt to come come on the government come on the transfers which would go to the south so this is huge step forward to reach nobody in those compass expect that the police of this comes will have before us criticism at home so let us in fact now take a closer look at the corona recovery package and those north-south divisions that it provoked. it was clear they'd be a fight over the 750000000000 euro recovery fund and it exposed deep roots within the e.u. countries like italy and spain who have been especially hard hit by the corona

pandemic were timed to counter resistance from countries like the netherlands and austria that would prefer to save money to marathon negotiations they reduce the amount of direct and to $390000000000.00 for the 1st time the a you will issue common debt despite all the haggling the current president of the council was pleased. and i think this is a clear signal that goes beyond europe that this very special structure this very special entity a european union consists of $27.00 member states that can act together despite their very different backgrounds and have proven they have the capacity to act that is a good sign. but that's. not. what is the deal actually worth. you talked in your opening statement about the disunity exposed by the deal in fact there were

moments where it looked as you said of course the 5 days as if there might not be a deal would you say those north south divisions will leave lasting scars absolutely it's not just north south now it's east west we saw small groups of eastern european countries able to blackmail their interests we saw the small frugal zabel to force their interests through the e.u. used to be led by france and germany kind of leading the way and people are getting away with in the wake of britain leaving the e.u. smaller countries are coming up with their special interests and it's a scary moment if you think the world where the world's going with china the united states these big power blocs in the e.u. here in the middle with 27 countries having over small little details is the e.u. going to be able to compete with these big countries in the world of the future. yeah i what i am i am i'm sorry but i it's totally different actually of what i see does is bruv that liberalism is still alive i mean 27 member states make a deal and it's sure it took

a very long time and you still have to division between south and north and east and west draw but i mean to special situation you know was did no money on to march germany was in one line with the madeleine's austria and these little countries that say day on froogle so actually the german he was the leader in saying austerity and after the crisis suddenly there was a change in german politics and a big change so a german he stepped away from a story. and went to the 2 for 2 fronts again and then they had 2 strong french drome and motorola that basically came out with this proposal to deliver 500000000000 in grants. and this was a big change i mean we were in fact told by the german press at least that the chancellor seemed to be favoring the colors of the tricorder treacle are there yet sure red white and blue yet would you say that there is

a lasting change here to the balance of power in europe in part due to chancellor merkel's decision to go to the other side i mean you see clearly a dad wanted me instead put to me it's not here anymore because great britain was also balancing as a big power the european decisions and i would not be sure that as a permanent shift from germany. to do it to decide off decisions and countries of the south and become trees but on. the other side i would say desk no i try to really watch what germany do i mean dollar for big. economies now are left over in europe in union and they have to stay together otherwise the european internal market which is by the way the biggest in the in the road to break away. probably limit let's talk a bit about some of the economic details of the situation in which europe finds itself before the countries went into the summit the leaders went into the summit

there was a lot of talk about the eurozone survival being at stake largely because of the divergence between northern and southern economies if we look at the current numbers germany the netherlands it looks like they're going to see an economic contraction this year of around 6.5 percent spain and italy or more are almost double that so will this deal now close that gap the head of the european central bank has said that gap is putting the very survival of the euro in danger do you think the deal will get money to those southern countries in such a way and quickly enough that it can close that divergence. i fully agree that the diversion in multan not only do you really have a special single market is a very. very bad thing and what's changed the minds of the leader of the summit i think it was the threats above the. interests of the single market but some comes

from a softer call in a crisis actually developing. and the pop of these things in those come through scum actually change the political alliance of those countries so the economic divergence can cause social lot of divergence and social they've there's a version can have a vote in the got to impact on the political unity of the you know and i think that's although they do it on those 2 did very well and that's why we have this decision at the summit so let me ask you this eric. the dire economic prospects that are facing the southern european countries are not only of course due to corona they were macroeconomic weaknesses in spain and italy and elsewhere that preceded the crisis the kugel 4 were determined to make sure that this recovery package essentially helps to remedy those macroeconomic weaknesses by imposing what's called conditionality do you think that we will see true reform on

the basis of this deal i think they have to and i think the reason germany switch sides and was suddenly in favor of collectivizing debt is because merkel realized this is the corona is a one time thing it's an exceptional circumstance the problems with coronas not only because of the economic problems they're having before as you also realize piling more debt on these other states was going to drive them into into really dire straits so this is a one off perhaps we'll see but i think miracle also realized it was the right thing to do and there will be controls now the netherlands push this through that they will control with the conditionality make sure the money is being spent on. things to help mitigate the impact of corona so if you're a frugal person you have to say well ok we'll see how this works. not a bad deal could have been better but at least this will go for corona related issues next year america will be gone it's unlikely another conservative chancellor

would do this again so i do think this is a one off this will be going to the credit crisis and hopefully the money will go to the right places in these countries to help them overcome the credit crisis kister $1.00 of the points of criticism for some observers it's what is what they're calling the governance architecture of this deal meeting those conditions that i mentioned that are supposed to ensure reform in the southern european economies that they're going to be essentially overseen by other e.u. leaders not by the institutions in brussels but by the european council itself isn't that a recipe for ongoing divisions and delays it is i must say because it is actually possible that the different member states can tend to follow him and that different country what kind of shape they have to do and what kind of reforms to have to do i mean do you opinion in all member states us of oil and national states and it's

actually on possible that another state can tell you what to do on the other hand and i think that that was the reason why they had to find a compromise i mean taxpayers from all of. us states hunting these grants and debt it's a common debt in a way and that means also that german taxpayer us. taxpayers from the netherlands want to make sure that the money that this now on the table that would be spent on the life of a and i think it is also a common understanding that there has to be a kind of control and probably your opening statement referred to the need for reform in member states do you think this condition now. he is going to do the job . i don't know is difficult to say because we will have the extreme time pressure the member states will have to pick programs to get the money in the very short time and those programs will be also is by the group in commission and by the member states so it's. difficult to say what kind of quality of does project will

be and where the money will be spent the money. deficiences most holding european come through that is going to be a challenge let me come to a different point all of you have mentioned the provisions for common debt basically the idea is that much of this recovery package will be financed by borrowing on the financial markets by the european union commission now when that proposal was 1st made to eric. the german finance minister referred to it are essentially made the analogy to the so-called hamiltonian moment for you and me as americans i think a lot of us know about that moment because of the musical hamilton but let me just remind our visitors it was the moment in 1790 when the very 1st treasury secretary of the united states persuaded those nascent american states still very young to accept kamen debt that essentially was the 1st step toward u.s.

fiscal integration which is made the u.s. an absolute powerhouse also one international financial markets is the same thing happening here. no this is a very very small step in the right direction but a small step in way too late that was 1719 the united states was able to florida blossom because of that promise and the promise to pay back all that debt the united states has always paid back the money it's borrowed and that's why the u.s. is such a great creditor and the e.u. has been hemming and hawing about this question for 2 decades now the euro's been around for 20 years but there's no collective debt and that's the fundamental flaw the fundamental weakness of the euro and the new. about this 10 years ago when the eurozone crisis flared out of them and talking about it ever since and now they're taking a small very baby step towards the hamiltonian moment hopefully it will be there will be something that will bring bring they give the euro some some power but i'm skeptical i doubt it's more than a one off in the head on

a moment if i could just say this play out on the moment wasn't actually a moment it was a process of fiscal integration that went on over decades into still not finished in the u.s. yeah and i think the 1st 5 last introducing off the euro navi have to 2nd step of starting with a common depth and i think we have to take a decision on your past so take the decision of either david continue and out today and also the next chancellor who whoever that may be perhaps it's a green one you have never know her but you have to decide do we go straight on this way or do we stop and then we have to give up also does common currency i think the idea at the point that they have to take a decision which betray public and i get you to weigh in very quickly on the coming debt is yours i would like to remind this is not the 1st time to use the suring debt. you will see sure in the depths of the last 10 years but that is going to be the biggest as you know he was in small amounts only for loans and before the 1st

time that is issue in the programs so this is this is new and the question is if we are the conditionality of that will be stronger for us and sultan go up to actually use this money properly because for someone to be the last chance to reform the comes from there would be no 2nd chance so a lot riding on this and a lot riding on another aspect of the deal as well it wasn't only north-south tensions over frugality that nearly torpedoed the negotiations at the summit so too did east west divisions over linking e.u. funding to recipient countries compliance with european principles and democratic values and rule of law here's more. the text that has been agreed on the rule of law has improved. it's a very clear in the document a very clear commitment to the rule of law and a very clear commitment to the protection of the financial interests of the union

and the rich try to make a connection between the rule of law budget. laws. was successfully rejected. so kasten pretty contradictory assertion is that they're also left on their law in viktor orbán who's right it basically everybody did the course we have to close now in this statement off after them it that they say ok we have to put the paying $2.00 off law to a 4 cylinder roll off law by desk a little 2nd sentence which says ok but the member states have to decide so basically it was a laugh on the line described by saying ok we dedicated our money to to guarantee that the states that didn't get the money. in line we saw a lot by death also some truth which is

a going to direct it but he can veto such a decision. let me ask you again your opening state statement talked about the need for reform and also your concern about whether there are enough instruments in the toolbox of the e.u. to compel reform now your own country poland has been under ongoing pressure from brussels for its effort to undermine the independence of the judiciary will this deal change anything i don't think that through state change on this ng unfortunately you has no real instruments to influence comes just like poland and hungary. you budget your finances fortunately we can still went to that in the last budget to do it in the last. financial firm a quick trip to similar instruments so-called micro konami conditionality to influence the economic basis of member states and it's proved to be actually toothless so i don't think that's during the next 3 years that you will be managed

to stop of coaches could to further destroy the pollutions 2 things let me just follow up on that there are also currently legal proceedings ongoing with european union member countries that have not complied with role of law and those are not yet resolved taken together if they were resolved against the countries if they were found not to be in compliance together with what is it least now a principle of linkage in this deal could that start to change things i don't think that the current government in poland to be making 2 step for was on the way to destruction of the rule of law in one state because when the pressure from the brussels is really high. again the president of the room votes you want elections some questions he has a full public palumbo and you can do everything he wants with the judiciary from

started next step will be the pollution of the middle eric you haven't been overly optimistic so far about the agreement would you do differ without a gnosis or do you also think this is toothless i think it's a nightmare that these eastern european countries were able to water down things and countries that are trampling on. the state his rule of law limiting press freedom limiting judicial freedom it's a worrisome development and they got away with it and you know how can everybody there be a winner how can all 27 countries walk away as winners i don't get it there's always a winner and there's a loser but they all claim to be winners of the e.u. summit if i bring i've if i can never very easy if you imagine trying to 7 families are living in a big house just when. 7 apartments so everybody that owns an apartment has its own bottoms so do you some europeans have i don't know problems with sivin though they have problems as design by counties and on the basements they have also problems i

don't know with the water coming in and everybody is saying oh this is my biggest problem yet and so at the end the 27 old us off these apartments in the big european house agreed on the blend that just dedicated to fix the whole house that it didn't happen or not is that there's one question but display and basically helps to fix the house and in that way everybody can be given a because everybody everybody can still listen that tower or one of those boners can block the whole thing and that's the whole we know if i was over so far not because everybody else to 7 sign disagreement after off. the whole thing let me let me ask you for me as a lawyer this is a big provision i grant that the conditionality relating to rule of law yet it is now in a document that will have a certain legal value going forward does that not establish some kind of lever that could perhaps be strengthened over time could be it could be that exactly that

didn't happen but we have to see that i mean i think that was the best they could get out it's not beat idea far from ideal but it is a deal perhaps that and perhaps if the water is drowning in they do more with this deal still has to be approved by the e.u. parliament do you think we'll see any changes i don't think that when it changes because the government just broke that this money just recently but bob the prognosis is very broad so they will be very happy to receive just 160 the new rules so very briefly i want to come back to our title the question was will this help the e.u. rebound gave us the great analogy of the common house would you say the foundations are at all stronger through this this deal. yeah the collectivization of debt was a big step forward and that's something to cheer about they still have to vote on the house so. i don't knock out you know the question altogether he's thinking you

more resilient i mean do you know a side of that summit is that the e.u. is still existing. rather it's more lesson. from the come up perspective is definitely more resilient or have the e.c.b. intervention shift. on the top of your package which make. possible economic crisis or the crisis. for the probable it's often said by you leaders that it's time for europe to speak with a common voice and to play a stronger role in the world does this deal help it at all to do that well when the e.u. is getting stronger than the final teams would be your have a stronger voice in those shrink also increases their international the importance of the common currency so slow savory. thank you very much to all of you for being with us for this discussion thanks to all of you out there for tuning in the use of .

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i'm not laughing at the gym i just sometimes i am but i stand up in winter that the german thinks deep into the german culture of looking at the stereotype a question that isn't the future of the country that i now know i'm playing. the piano needed to be picked for this drama play out. it's all about ok. i'm a joke join me to meet the germans on the w. . coast like. oh. my god says i was sued for the russians so. there are still. so many different walks of life. some are. oddly tried but all of them come straight from the heart to explain or see you but one has no more delusion the march will enjoy. the most of the lot to their

final resting place the russians are g.w. documentary. play. and play. play. this is due to the news life for a star. first on both are just sophia. for the 1st time in nearly 90 years the building opens for muslim friday prayers we have the latest on president edouard's controversial decision to change the status of the world famous monument also coming up. china or does the closure of the u.s.

consulate in the southwestern city of chengdu the move comes after the u.s. told the chinese.