The EU and social policy

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The EU and social policy Frank Vandenbroucke University of Amsterdam Summer School KULeuven 12 July 2019 Inequality in Europe the USA compared US 1 4 EU27 3 2 0 9 8 7 6 5 Median income states (US ‘representative state’ = 1) Member States (EU MS’ European distribution: a moving scale Romania Denmark Top quintile 25% =>36% 123% =>125% 23% => 35% 132% =>132% 21% =>33% 139% =>136% 17% 28% 144% diversity welfare Input: expenditure on protection gross % GDP (2016) 35 30 25 20 15 10 FR FI DK AT BE SE IT NL GE GR UK PT ES SI LU CR PL CY HU CZ SK BG EE MT IE LT LV RO old age & survivors Sickness/Health Care Unemployment Disability Family/children Housing Social Inclusion n e c Other adm costs Output: two-dimensional map 24 22 18 16 14 44 49 54 59 64 69 Employment Rates 2016 (population 15-74) states: poverty Poverty risk threshold: “national” conception (SILC 2017) 000 AROP total population SILC 2017 threshold PPP performance dimension project according to founding fathers: belief convergence • integration would support simultaneous pursuit economic progress cohesion both within countries (through gradual development states) between upward across Union) Initial division labour: – development: supranational coordination security rights anti-discrimination: national sovereignty (in theory) machine worked… more or less… until 2004/2008 A tragic dilemma enlarged heterogeneous EU? Monthly minimum wages: disparity but East-West 500 2004 Reconciling openness domestic cohesion: political challenge Openness mobility must not exert downward pressure level (minimum wages entitlements assistance) Access benefits: general principle non-discrimination exception: posting workers We do see ‘benefit tourism’ Posting needed reform Transparency coverage wage regimes Minimum what governments can do: net disposable couple with children one minimum-wage earner 45000 40000 35000 30000 25000 20000 15000 10000 5000 DE EL Net Gross Source: CSB/MIPI risks < 60 by work intensity household 70 50 40 Very high High Medium Low low Work 2004-06 Bron: Eurostat 2005-2007; year T refers observation T-1 except for Increasing inequality poverty: diagnosis lessons There is no one-size-fits-all explanation hence silver bullet tackle increasing inequalities need set complementary strategies instruments that improve employment perspectives households weak attachment labour market Improving our human capital requires child-centred investment strategy addresses opportunities should promote policies (Vandenbroucke Rinaldi) Division EU)? Design flaws EMU as an insurance union: vaccination metaphor Why are stabilization centralized monetary unions? Risk sharing (pooling) Externalities public good (vaccination) Vaccination: compulsory requirements) subsidized (re-insurance) requirements effective stabilisation capacity: sufficiently generous unemployment benefits notably short-term; sufficient rates benefit schemes; segmentation leaves part force poorly insured; proliferation relations integrated into insurance; activation unemployed individuals; budgetary buffers times so automatic stabilisers their bad These principles become fortiori imperative if Eurozone be equipped re-insurance systems: institutional moral hazard EMU: needs common standards resilient shared flexibility Labour institutions deliver (effective collective bargaining) Cluster adequate capacity MS: insured against unemployment; systems individuals  Convergence some key features Pillar Rights Gothenburg Summit 17 November How Rights? Clear priorities Credible roadmap combining… legislation Policy benchmarking Funding (tangible MS) Mainstreaming fiscal surveillance Semester Completing union Union systemic functions (e g fair corporate taxation …) guide substantive via objectives leaving ways means basis operational definition ‘the model’ cooperate explicit purpose pursuing pan-European based reciprocity Resources (1) Addressing Global Inequality: Is Part Equation? in: Diamond (ed) Crisis Globalization: Democracy Capitalism Twenty-First Century I B Tauris London New York pp 235-258 (download www frankvandenbroucke uva nl) 2) puzzles paradoxes Boone Marc; Deneckere Gita Tollebeek Jo (eds ) End Postwar Future - Essays Ian Buruma Verhandelingen van de KVAB voor Wetenschappen en Kunsten Nieuwe reeks 31 Uitgeverij Peeters 2017; download nl 3) Rinaldi In: Vision Consortium ): Redesigning Ways forward Gütersloh http://www vision-europe-summit eu/ (2) 4) cross-border Sticking may yield better practical results everybody Tribune Notre Institut Jacques Delors June 5) Barnard De Baere after Cambridge: Cambridge Press September https://doi org/10 1017/9781108235174 (Introductory chapter Open item 263) 6) Commission Recommendation COM(2017) 2600 final 7) Rights: from promise delivery –Introduction ‘European (ESU) forum debate’ EuroVisions December 2018 + other contributions this debate: euvisions frankvandenbroucke_uva