Proposed $825 Billion Coronavirus Rescue Plan Gives Brussels New Tax And Spending Powers

Proposed $825 Billion Coronavirus Rescue Plan Gives Brussels New Tax And Spending Powers

European Union leaders’ proposed $825 billion coronavirus rescue package could help Brussels recover from the economic impact of the coronavirus pandemic. The fund might give the bloc new tax and spending powers.

Europe’s ‘Hamiltonian moment”

The new initiative is known to the proponents as the “Hamiltonian moment,” inspired by the 1790 agreement made by Treasury Secretary Alexander Hamilton, that paved the way for the United States to reach true federation run by a central government.

The plan is expected to unite the coronavirus-separated EU

The plan allows the EU’s central government to gather and distribute funds to the bloc members. Brussels could provide grants amounting to $550 billion to the other member nations hit hard by the novel coronavirus pandemic. The other part of the collection might be requested from the central government in the form of loans.

European Commission President Ursula von der Leyen announced the initiative at the hall of the European Parliament. She said that the EU should walk the road together, leaping forward as they pave a strong path for the people and the next generation.

Germany’s change of heart paved the way for the proposal

The European Commission president emphasized that the plan is a one-time crisis measure to calm fears of those who are skeptical of tighter integration. The integration plan followed Germany’s change of heart, encouraging unity, and abandoning old constraints.

Europe’s most powerful economy had a strong stand against opening the nation’s bank accounts from other members of the bloc.

Recently, Chancellor Angela Merkel shifted the nation’s stance, encouraged the EU for unity, and offering loans in vast quantities to be given to poor nations. The Chancellor announced that she would step down when her term ends next year, but her ability to deliver will remain as her legacy.

Wolfgang Ischinger, a former German ambassador to the United States and the current head of the Munich Security Conference, commented that it was a question of the survival of the European Union. He said that fund is not merely a gift which they give away because they like their neighbors so much.

He added that it’s about assuring the survival of the European project to which Germany has now been attached to for the last 70 years. He also said that they are not going to let their political future fall apart.

Will other nations agree to the plan?

Member nations of the bloc always differ in opinion over almost everything. The economic rescue plan still needs a unanimous approval of its 27 members. Austria, Denmark, the Netherlands, and Sweden want to confine the fund to loans with strings attached.

Tension is growing between member nations of the bloc because of the pandemic. Italy and Spain were among the nations hit hard by the coronavirus pandemic, killing thousands of citizens. The two nations complained that the bloc never came with aid during the onslaught of the deadly virus. Rome felt abandoned when Germany and France banned the export of medical equipment.

The approval for the new initiative might face a rough road before all nations unanimously agree.

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