Tuesday, May 8, 2018

GOOD TUESDAY MORNING. It’s Iran day today, according to a Twitter announcement by U.S. President Donald Trump. The French and German foreign ministers on Monday said they’ll stick to the nuclear deal “regardless of what others will do.” And a regular dinner among Commission President Jean-Claude Juncker, European Council chief Donald Tusk and NATO Secretary-General Jens Stoltenberg will come in handy tonight. They want to ease tensions in some NATO corners over the EU’s defense ambitions: There’s concern about an increase in defense spending in the Commission’s proposal for a new Multiannual Financial Framework. Some fear the EU wants to use money to influence the defense policy of the West (or what’s left of it). That would be a totally new concept, to be sure.

ITALIAN DRAMA

THE PRESIDENT’S PREROGATIVE: On Monday evening, Italian President Sergio Mattarella proposed a “non-political government” as the temporary solution to Italy’s post-election impasse. That move indicates he’s not going to give a mandate to someone who’ll run at the next election, whenever that may happen. Deciphering the president’s statement, there are now three options (and Mario Monti’s quite explicitly isn’t among them).

1. A presidential government that survives a vote of confidence, which stays in place while political parties sort out their differences and find an agreement for a new, political government.

2. A presidential government that gets parliament’s confidence and a built-in shelf life until December or so, which would be enough time to present a 2019 budget and possibly a new electoral law that Italian politics has been so obsessed with.

3. That presidential prime minister fails to get the votes in parliament, which would mean a very early election. Both the League and the 5Star Movement called for a vote as early as July, but Mattarella said a summer vote “has so far been possible to avoid” — indicating in presidential Italian that he prefers to keep things that way and not ruin Italians’ summer with tutti al mare. 

THE WINNER IS: While 5Stars leader Luigi Di Maio struggles for survival at the helm of his party, the real winner — who needn’t fear either new elections or internal uprising — is the League’s Matteo Salvini. POLITICO’s Jacopo Barigazzi lays out Italy’s new reality.

OF PUTIN AND POODLES

PUTIN’S VIPs: Guess who was standing in the front row at Vladimir Putin’s swearing-in ceremony? That’s right, Gerhard Schröder, the former German chancellor and current chairman of the board of Russia’s energy giant Rosneft. He traveled a long way (as did Putin) — and was rewarded with a handshake even before the country’s new old Prime Minister Dmitry Medvedev (though after Patriarch Kirill, to be sure; perhaps Syria’s Bashar al-Assad was busy?).

Schröder is from the SPD, as is German Foreign Minister Heiko Maas, who has tried to distance himself and his country’s foreign policy from his party’s traditional stance on Russia. Hardly veiling embarrassment, the German government’s deputy spokeswoman Ulrike Demmer declined to comment on Schröder’s participation but said Berlin is “concerned about the reports and the high number of injured and the arrest of minors” during protests against Putin over the weekend.

Friends like these: Schröder has called for the West to withdraw Russia sanctions. Late last month, 45 MEPs sent a letter to EU governments, the European Council and Commission, instead calling for them to be tightened, suggesting the EU should be as strict as U.S. Congress. The MEPs call on the Union to “start the necessary consultations both internally and with the United States aimed at synchronizing the lists of additional EU restrictive measures with those recently adopted by the U.S. Congress and Treasury Department, under the Countering America’s Adversaries Through Sanctions Act (CAATSA).”

That US list names some 200 Putin affiliates and includes the heads of the countries’ biggest companies from energy to banking (though much to the Wall Street Journal’s chagrin, not Schröder — it pays to be a former head of government). If adopted, the MEPs’ proposal would increase the risk of penalties for EU companies doing business with the people on the list. Let’s not even think about what it would mean for the planned Nord Stream 2 pipeline.

BUT ON TO THE POODLES: Parisians seem to have fallen out of love with them.

IRAN (VIA ITALY)

Our U.S. colleague Helena Bottemiller Evich writes in from our beloved Milan, where she attended “a relatively intimate dinner” Monday night held in honor of former U.S. Secretary of State John Kerry, who accepted a humanitarian award.

Advice for Europe: Kerry said the world currently “desperately” needs leadership, because “we are at a very pivotal moment globally,” with the U.S. battling “over the soul of our country.” He praised the Continent for its remarkable turnaround since World War II and had this advice: “Europe needs to believe in itself.”

On Iran: Kerry said walking away from the Iran deal, which “actually makes it impossible for a country to get a nuclear weapon,” would bring the world “right back where we were” when it “was not a safe place” because Iran “had the potential to build 10 to 12 bombs” in two months. Today, “they can’t build a bomb for at least 15 years — maybe longer.”

NOBEL TRUMP: British Foreign Secretary Boris Johnson reckons Donald Trump would deserve the Nobel Peace Prize if he can solve problems in Iran and on the Korean peninsula. But as the U.S. president prepares for an unprecedented meeting with Kim Jong Un to discuss eliminating North Korea’s nuclear weapons program, he has dropped the tough rhetoric and shown no sign that the human rights of North Korea’s citizens will play a role in the talks — much to the disappointment of human rights activists.

SOME POLICY

CARS! “It is of critical importance to consider the inevitable social impacts of the low-carbon transition in the automotive sector and to be proactive in addressing the unavoidable job implications,” a draft parliamentary report on the new CO2 emissions targets for cars says. The report, written by Maltese Socialist MEP Miriam Dalli (read it here), is the first EU legislative proposal we’ve come across that states that planned regulation will lead to job losses.

Show me the money: Dalli argues that EU countries should finance the necessary retraining of workers partly with the fines they collect from carmakers that don’t meet targets. The big question of course is what if producers do meet the targets and no fines are paid? Well, Dalli’s report sets much stricter emissions reduction targets (50 percent by 2030) than the Commission’s proposed 30 percent. The Greens are building support for a 75 percent slash, Parliament officials told my colleague Joshua Posaner.

Two things are certain: First: This won’t go down well in countries that have a relevant industry of some size (we’re not talking Malta here) and workforce affected. FAZ called Dalli’s plans “an attack on the car industry” when it first wrote about her report. Second: There’s little love for Big Auto in Brussels after the Dieselgate scandal.

AIR! The European Commission next week is set to send Germany, the U.K., France, Spain, Italy, Hungary, Romania, the Czech Republic and Slovakia to the European Court of Justice for violating clean air rules, EU officials told POLITICO’s Kalina Oroschakoff.

MONEY! Lili Bayer, author of POLITICO’s Budget Briefing newsletter, sat down with Karl-Heinz Lambertz, president of the Committee of the Regions. Spending on regional economic development in various forms makes up about a third of the current EU budget. Lambertz is concerned about the Commission’s proposed “substantial” reduction in cohesion funds in the next Multiannual Financial Framework, and believes the proposal amounts to “a 10 percent cut” rather then the 7 percent the Commission indicates.

The Committee of the Regions can’t veto the budget, but it has friends who can. The German länder, for example, can make life difficult for the federal government, let alone Belgian regions for theirs. Plus: “Our principal ally is the European Parliament,” Lambertz told Lili, adding that he will “fight for more” money. Not a Budget Briefing reader yet? Get yours here.

Might we add: The European Parliament indeed backs Lambertz’s analysis that cuts are deeper than presented. As always, it depends on which number you use, current or constant prices, and which year’s exactly. Parliament’s in-house research service crunched the numbers in the one way the Commission didn’t and compared overall spending proposed for the next MFF with the current one in absolute euro at 2028 prices. Outcome: There’s a gap between old and new of some €47 billion over seven years in cohesion programs (or actually about 12 percent) and of €61 billion in old-school agriculture subsidies (that would be a 20 percent cut).

The paper is here. It doesn’t take into account payments to British regions or farmers that will be nixed after Brexit, so the gap would be slightly smaller again in yet another way of doing the MFF maths.

BREXIT BRITAIN

UK’S SATELLITE THREAT FALLS FLAT IN BRUSSELS: London’s vow to launch its own navigation satellite system to rival the EU’s Galileo is ringing hollow on the Continent because any alternative is unlikely to match its value, reports our own Joshua Posaner.

GATHERING MOMENTUM: Tom McTague sits down with one of Jeremy Corbyn’s closest allies, Momentum founder Jon Lansman, who tells him how the movement is preparing for life after the Labour leader steps down. “Momentum will outlive Jeremy, no question. It’s going to outlive me. That’s my intention,” Lansman says, but insists Corbyn will not be quitting before the next election.