On Wednesday the European Commission will present a giant stimulus package to meet the looming economic downturn -- with an estimated €130 billion in initiatives. But Brussels has neither the money nor the ability to forge an economic program. The situation is getting serious. Europe's industries are running out of contracts. Economists predict that next year will bring reduced working hours and layoffs and that times will get bleak. The US Federal Reserve and Treasury Department on Tuesday announced a new package totalling $800 billion to make it easier for small businesses, students and home buyers to borrow money. And in Europe, state economic stabilization policies that fell out of favor long ago have suddenly found many new backers. European commission President Jose Manuel Barroso On the European Commission, where European President José Manuel Barroso and 26 other commissioners direct the business of the European Union and where "the market" has been viewed as the best force to steer the economy for a long time, "the state" was supposed to keep its fingers out of everything. Now it's all different. The states -- or, more precisely, their taxpayers -- have just been forced to rescue the global banking system because its leaders proved to be little more than incompetent gamblers. Now more tax revenues are supposed to avert -- or cushion -- a threatening crisis in the global economy. Taking their places at the head of this phalanx in the fight of "politics against recession" are Barroso and his commissioners. They plan to bring forward an enormous economic program on Wednesday full of prescription for battling the crisis. "Temporary cuts in value-added (or sales) tax" is one of the proposals that could be "quickly implemented to give a strong fiscal impulse to promote consumption," reads one of the proposals. Additional caps should also be placed on the value-added taxes for certain labor-intensive services, like those performed by tradesmen, cooks or waiters. The Commission also intends to give tax concessions to especially climate-friendly products and to lower income taxes on low-income earners.
On Wednesday the European Commission will present a giant stimulus package to meet the looming economic downturn -- with an estimated €130 billion in initiatives. But Brussels has neither the money nor the ability to forge an economic program.
The situation is getting serious. Europe's industries are running out of contracts. Economists predict that next year will bring reduced working hours and layoffs and that times will get bleak. The US Federal Reserve and Treasury Department on Tuesday announced a new package totalling $800 billion to make it easier for small businesses, students and home buyers to borrow money. And in Europe, state economic stabilization policies that fell out of favor long ago have suddenly found many new backers.
European commission President Jose Manuel Barroso On the European Commission, where European President José Manuel Barroso and 26 other commissioners direct the business of the European Union and where "the market" has been viewed as the best force to steer the economy for a long time, "the state" was supposed to keep its fingers out of everything. Now it's all different.
The states -- or, more precisely, their taxpayers -- have just been forced to rescue the global banking system because its leaders proved to be little more than incompetent gamblers. Now more tax revenues are supposed to avert -- or cushion -- a threatening crisis in the global economy. Taking their places at the head of this phalanx in the fight of "politics against recession" are Barroso and his commissioners. They plan to bring forward an enormous economic program on Wednesday full of prescription for battling the crisis.
"Temporary cuts in value-added (or sales) tax" is one of the proposals that could be "quickly implemented to give a strong fiscal impulse to promote consumption," reads one of the proposals. Additional caps should also be placed on the value-added taxes for certain labor-intensive services, like those performed by tradesmen, cooks or waiters. The Commission also intends to give tax concessions to especially climate-friendly products and to lower income taxes on low-income earners.
Plans for a £160bn economic recovery package were unveiled by the European Commission today. The proposals - equivalent to 1.5 per cent of the combined wealth of the 27 EU countries - is not meant to be a "one-size-fits-all" strategy to tackle the financial crisis, insisted Commission President Jose Manuel Barroso. Instead Brussels wants EU governments to step up coordination of their national efforts to counter the downturn. Mr Barroso said national plans unveiled so far - including UK Prime Minister Gordon Brown's VAT-cutting package this week - were in line with the recovery goals set out at a "G20" crisis meeting in Washington earlier this month, and would be considered as a contribution to the EU-wide effort being called for today.
Plans for a £160bn economic recovery package were unveiled by the European Commission today.
The proposals - equivalent to 1.5 per cent of the combined wealth of the 27 EU countries - is not meant to be a "one-size-fits-all" strategy to tackle the financial crisis, insisted Commission President Jose Manuel Barroso.
Instead Brussels wants EU governments to step up coordination of their national efforts to counter the downturn.
Mr Barroso said national plans unveiled so far - including UK Prime Minister Gordon Brown's VAT-cutting package this week - were in line with the recovery goals set out at a "G20" crisis meeting in Washington earlier this month, and would be considered as a contribution to the EU-wide effort being called for today.
The European Commission has called for an EU-wide stimulus package worth €200 billion, the equivalent of 1.5 percent of the bloc's GDP. Brussels has even pledged to be flexible on member states increasing their budget deficit. The European Union Commission has approved a huge stimulus package aimed at reviving the bloc's struggling economies. The €200 billion ($260 billion) plan will represent 1.5 percent of the EU gross domestic product (GDP), with around €170 billion coming from national governments and the rest from EU funds and the European Investment Bank.
The European Commission has called for an EU-wide stimulus package worth €200 billion, the equivalent of 1.5 percent of the bloc's GDP. Brussels has even pledged to be flexible on member states increasing their budget deficit.
The European Union Commission has approved a huge stimulus package aimed at reviving the bloc's struggling economies. The €200 billion ($260 billion) plan will represent 1.5 percent of the EU gross domestic product (GDP), with around €170 billion coming from national governments and the rest from EU funds and the European Investment Bank.
BRUSSELS: The European Commission on Wednesday proposed measures totaling €200 billion, or $260 billion, to revive the region's flagging economy. The commission, the executive arm of the European Union, said in Brussels that the measures were necessary to bolster growth and employment in the EU's 27 member countries. Just Tuesday, the Organization for Economic Cooperation and Development predicted that the 15 countries of the euro zone would contract next year by a combined 0.6 percent, and economists have begun speaking of 2009 as a "lost year." The stimulus plan was larger than many economists had expected. It calls for spending of "around €200 billion" or 1.5 percent of EU gross domestic product. The vast majority - about €170 billion - would come from member-government spending, much of which has already been announced. The remaining €30 billion is to come from the budgets of the EU itself and the European Investment Bank. "Exceptional times call for exceptional measures," José Manuel Barroso, the commission president, said at a press conference in Brussels. "The jobs and well-being of our citizens are at stake. Europe needs to extend to the real economy its unprecedented coordination over financial markets. This recovery plan is big and bold, yet strategic and sustainable."
BRUSSELS: The European Commission on Wednesday proposed measures totaling €200 billion, or $260 billion, to revive the region's flagging economy.
The commission, the executive arm of the European Union, said in Brussels that the measures were necessary to bolster growth and employment in the EU's 27 member countries. Just Tuesday, the Organization for Economic Cooperation and Development predicted that the 15 countries of the euro zone would contract next year by a combined 0.6 percent, and economists have begun speaking of 2009 as a "lost year."
The stimulus plan was larger than many economists had expected. It calls for spending of "around €200 billion" or 1.5 percent of EU gross domestic product. The vast majority - about €170 billion - would come from member-government spending, much of which has already been announced. The remaining €30 billion is to come from the budgets of the EU itself and the European Investment Bank.
"Exceptional times call for exceptional measures," José Manuel Barroso, the commission president, said at a press conference in Brussels. "The jobs and well-being of our citizens are at stake. Europe needs to extend to the real economy its unprecedented coordination over financial markets. This recovery plan is big and bold, yet strategic and sustainable."
