The Sound of Economics What should Europe pay for
Oct 1, 2025
Zsolt Darvas, a Senior Fellow at Bruegel specializing in EU budget reform, and Jacob Funk Kirkegaard, an expert on European public goods and defense spending, delve into the complexities of the European Commission's budget plan. They discuss the implications of shifting funds towards defense and research while questioning the effectiveness of current agricultural subsidies. The conversation explores how Europe can collectively address pressing issues like support for Ukraine and the challenges of financing public goods, emphasizing the importance of national contributions and the concept of 'own resources.'
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Refocus EU Spending On True Public Goods
- Bruegel argues EU spending should focus on areas where pooling at EU level adds clear value like public goods.
- Jolt recommends shifting farmer subsidies to national budgets to free about one-third of the EU budget for common priorities.
Budget Shift Toward Competitiveness And Defence
- The Commission shrinks agriculture and cohesion share and boosts competitiveness, defence and research.
- Merging and reorienting funds signals a structural shift toward cross-border public goods.
Merged Plans Risk Uneven Scrutiny
- The Commission proposes merging agriculture and cohesion into national partnership plans to reduce overlap and exploit synergies.
- Complex, country-tailored plans risk inconsistent evaluation and unequal bilateral bargaining by the Commission.