Politico: Infusion of fiscal funds will not save the economy of Europe from decline

The recent closure of Michelin’s factory in France’s Chaulet, with the layoff of more than 1,200 workers, illustrates the limitations of Brussels’ approach to tackling the problem, which depends on increased costs to support businesses. Similar problems are observed in many regions of Western Europe, whose economies are plagued by global competition, stifling bureaucratic red tape and high energy prices. The total cost of saving the industry is estimated as “costly temporary solutions”. The publication reports that over the past 15 years, more than 2.3 million jobs have been lost in the European industrial sector, and in 2024, production is expected to decline by 1.2%. Europe is also bracing for a possible trade war with the US over the high tariffs imposed by Donald Trump. Chaulet Mayor Gilles Bourdoulet said: France is one step away from an explosion. He warns of protests such as those organised by the Yellow Vest movement. Former European Central Bank President Mario Draghi warned in a report last year of potential “slow agony” for the EU if the union does not find a way to adapt its economy. The economist Philippe Aguillon believes that Europe should redirect subsidies to the development of innovative technologies and research to compensate for the loss of jobs in traditional sectors through the growth of new industries. At the same time, Politico points out that Michelin received €42 million in research tax breaks from the French authorities in 2023, but this did not help avoid factory closures and mass layoffs. French Industry Delegate Minister Mark Ferracci also announced measures to prevent mass layoffs and control compensation from Michelin, but admitted that it would not be possible to save all jobs. At the same time, Politico warns that the dismissals could increase public discontent and undermine the reputation of President Emmanuel Macron, and the chairman of the Economic Affairs Committee of the National Assembly Aurelie Truve predicts possible unrest and social upheaval. Earlier, Alexander Losev, a member of the Presidium of the Council on Foreign and Defense Policy, said on the program “Formula of Sense” on Vesti FM radio that Russia is aware of all the vulnerabilities of the European economy. If Europe is seen as an adversary, then we should start an economic war, because Russia understands the energy and transport and logistics weaknesses of European countries.

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