3 Jun 2014

Is Merkel still plotting against Juncker?

Reuters is reporting that Chancellor Merkel has asked President Hollande if he wouldn’t mind awfully proposing Christine Lagarde for the European Commission presidency.

Actually it may be that she broached the subject before the elections.

Chancellor Merkel is said to have been surprised by the EPP success in the European parliament elections. Back before the results, she thought she wouldn’t be in the position of having to support the EPP candidate for the European Commission presidency because the Socialists would’ve out-polled the right and would be putting forward their candidate, Martin Schulz.

The Managing Director of the International Monetary fund, Christine Lagarde addresses the Inclusive Capitalism Conference, at the Mansion House in the City of London

She could watch his demise as other countries opposed him with relative equanimity. A whole new contest would open up, with heads of government crunching a compromise deal that could see a right-winger as boss of the commission if the other bits of the jigsaw were satisfied to everyone’s taste.

She is not now able to distance herself so easily from the centre-right candidate because the centre-right won, because her own party campaigned for Luxembourg PM Jean-Claude Juncker’s right to the top job, and because she has a reputation for straight-dealing to protect at home.

The suspicion is that President Hollande isn’t wedded to Mr Juncker but could probably list a lot of good reasons why he shouldn’t nominate Christine Lagarde (pictured).

She may be George Osborne‘s pin-up, but Christine Lagarde is not such a huge name within France. Others regard this moment as their turn in Brussels. She’s not from the same party as President Hollande. It’s not clear she wants the job.

Critically, she occupies the jealously guarded top chair at the IMF. The body continues to play a central role in the Euro-crisis. There was great hostility to Europe getting that chair when it last became vacant, and South America and other parts of the world could be guaranteed to try to grab it if there was another vacancy.

And, of course, the last vacancy was caused by the early ejection of Dominique Strauss-Kahn. To lose your IMF seat once might be regarded as a misfortune, to lose it twice…

The G7 summit tomorrow in Brussels will give Chancellor Merkel and President Hollande the chance to discuss some more names with David Cameron and Italian Prime Minister Renzi. Agreement is not expected any time soon, but you wouldn’t put money on Mr Juncker right now.

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