Ursula von der Leyen won a second term as president of the European Commission on the back of an ambitious list of promises for the next five years.
By securing enough support in the European Parliament on Thursday, she extended her executive to-do list and raised expectations across the EU’s political spectrum on a number of issues that have long frustrated Brussels officials.
Mujtaba Rahman of consultancy Eurasia Group warned that von der Leyen could be “setting herself up for failure” by offering commitments “that are not particularly coherent” to secure the support of a broad coalition.
Here we rank her boldest promises and most formidable policy challenges for her 2024-2029 term:
Is a capital markets union possible?
Von der Leyen on Thursday renamed the long-promised push to create a capital markets union the “European Savings and Investments Union” – but the new name doesn’t remove old obstacles.
The arguments in favor are huge. Von der Leyen estimates that the integration of EU capital markets, a decade-old project, could unlock up to 470 billion euros of private investment annually. This would generate much-needed private sector cash to help finance sectors such as defence, technology and the green transition.
But opposition to the pooling of national powers, such as market surveillance and corporate tax and bankruptcy rules, has so far proved immovable.
There have been recent attempts to revive political appetite, but it is unclear how he plans to break the deadlock. Softer measures such as a pan-EU investment product could advance, while key issues such as further centralized EU banking supervision remain contentious.
Can he build a European defense union?
In addition to creating a dedicated defense commissioner, von der Leyen also pledged to create a “single market for defense” and joint projects such as the “European Air Shield”.
Few member states disagree with the need to pool resources given the huge investment required after decades of spending cuts and the threat from Russia. But few are willing to delegate decisions about what equipment to buy, where to make it—or how to pay for it.
France and Germany have competing ideas for pan-European air defense projects; countries want to protect their domestic arms producers for reasons of national security; and interoperability—the ability of national armed forces to work seamlessly with one another—has long been a focus of NATO, with mixed results.
“Some may be uncomfortable with the idea,” von der Leyen said Thursday. “But what we should be uncomfortable with are threats to our security.
Will the competition rules be eased?
Von der Leyen said the overhaul of competition enforcement should focus on “innovation and resilience”, comments that reignited a long-running debate over whether Europe should loosen merger controls to allow bigger companies to flourish.
Its policy guidelines called for a “new approach to competition policy” that would “more support companies expanding into global markets while always ensuring a level playing field”. The guidance added: “This should be reflected in the way we assess mergers so that innovation and resilience are fully taken into account.”
This could mark a major political shift from the commission’s much-touted 2019 ban on a merger between Siemens and Alstom, which the German and French companies were pitching as a way to create a European champion in the rail market.
But officials in Brussels are skeptical that the remarks, which contained no commitment to legislation, will lead to much change in approach. Any significant move to ease restrictions – a position long championed by France and Germany – would face staunch opposition from pro-competitive capital seeking to protect small businesses.
Major member states including France, Germany, Poland and Italy asked for a review of the rules at the start of von der Leyen’s first term but faced opposition from 16 other capitals.
“I’m still trying to figure out which merger the EU has blocked in the past and which has prevented innovation,” said a senior EU official.
Should the EU budget be linked to the rule of law?
The head of the commission has pledged to make national payments from the EU budget conditional on compliance with the rule of law and structural reforms, while at the same time extending conditions such as compliance with democratic norms and fundamental rights to all EU funds.
“We will maintain a very clear principle in our budget: respect for the rule of law is a must for EU funds. In this budget and in the future,” she said.
The Commission currently has the power to withhold certain parts of EU cash due to rule of law violations. This provoked confrontations with Poland and Hungary, but was seen as an effective tool to halt democratic descent.
Applying even more conditions to EU funding will win the support of wealthier countries that want tighter control over shared cash, but are likely to be opposed by countries that see such moves as political blackmail and an intrusion from Brussels into domestic affairs.
Can Brussels help with housing and mental health?
In June’s European elections, voters, including many young adults, turned to far-right parties. They won about 30 percent support and led polls in Italy, France and other countries.
Centrist lawmakers, including those from von der Leyen’s own European People’s Party, believe the far right has successfully linked housing shortages to increased migration, appealing to 20-somethings who can’t afford to leave their parents’ homes.
Iratxe García Pérez, leader of the Socialists in Parliament, declared that “access to housing is a fundamental need of our citizens” and called for annual EU investment of 50 billion euros. But housing remains under the control of national or even regional governments, and analysts question how Brussels can unblock planning procedures in 27 countries.
Von der Leyen also highlighted how excessive use of social media is exacerbating the “mental health crisis” of youth and said she would tackle “excessive screen time and addictive practices” and “take action against the addictive design of some platforms”.
“We will fight the plague of cyberbullying,” she added. But while Brussels plays a role in technology regulation, law enforcement and screen time rules are national.
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