EU Fights a Veto Threat Over Its Vital Budget: Brussels Edition

Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

EU leaders are due to have a tense and inconclusive video summit this afternoon. As the resurgence of Covid-19 pushes the continent back into recession, the effective veto by Poland and Hungary on the jointly-financed stimulus package agreed to in July threatens to delay the flow of funds into the region’s battered economies. Officials in Brussels say they’d be surprised if a solution is found tonight — or anytime soon. The crucial question that still needs to be answered: is this just posturing from Warsaw and Budapest, designed only to show their domestic audiences that they put up a fight? In this case, the spat will eventually be resolved after some symbolic concessions and unwelcome delays. The other possibility is that what we see now is the start of an inevitable systemic crisis, triggered by the determination of eastern European governments to push ahead with an illiberal transformation that the rest of the EU can’t possibly put up with.