The EU reacted swiftly to the economic dimension of Covid-19 by designing new instruments to support the fiscal policy of Member States. But entry into force and implementation was slow due to various political hurdles with little action taking effect by the end of 2020. While EU legislation is underway to allow improved crisis responses, we argue that this legislation may actually be inefficient and detrimental to important EU policy objectives. We show that such EU support would have benefited only the wealthiest Member States. More generally, well-intended EU-funded stabilisation measures may actually be counterproductive in terms of EU cohesion, suboptimal in terms of stabilisation and regressive in terms of cross-country income distribution. By contrast, in China governments at all levels spent over 400 billion yuan on epidemic prevention and control in 2020. To support epidemic prevention and control, China increased the deficit rate from 2.8 percent to over 3.6 percent, cut taxes and fees, and issued special national and local bonds. These rapid fiscal policyresponses are in stark contrast to the slow reaction by the EU and and made positive contributions to resuming economic growth early in the crisis. But we argue it would be counterproductive to strive for a similarly designed fiscal policy under the legal framework provided by the EU Treaties.