January 2013

 

 

 

 

The creation of “four unions” (banking, fiscal, economic and political), thereby solving the problem of democratic legitimacy, is the objective towards which the governments of the eurozone countries, the European Commission, the ECB and, in the end, even the European Parliament have, albeit very tentatively, undertaken to move in order to secure the euro, solve the sovereign debt crisis, and create a true economic and monetary union. The governments, pressured by the crisis, have had to acknowledge that it has become impossible to go on managing the monetary union through institutions and treaties that were designed simply to allow the coexistence of and cooperation between a number of states within the broader common market, and not for the purpose of governing the currency, economy, budget and fiscal system of a supranational state. This, if we look beyond the cautious language used and the objective difficulty of unravelling the tangled web of Europe’s existing institutions, is what emerges from the European Commission’s “blueprint for a deep and genuine EMU”, from the report recently prepared by Van Rompuy together with the other three European presidents, and from some passages of the resolutions adopted by the European Parliament before the last European summit of 2012.

The fact that this summit failed to adopt important resolutions – although decisions were taken concerning the creation of the banking union, decisions on the other unions were postponed until June 2013 – should not be misconstrued. The summit actually marked the start of a difficult confrontation at intergovernmental level on the questions of why, how and by when to create the “four unions”. Moreover, it showed up the main obstacles to their full realisation – obstacles that need to be overcome but that no one dares to expose and address, bringing them to the forefront of political action.

The first obstacle, highlighted by most reports and comments on the summit, concerns the differences that exist between the eurozone countries (France and Germany in particular) over the institutional nature of the future political union, now universally accepted as essential for framing and governing the other unions. Germany would like it to be federal, but still does not know how or with whom to establish it, while France would prefer to stick with a confederal solution, i.e. avoiding any effective transfer of national sovereignty, a position that patently goes against the reality and needs of our times. Neither country, however, seems to fully appreciate the need to achieve federation of the eurozone within the broader confederal framework of the single market.

The second obstacle highlighted by the latest summit is the scant regard paid to the time factor. Indeed, even supposing that France and Germany do manage to agree on the nature of the political objective to be pursued, and steer the construction of the four unions towards it, the timetable envisaged for bringing them to fruition, which assumes that the world and history itself is prepared to wait for the Europeans, is quite simply unrealistic. One need only consider that at the latest European Council, held on 13-14 December, the heads of state and of government were willing to implement only the first, and in theory the least demanding, of the phases envisaged by the Commission’s blueprint, namely the one that should, in the short-term (i.e. the next 6-18 months), lay the foundations of the Single Supervisory Mechanism for the banking sector under the auspices of the ECB, bring about coordination of economic policies, and promote the reforms needed to overcome the imbalances between states and improve competitiveness. However, they postponed until 2013 decisions on the fiscal union (“proper fiscal capacity for EMU”), whose realisation the Commission envisages only in the medium term (between 2014 and 2018), and on the completion of economic and political union (not expected before the end of 2018), to be accompanied by the creation of an autonomous eurozone budget with significant capacity to help member states absorb economic shocks. Those in government should be familiar with the words of Machiavelli, who warned that that embankments should be built and reinforced in “quiet times”, and not in the midst of raging currents and flooding (The Prince, XXV). There is therefore absolutely no justification for slowing down the process of unification on the strength of a temporary return of calm on the markets. And it is politically irresponsible to think of delaying until after 2014, 2015 or even 2018 – what is more without even starting to do the necessary groundwork – that which common sense demands should be done at once.

The third obstacle is the absence of a strong opinion movement equipped with a real awareness of the choices that need to be made in order to guarantee Europe a future, and also with the ability to gather sufficient consensus to support their implementation. The governments of the eurozone countries, the European Commission and the ECB have, in fact, all shown that that they are no longer able, in the absence of pressure from political forces and public opinion, to go beyond what they have already done. It is up to political parties to address this problem; to help highlight clearly, in political debate and electoral campaigns, the close link that exists between the creation of a true federal union, the relaunch of development, and the possibility of restoring democratic control over European decisions taken at supranational level. Because this is the starting point from which it becomes possible to think of generating, in time, the popular support necessary in order to complete the profound political and institutional transformation taking place in Europe, combat euroscepticism, and oppose populist, nationalist and micronationalist/separatist tendencies.

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The Europeans are on the brink of a difficult political battle, in which many things are at stake: the achievements of over sixty years of integration, the welfare of current and future generations, order and justice in society, and the democratic exercise of popular sovereignty at supranational level. The era of procrastinations, half-measures and expedients, designed simply to preserve the status quo at national and European level, has ended.

Those who truly want to save the monetary union from disintegration and prevent the disappearance, in our societies and across Europe, of solidarity, development prospects and democratic control over decision-making should therefore strive to ensure that the governments, parliaments, political parties and trade unions overcome the obstacles that are currently preventing Europe from advancing towards political union, and stand up for federation of the eurozone. This means supporting the creation of an autonomous budget for the eurozone, demanding the involvement of representatives of the citizens in a European constituent debate through the convening of a constitutional assembly with a mandate to draw up a federal constitution, and remembering that resolving the problem of European democratic legitimacy necessarily means redefining the responsibilities and functions of control on budget, fiscal and economic questions relating to the eurozone that are exercised within the European Parliament, differentiating those exercised by MEPs elected within the euro area from those exercised by MEPs from countries outside it.

In this way, the construction of the “four unions”, and thus of the federal union, could be made the dominant theme of the next electoral campaigns and of political debate on the future of Europe.

Publius

 

 


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