N. 66 January 2016 | Europe’s failures and the need for a change of pace

The latest European Summit confirmed that the European unification process is facing a concrete risk of failure. Therefore, a change of course is imperative if we are to find a solution to the priority matters on which the future of europeans depends: the governance of the eurozone, internal security, reforming the treaties.

The process of European unification is in very real danger of definitively running aground. As the last European summit of 2015 confirmed, Europe is currently showing a disturbing level of division, indecisiveness and impotence. Rather than encouraging a greater unity of purpose and greater social cohesion, the various crises that have struck in recent years (the economic crisis, followed by the financial and sovereign debt crisis, and most recently the refugee emergency), not to mention the problem of Europe’s relations with Russia and the terrorist attacks linked to the war in Syria and the chaos in the Middle East, have actually made Europe less united and less compact. It is only thanks to the lifeline of the European currency, together with its corollary, i.e. the policies that the European institutions (primarily the ECB, European Commission and, albeit often grudgingly, the national governments) have had to pursue in order to avert a crisis that would be not only monetary but also economic and social, that Europe has managed to avoid being reduced to a mere geographical concept.

But the fact remains that, in the Europe of the single currency and the Lisbon Treaty, the economies and policies of the member states have, on numerous occasions, been seen to diverge far more than they ever did prior to the fall of the Berlin Wall. Furthermore, as remarked by Norbert Röttgen, Chairman of the Bundestag’s Committee on Foreign Affairs, the single currency has turned out to beirreversible, but not indestructible (FAZ, 15 August 2015); from this perspective, the excessively long time frame envisaged for the creation of the proposed four unions (banking, fiscal, economic and political) is incompatible with the survival of the euro. The refugee crisis and the terrorist attacks have also highlighted the fragility of the Schengen agreement, which was intended to establish internal security as well as allow the free movement of goods and people within the single market.

It is therefore necessary to step up efforts to tackle Europe’s current situation and resolve, in the coming year, the three priority issues that will determine the future of the next generations of Europeans, namely eurozone governance, European internal security, and reform of the EU Treaties.

Efforts to address the need for proper governance of the eurozone, first exposed by the financial and economic crises of 2008, date back to 2012, when the European Commission, in its Blueprint for a deep and genuine Economic and Monetary Union (EMU), and the four presidents (of, respectively, the ECB,Eurogroup, European Council and European Commission), in a special report, laid down a roadmap for the creation of the four unions. However, the fact that the governments and parliaments in the member states, and the European Parliament itself, have so far been reluctant to implement this roadmap is seriously damaging the credibility of the Europeans’ will to build, at continental level, a centre of political and not just monetary accountability. This was borne out by most recent European Council, held in December 2015. The fact that, once again, tension between the governments dominated the meeting merely confirmed that evolution of any kind continues to be precluded by a crisis of trust between the member states, and also that the crucial hurdle, which absolutely must be overcome, is to bring about some measure of shared political sovereignty at European level through the transfer, by the member states, of certain prerogatives of government. The fact is that, within the context of the banking, fiscal, economic and political unions, everything is inter-related and the individual issues cannot be resolved separately. Even within the banking union project, where some goals had already been reached and there had seemed to be agreement on the process for completing the union, differences between the various national systems are now creating tensions that cannot be resolved without addressing the broader issue of the transformation of the monetary union into a federal political union. What is needed is a European system to replace the current intergovernmental method – a system in which the European Commission, made accountable to the majority of the European Parliament and the Council, in other words, to the citizens and the member states, will be granted the powers and instruments of government, which include control of an autonomous budget, allowing the implementation of European economic policies, and powers over governments that fail to respect common standards. In a historical period that is witnessing momentous changes in the dynamics of production and employment and in which, therefore, continent-wide plans and a climate of stability and security are increasingly needed, Europe, unless it makes this quality leap forward, will continue to be in trouble, struggling in particular to bring about the desperately needed revival of production and economic growth. Furthermore, as we are seeing, its current paralysis is leading to an exponential increase in anti-European, nationalist, populist and xenophobic forces.

The internal security issue, whose full complexity and seriousness have recently been highlighted by the difficulties managing the new migratory flows and, in dramatic fashion, by the Paris massacres, clearly demands, first of all, the definition of a genuine European policy in these areas, starting with the establishment of truly European coast and border guard, which would be independent of the states, in line with the proposal of the European Commission. In this case, too, the link, at both political and economic level, with the issue of governance of the euro is clear. The close relationship between the European currency, the single market and European security was indeed established and formalised by the Lisbon Treaty, with the result that issues previously governed by the third pillar, such as judicial cooperation in criminal matters and police cooperation, are now subject to the same type of rules as matters pertaining to the single market. On the political level, the key challenge is, in this case too, to bring about a relinquishing of sovereignty by the states and the building of a legitimate European power; in other words, to make this transfer of competences from the member states to Europe part of the construction of a genuine political union.

Finally, as indicated above, there is the question of Treaty reform, already necessary on account of the institutional limits of the Treaty of Lisbon, but now rendered even more pressing by the decision of the Cameron government in Britain to hold a referendum on whether the UK should stay in the European Union. This decision has effectively set a deadline (2016-2017) for formulating the Treaty changes that are necessary not just to define the terms of an eventual Brexit or Brexin, but in particular to establish a new institutional framework compatible with the coexistence of two circles of EU countries: one comprising those that belong to the single currency, or intend to join it, and that, to avoid collapsing, have no choice but to pursue the creation of the fiscal, economic and political unions; and the other comprising those, the UK in particular, that are not prepared to go beyond the sharing of single market rules.

The various issues on the table – eurozone governance, European internal security and EU Treaty reform – are thus three aspects of the same problem, and accordingly must be addressed through a single and coherent project for political and federal union.

Recognising this fact is the first crucial act of courage that is needed on the part of the national governments, the national and European institutions, and the various political forces. It is also the only means of paving the way for this recognition to be translated into political will and determination and, by extension, into the institutional leap forward that the President of the ECB has repeatedly called for and that the Europeans must accomplish within the current legislature, given that beyond this time frame it may well be too late.

It is really up to all those who truly care about the future of their own country and of Europe to make sure that all this happens.


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