From tedium to concern. Europe has never been written about so much. Sometimes good things are said about it but more often than not they are bad. In his wisdom as an observer who has seen so much, Jean Daniel pointed out: “Previously, when we talked about Europe, we were almost sure that we would bore people, just its name was enough to make one switch off. Today, talk about Europe provokes concern: who is it that is producing the most comprehensive account of the incompetence and shortcomings of those representing us in Brussels”. »
Let's avoid the declarations of principle and concentrate more on the facts. To begin with, the following is an observation made by José Manuel Barroso accompanying the decision of the European Commission and the European Central Bank (ECB) in favour of Estonia's entry into the eurozone: “In all this debate, let's remember that no-one intends to leave the euro and others are seeking to join it”. Beyond this reality, we have been able to read everything to the contrary, including the affirmation that the creation of the euro was a colossal mistake and that it is urgent to get rid of it. It is, however, recognised that certain economists know how to explain clearly and convincingly what happened but always a posteriori, after the event itself. If one of their forecasts comes true, it is by way of a calculation of the probabilities. The doctrines are so divergent that certain newspapers have overcome the problem by posing the same question to two experts from different tendencies - “Should the euro be burnt?” One of them answers yes, the euro is going to explode, and the other answers no because the euro is “a miracle of European construction, which cannot happen twice and abandoning it would be a disaster”. Each commentator can prove his affirmation with knowledgeable arguments.
An automatic mechanism? Personally, I was initially attracted by the position taken by Paul Jorion because a few years ago he was generally considered to have provided an early analysis, since 2004, of the American crisis and its causes. His current response is inspired by the great Keynes, “a global system that would automatically correct imbalances” between imports and exports. And this is how it works: “Beyond a certain threshold, a country that exports or imports too much would be subject to a re-evaluation or an automatic monetary devaluation. In such a system, the trade surplus of China or Germany, or the debt of the US or certain other European countries, would not have been able to occur”. It all appears so simple, doesn't it? Nonetheless, we have to ask ourselves whether the author was informed that the European crisis was produced between countries that had the same currency and that Europe, before the euro, had had a long experience of devaluations proving that revising the exchange rates is not everything: for a country that does not have a sufficient quantity of exportable products and which imports almost everything, the results of the devaluation would, above all, increase both the cost of living and the cost of its debt.
A plethora of remedies. We could multiply the examples that give us cause to suspect that sometimes the economists and the experts are more attached to their doctrinal positions than the facts and consequences of their remedies. Some have admitted the possibility of several scenarios being produced and have called for a choice to be made: either re-establish or safeguard competitiveness and allow the value of the euro to slide to almost parity with the dollar; or remove Greece and other Mediterranean member states from the eurozone; or allow Germany to leave, possibly followed by the Netherlands and Austria. This third solution would be the “lesser evil”, given that the best would have been not to create the euro, “a tragic error for Europe”.
The euro also has its defenders. I am not for the moment referring to those for whom it is an instrument that would inevitably lead to a political Europe, but rather to those who support the economic demand to safeguard the eurozone as a whole and reject the hypothesis of Greece's departure from it or the departure of any other country. These commentators point out that the euro has brought: a single and manageable market; Europe has been able to resist oil price hikes and a rise in prices of other raw materials (both of them in the dollar currency); all the member states that have been well managed have been able to benefit from German level interest rates or rates that are lower than those they would have had to accept if they had kept their national currencies. Abandoning the single currency would, according to this thesis, be a disaster for the weakest countries in the eurozone and an endless source of complications for the others (the banks of whom own a large part of the Greek debt).
This brief look at the essentially monetary aspects of the situation should not lead to us forget that the essential aspect of the new phase of the eurozone is economic governance. This section will discuss this matter tomorrow but the following page will provide a look at the positions taken by Jacques Delors, namely the fact that for years he has been calling for the developments that have finally now been agreed upon.
(F.R./transl.fl)