Earlier this week, I examined the gradual introduction of economic governance in the eurozone. To change the style, if not the subject, today I will focus on some highly significant comments made by other people.
Angela Merkel: 'The euro is in danger and what is at stake is European identity. As far as Germany is concerned, the culture of stability is non-negotiable; it has demonstrated its value. Common EU rules should be based on the rules in the strongest countries, not the rules of the weakest.'
The German Chancellor is right as far as the objective facts go because Germany would not be in the euro if it were not a stable currency. Stability was at the core of German monetary policy back in the days of the Deutschmark and this has not changed with the euro. It is true, of course, that people are entitled to believe whatever doctrine they like. In an article entitled Angela Merkel is wrong, Jacques Sapir, a university professor in Paris and Moscow, took up a whole page in a newspaper to demolish the Chancellor's ideas, arguing that she is 'deeply wrong for a number of reasons' that he proceeds to set out in detail. But the fact remains that Germany would not remain in a currency that if it is not stable and therefore it is true that the euro is in danger. Merkel says that her country is open to the solidarity mechanisms and a 'reasonable balancing' of deficit reduction and economic growth. Compromises are therefore possible, but not on policy issues and doctrine.
Jacques Delors: 'A new EU Treaty? No, governments are fed up of new treaties. All we need is another Pact to supplement the current Stability Pact.' Herman Van Rompuy: 'We're not going to open up the Pandora's Box of amending the treaties. We have other things to be getting on with….'
In my column of issue 10142 of this newsletter, I reported on the disagreements between people who back the idea of a new EU treaty and those who argue that this would be pointless and dangerous. The views of Delors and Van Rompuy clinch the issue and specialist Paolo Ponzano recently explained that the Stability Pact can be amended without changing the Maastricht Treaty as long as the specific measures included in the Maastricht Treaty are not altered (i.e. excessive deficits and the convergence criteria). Taking a more radical view, Jean-Paul Fitoussi argues that 'with a little legal legwork, any action can be legitimised. It's all a matter of interpretation. None of things decided recently are in the treaties, which don't mention a European budgetary authority. It proved necessary to set up a European budgetary authority, even thought the treaties would seem to preclude it.'
Patrick Artus. 'Leave the euro? Any country that decided to leave would immediately collapse. Spain currently borrows money at 3.8% interest over ten years but that would rise to 20% if it returned to the peseta.'
If this assessment is correct, then it explains why the President of the European Commission said that no countries are planning to leave the euro and almost all countries not in the euro are longing to join. It also makes the nonsense of comments that it would be better if Greece and a few other eurozone countries left the euro as soon as possible and returned to their old currencies.
Herman Van Rompuy. In a public appeal on the sixtieth anniversary of the Schuman Declaration, the President of the European Council urged people to look at what they had gained from being in the European Union, and what the EU would provide them with in the future.
I think this public appeal has been made at a good moment and is a moderate and wise response to the persistent trend of denigrating everything European unity and its protagonists stand for. But the editor-in-chief of Brussels' leading French language newspaper has reacted in fury. She did publish Van Rompuy's appeal, and deserves praise for that, but some sections of her editorial are over the top. Commenting on Van Rompuy telling Europeans what is expected of them, she writes 'It is hard to know whether to laugh or cry at this approach. It is another symptom of this impotent European government that pontificates, considers matters, weighs things up, issues communications and views reality through rosy-tinted spectacles. I say to the President of the European Council that his citizens are not interested in what Europe expects of them. Instead, it would be better for them to hold to account that blind, selfish and cowardly bunch who hold power in Europe and are plunging the world into an exceptionally serious crisis.'
Comments like this provide me with an opportunity to point out yet again that European unity changed the lives of Europeans by putting a stop to the long, long line of wars that bedevilled Europe in the past (and which still bedevils people in other parts of the world), by ending famine (which wreaked havoc in Europe only sixty years ago and which still destroys the lives of people elsewhere in the world) and by breaking down the barriers between us. (F.R. trans fl)