Appeal to eurozone countries. The euro belongs to the member states that have chosen it as their currency; but “they don't understand that they have a common good to manage and that gives them special duties”. This is what Jacques Delors said in an interview summarised in yesterday's column. EMU (economic and monetary union) is a separate entity and needs to be seen as precisely that, a different entity from the EU as a whole: “We should be clear that the 16-member state eurozone is not the same as the 27-member state European Union (…) We say to the people who have the euro - it gives you special duties because it is a binding marriage without the right of divorce (…) European leaders do not distinguish clearly enough between the eurozone-16 and the EU-27 and this generates confusion.” If there is a clear distinction, then bold moves are possible: “In the eurozone, we would have been able to set up a special crisis find and eurobonds.” He describes the achievements to date, namely the European Stabilisation Fund and the European semester (when eurozone countries' annual budget strategies are discussed in common before approval of their national budgets) as “two reasons to be cheerful (…) It is not possible to create prosperity in the eurozone without the desire to move towards convergence of the economy and without a degree of social and tax harmonisation.” These reasons to be cheerful should be accompanied by appropriate economic penalties for eurozone countries that do not abide by the required discipline, and such penalties should include the partial suspension of Structural Fund aid. The duties arising from the responsibility of managing the currency have to be respected.
Now is not the time to “transfer sovereignty”. In the eurozone, “the right balance between economic and monetary matters” is of such crucial importance that Jacques Delors cannot see any possibility of radical political changes in the EU in the present circumstances. He pointed this out twice. One cannot count on “new transfers of sovereignty that the vast majority of member states do not want (…) The European project must be continued without any new delegation of sovereignty because nobody wants this.” He regrets this “lack of clear vision of the future of the European project”, but at the moment, the urgent thing is to consolidate the euro. This is an optimistic and voluntarist view, in contrast to those who have already written off the euro in practice and in contrast to those clever-dick economists who go around predicting what has already happened. What Jacques Delors is doing at the moment is setting out the criteria for saving the current eurozone, requiring both respect for the rules and discipline by the weakest member states (he is very strict about this, as we explained yesterday) and at the same time, developing appropriate tools to help them. The two aspects go hand-in-hand.
The fund currently under discussion for the eurozone is exactly what Jacques Delors himself has been recommending right from the start. Here is his updated presentation: “One could imagine the creation of European public bonds, not to fill public deficits but rather to fund future spending; one could set up an Economic Aid Fund that would be active during low-growth years; and what I suggested at the time of the Greek crisis, one could imagine a European interest rate fund that would absorb some of the debt of each of the eurozone countries as a partial pooling that would lessen the debt burden and provide funding for supporting economic activity during the process of cleaning up public and private finances.”
Don't make a mountain out of a molehill. The measures being discussed at the European institutions are largely inspired by Jacques Delors' ideas; and the European Council will discuss them on Thursday and Friday. The Juncker/Tremonti idea, the Monti idea and the Verhofstadt idea match one another in many ways because they have the same source of inspiration. Initial exchanges of views at the Economic and Financial Affairs Council, the Eurogroup and in policy statements are sometimes very pointed, but they should not be exaggerated. We should remember that politicians have one eye to the feasibility of projects and one eye to public onion in their own country or the comments of constitutional courts and such like. The negotiations are tough-going and it is possible that definitive decisions will not actually be taken this time around. We should remember the impressive progress that has been made, however, along with the sheer scale of the issues and the efforts demanded of some member states. Let others take pleasure in dramatising things, exaggerating the problems and prophesying doom, while we keep faith. The desire to build a united Europe will emerge ever the stronger for it.
(F.R./transl.fl)