Brussels, 18/02/2011 (Agence Europe) - Sanctions, macroeconomic imbalances, public debt and more besides. On Friday 18 February, two days after the deadline for amendments to the six items of draft legislation on economic governance, Belgian Green MEP Philippe Lamberts unveiled the line the Greens will be taking in the negotiations at the European Parliament. The Greens want genuine economic governance in Europe, starting in 2013, which should connect up solidarity and responsibility and ensure healthy public finance. The public debt should no longer be allowed to escalate, for example, unless it is used to generate cash for tangible or intangible investment to the benefit of future generations rather than simply covering running costs.
When it comes to penalties on member states that break the stability and growth pact, Lamberts suggested a points system like the penalty points system for driving licences in a number of member states. Countries will lose points for failing to meet the rules and when all their points are gone, penalties would be applied. It would act as a “shock absorber ahead of the fines”, he explained. Lamberts said that the fines should be given to the EIB for investment purposes rather than the bailout fund as suggested by the Council of Ministers (see EUROPE 10316) but should definitely not go to the European Commission or the member states.
The Greens back the idea of monitoring economic imbalances but recommend not using economic indicators alone because the Commission's proposal focuses too much on the labour market. The cost of labour, which is always being brought up, only accounts for a third of the cost of manufacturing goods exported by Germany, for example, pointed out Philippe Lamberts. Other factors need to be taken into account, say the Greens, like the pay gap between rich and poor. The proportion of fossil fuels in total resource use could be used to cover the environmental dimension when calculating wealth.
The European Commission suggests that excess national debt be reduced at a rate of a twentieth a year, but Lamberts says that this is unrealistic for Greece and runs the risk of discrediting the whole setup. He called for voluntarist tax harmonisation measures to be included in the economic governance legislation. (M.B./transl.fl)