Brussels, 28/03/2011 (Agence Europe) - Unsurprisingly, the general response to the European Council last week when it comes to the eurozone sovereign debt crisis is mixed, with the right wing welcoming the results and the left hostile to the austerity policies (see EUROPE 10345).
On behalf of the EPP at the European Parliament, Joseph Daul of France and Corien Wortmann-Kool of the Netherlands said that the EPP had been fighting for tax, budget and social convergence since the start of the financial crisis and were delighted that they had been achieved. They say the summit was good news for jobs and growth in Europe because of the passing of the Pact for the Euro. The pact for the eurozone primarily will harmonise various national policies (employment, pay and pensions) to boost member states' competitiveness. Six non-euro countries (Bulgaria, Denmark, Latvia, Lithuania, Poland and Romania) have joined the pact.
The Liberals are sceptical about the Euro Plus Pact. The chair of the Liberal group at the EP, Belgium's Guy Verhofstadt, said he had serous doubts about the pact for the euro's ability to achieve financial stability: “I have serious doubts that the 'Euro Plus Pact' can achieve this goal as past experience has shown that national governments are unable to discipline themselves.” He believes the European Commission should have the lead role in economic governance. Sweden's Carl Haglund comments: “The Euro Plus Pact adds yet another layer to the increasingly complex set of instruments addressing the issue of economic governance.” France's Sylvie Goulard is pleased the economic governance covers banking and the single market. All Liberals want the Community method to be the engine of the initiatives that have been undertaken.
The European Social Democrats see things differently. Furious at the perpetual errors of management carried out by the Conservatives, the chair of the Party of European Socialists, Poul Nyrup Rasmussen, comments: “The conclusions of the European Council today do not make a single reference to investment … How can Europeans, who first and foremost want to hear about new jobs being created, take these conclusions seriously?” He described the measures as a “Charter for Austerity” and says the creating of a European Stability Mechanism (ESM) in July 2013 for the eurozone is a start but also a missed opportunity because “the mechanism will not have the ability to issue bonds on the secondary markets.” Rasmussen wants taxes to be introduced on financial transactions in the EU.
French Green MEP Pascal Canfin criticises the Pact for the Euro for being 90% neoliberal measures with a sprinkling of progressive measures. He says the pact rightly covers pay rises and productivity but forgets that in Germany, pay rises slower than productivity, which is what has helped the country gain market share from its European partners. He says that household debt is a key issue because it has increased the public debt of Spain and Ireland. However, it will only be monitored whereas holding back public debt will be writ in stone in national legal systems, he explains with regret. Favouring the recent draft legislation on harmonising how company tax is calculated (see EUROPE 10338), Canfin regrets that the new EU measures will not be compulsory. (M.B./transl.fl)