It's the people that decide whether to participate in the euro. The decisions made at the most recent European Council in the economic and monetary arena warrant a few additional comments, which go beyond the more general considerations highlighted in this column yesterday. I believe that the difficulties certain member states are encountering with regard to respecting eurozone rules partly derives from a misconception: the consideration that these rules are imposed on the people throughout the countries of the EU. In the beginning, member states' participation in the euro was regarded as compulsory. The real situation, however, proved that this was an illusion. The euro imposes rules that must be accepted not only by the authorities and one or other of the social classes, but also by the people as a whole. This is not a question of party policy. Participating in the euro brings advantages. Socialist governments understand this perfectly well, as witnessed in Greece, Spain and Portugal. These governments have done their best to apply and respect the necessary rules, even when this involves breaking with a part of their own electorate and puts them in danger of seeing their parliamentary majorities reduced or lost, as is the case with Portugal. Nonetheless, the people in each member state are free to make their own choices.
There is nothing dubious about the situation at all: the people of a given member state have the right to reject eurozone rules. If this is the case, the member state must subsequently leave the eurozone and revert back to its national currency.
Social progress in each member state is protected. If the principle of respecting rules is valid and indispensable for all eurozone countries, it is quite clear that with regard to the modalities every social category or trade union organisation has the right to express its objections and lay down its conditions if it considers that the efforts being demanded of the workers or employees weigh on them unequally. It is normal that these organisations defend their interests and members, and the criticism they voice undoubtedly contains a degree of truth (see below the comments made by Mario Monti). However, if we go beyond the observation made above that three Socialist governments have defined the measures which their respective countries must take to fulfil the conditions of euro participation, it is also necessary to underline that at the same time the governments at the centre of the political spectrum have strongly defended the principle of the “social market economy” and have demanded that certain social reforms that exist in their own countries be protected.
This is the case with Belgium and Luxembourg with regard to the issue of index-linked salaries, which the Belgian prime minister, Yves Leterme, described as a “key element in our social model”. The Luxembourg prime minister, Jean-Claude Junker, has maintained index-linked salaries, despite the concerns of other eurozone countries. It is true that Belgium has maintained a number of precautionary measures, such as the law stipulating that Belgian labour costs cannot exceed those of its three main trading partners (Germany, France and the Netherlands) but the essential social benefits remain. The euro not only guarantees monetary consolidation and economic stability but also protects social progress.
It should not be forgotten that certain positions remain within the remit of the member states themselves, even though exchanges of views on these positions are held in common. The president of the European Commission, Mr Barroso, explained that in the context of single currency management, “if we talk about competitiveness, it will be difficult for heads of state and government not to talk about wages. Nevertheless, Brussels will not decide what is to be done in the member states. We have never had the idea of encroaching on this remit.” This remit will remain the preserve of the member states.
For growth and jobs. In a written commentary, Mario Monti, explained that it was necessary to strengthen common rules so that the imbalances in one country would not be transmitted to the whole eurozone. Nonetheless, he also affirmed that the issue of growth had become incisive although previously this term was nothing but an element of fictitious rhetoric. It is now accepted that insufficient growth not only creates economic and social problems it is also “one of the main causes of financial imbalances”. After having pointed out that the commitments made will not be exclusively inter-governmental (the Commission, European Parliament and the European Court of Justice will also have their respective competences), Mr Monti underlined that clearly planned coordination of fiscal policies “will help reduce the tax burden in the workplace, in comparison to other factors of production, such as capital, which enjoys excessive benefits from unbridled tax competition”. He concluded that “new prospects are appearing for growth, employment, social fairness and citizens accepting European integration”.
The trade union movement is right to demand that these aspects are not forgotten. (F.R./transl.fl)