Brussels, 18/04/2012 (Agence Europe) - At the latest in a countless number of plenary debates on the sovereign debt crisis on Wednesday 18 April, the main political groups of the European Parliament called for a European strategy in favour of growth based on investment, in order to balance out the negative effects of budgetary consolidation, which is not itself called into question. The Liberals are calling for a partial pooling of the public debt of the eurozone countries.
“We need to create the conditions for sustainable growth”, said the leader of the EPP Group, French MEP Joseph Daul. e argued the need to “carry out a qualitative audit of European public expenditure”. On this basis, the forthcoming multi-annual financial framework must become a “key instrument of recovery”, a “reserve” in favour of investment. Daul said that the initiatives which will be taken and paid for at European level must show the benefits they bring in terms of growth, rather like the subsidiarity test developed to determine the optimum administrative level at which to carry out a specific action. “We want a proper growth strategy”, said Hannes Swoboda (S&D, Austria). This is what François Hollande, the Socialist candidate for the French presidential elections, and the director-general of the IMF, Christine Lagarde, ask of the Europeans. Reacting to the Employment package revealed on the same day (see other article), he spoke out against the attitude of the Commission in this area, accusing it of wanting “less and less security and more and more flexibility”. He warned that Europe would face an “economic and social Titanic” if it does not tackle the challenge of youth unemployment.
On behalf of the Liberals, Belgium's Guy Verhofstadt said that the crisis was far from over, with the increasing tension on the Spanish and Italian debt market to be taken as a wake-up call. He argued in favour of a dual approach: - the launch of a “global plan” for growth, mobilising the EIB, the unused money from the Community budget, project bonds once these are in existence; - “the partial pooling of the debt” of the eurozone countries by means of a redemption fund of “€2.3 trillion”. Conceived by German economists, the creation of a fund of this kind would make it possible to pool excessive debt (above 60% of GDP) of all countries of the eurozone over 20 or 25 years (see EUROPE 10528). With this fund, it would be the holders of sovereign debt instruments and “not the taxpayers” who would put their hands in their pockets, whereas at the moment, it's the taxpayers, Verhofstadt stressed.
The leader of the Greens/EFA Group, Germany's Rebecca Harms, said that the “fanatical austerity policy” no longer passes muster in the member states. She argued that the increase of the anti-crisis firewall to €700 billion decided upon by the Eurogroup is still not enough and that the European Stability Mechanism, which is due to enter into force in July of this year, should obtain a “banking licence” in order to have access to ECB cash. The monetary policy of the European Central Bank, which made it possible to save the euro with its massive injections of cash, should also be the subject of “one-to-one” discussions, she added. On behalf of the GUE/NGL, the German MEP Gabriele Zimmer spoke out against those who have sensationalised the stability of the single currency without paying any heed to people's lives. The austerity policies imposed upon the population serve no purpose; they even increase the level of the debt, she argued. She went on to accuse representatives of the European Commission: “The European social model isn't dead? Go and have a look in the countries under the programme (…). Where are your poverty reduction targets from EUROPE 2020, which were defined before the crisis? We no longer talk about it (…). Present a real programme.”
The eurosceptics did not squander the opportunity to criticise Europe's inability to get out of the crisis. Here is our recipe, said Martin Callanan (ECR, UK): either Germany and the countries of the North agree to make massive financial transfers from the North to the South, or Greece is allowed to leave the eurozone so it can default and devalue its currency. Interest rates on debt and mass unemployment in Spain, the inability of Prime Minister Mario Monti to resolve Italy's problems: “the euro is doomed to failure” and the only question is how long it will take, joked his fellow Briton from the EFD Group, Nigel Farage. As for Bruno Gollnisch (NI, France), he expressed the view that the crisis was the result of unbridled free trade, which is responsible for the “dis-industrialisation” of Europe and of the “rampant socialism” characterised by an “inflation of public expenditure”, of which even “self-styled Liberal regimes” have been guilty.
The president of the European Commission, José Manuel Durão Barroso, reiterated the need for Europe to “combine” budgetary consolidation with structural reforms. He argued in favour of a European policy of “investments” by means of the future multi-annual financial framework, whilst rejecting budgetary stimuli, which he believes brings about false growth. On the partial pooling of eurozone debt, the commissioner for the euro, Olli Rehn, spoke of a “proposal” further to the analysis of the responses to the Commission's consultation. This pooling of debt will be acceptable to certain countries only if it is accompanied by budgetary prudence and sustainability, he warned. (MB/transl.fl)