Brussels, 16/10/2012 (Agence Europe) - The financial crisis is the biggest test for the European project since it was set up, said Jo Leinen MEP (S&D, Germany) at a conference on Tuesday 16 October organised by the Notre Europe think-tank, adding that millions of Europeans believe the crisis is not being handled properly. He said the austerity policy had shown its limits and was hurting a lot of people, and a Europe in which nearly half of young people in some countries were out of work was not the type of Europe that people want. He said the recent award of the Nobel Peace Prize to the EU provided a good opportunity for getting back to basics.
This was also the view of Étienne Davignon, former vice-president of the European Commission, who said the prize had been both a surprise and a shock. The European Union has managed to establish a lasting peace, but nevertheless there are almost as many inequalities in society these days as at the start of the European venture, and these inequalities are feeding into the lack of confidence felt by the markets, politicians and ordinary people.
André Sapir, professor of economics and co-author of the Tommaso Padoa-Schioppa Report (see EUROPE 10653), says the situation is due to a mistake that nobody foresaw ahead of the launch of the single currency. When monetary stability union was set up, he said, it had only focussed on one aspect of stability, namely prices, ignoring financial stability. Disparities then arose among the various economies.
Leinen says it is very difficult to harmonise imbalances and even the Structural Funds (designed to alleviate such disparities) have not borne fruit; but this might be because of the way they are used and the fact that EU money is sometimes “wasted.”
Davignon concluded by saying that the Nobel Peace Prize would weigh upon the upcoming European Summit so that after the summit, the leaders would not simply say that the crisis facing the European Union was somebody else's fault. He praised the courage of Angela Merkel in Athens and said the crisis was a major risk for Europe, but also a huge opportunity. (EL/transl.fl)