Improved balance. The balance is improving between the two big objectives that currently dominate Community life - the correction of member states' excessive budgetary deficits and the recovery of economic activity. Let me recall the sign noted at the end of last week, when the European Commission gave its opinion on the request from France to extend the time period for bringing its budgetary deficit below 3% of the gross national product. Paris had asked for a year's respite (2014 instead of 2013), European Commissioner Olli Rehn granted two years, and therefore the obligation slips to 2015. In return, France must try to speed up reforms so that the 3% objective might be pursued through the reduction of spending, more than by increasing taxes. That's the balance.
In other words, the member states should not choose between deficit reduction and economic recovery - the two objectives are to be pursued in parallel. Some people have dared to state that this is the end of stupid Europe, as if in reality the double requirement was not bascially evident and recognised. It is just as crucial to redress the national budgets that are too greatly in deficit as it is to boost the economy. The issue is the balance between the two requirements and it's progressing.
The reluctant. Of course, this balance is not accepted by everyone. Extremists reject the efforts on what was once called austerity - a word that today has been done away with (and rightly so, given the significance its has for the general public). But the extremists do not explain how to confront the debts that could continue to snowball. Contrary to what is often said, this is not a position that is reserved for a party on the left. Let me recall, by way of example, that Mr Berlusconi - when he was prime minister in Italy - rejected the idea of programming debt repayments according to eurozone rules. Instead, he envisaged exit from the single currency - but without saying how Italy would have obtained the financing crucial for its survivial.
Henri Malosse, the new head of the European Economic and Social Committee, who belonged to the employers' group, understands extreme positions - even if he does not share them. In the interview published in EUROPE 10840, he considered that the effort demanded of eurozone countries that are in difficulty is excessive. “To save the eurozone, we have sacrificed 30% of the Greek population and 30% of the Portuguese population”. And he added: “I campaigned for the euro but the price is not worth it”. Must the countries in difficulty therefore leave the eurozone? Here is what Mr Malosse says: “I think most sincerely that the question can be asked if the price for staying in the currency zone is so high. If I was responsible in these countries, I would understand that the question is asked.” And he also has grave doubts about negotiating a free-trade agreement with the United States at the current time.
These positions ignore the fact that the countries involved don't want to leave the euro and have their reasons for this.
Who pays for the bailouts and the deficits? The cost of the bailouts should not be ignored. The figures speak for themselves - in the case of Greece, this cost is already astronomical. Who has to meet it? For the most part, the other member states - and thus their citizens - not just Germany and other countries that are in relatively favourable conditions, and also those who must confront very difficult national situations. The adversaries of recovering excessive budgetary deficits too often ignore this aspect.
The truth is that the real cost of a country's budgetary disorder and debts weighs especially on the weakest categories of its population - and not on the richest or the political class. This means that the reocovery of a budget that is too greatly imbalanced is particularly necessary for improving the situation of the less well off categories - contrary to the superficial analyses. Recovering a state's balance and fighting the wastage, abuse and useless spending is primarily positive for the less well off classes and contributes to fighting the abuse. What is valuable for citizens is of course also valuable for states. The most prosperous countries are sometimes the beneficiaries of funding for member states in difficulty - if account is taken of the interest rates game. Let's not forget, though, that the aid that greatly exceeds the capacity of the beneficiary country will never be reimbursed, or it will ruin the country and its citizens.
The reality is therefore more complex than what demagoguery makes out. Let's not forget the progress of Community legislations. The effects of this progress will be gradual.
(FR/transl.fl)