(Probable) reasons for absence. Jacques Delors will not be participating in Tuesday's ceremony and debates organised by the European Parliament to celebrate the tenth anniversary of the Euro (see detailed programme in following pages). Obviously, he had been invited and his presence had been announced in the preliminary programme. He believed, however, that it would be preferable not to attend. His support for the single currency and his conviction that this represented one of the essential results of European construction, perhaps the most important in these tumultuous times, is obviously not in question - he is even more convinced of it. But at the same time, Mr Delors regrets the absence of the indispensable complement to the euro, namely, coordination of economic policies, which he had emphasised so much in the famous report bearing his name, which forms the basis of all European construction. I can imagine that speaking at Strasbourg, he would have affirmed that this aspect should not be neglected but would have deemed that the tenth anniversary would not have been the appropriate moment to express any criticism. Silence would not have been in his nature or convictions, but regrets would have been untimely.
The previous considerations are only personal suppositions. The events occurring in journalistic current affairs, however, led one French daily (La Tribune) to ask him for an interview on the current situation in Europe and in this context he provided a broad commentary on the financial and economic crisis. It is this, therefore, that we now propose to our multinational readership and that Jacques Delors would have been likely to have expressed at the Strasbourg ceremonies. It will be enough in this column to resume the monetary and economic aspects of his interview, with a double warning: refer to the whole text of this interview (published on the site of the newspaper in question) to facilitate reading. Now he can have his word.
(F.R./transl./rh)
MR DELORS TALKS ABOUT EURO: RESULTS, SIGNIFICANCE AND REGRETS
Positive impact. Despite the reservations I expressed in the 1989 report bearing my name, I think that the euro's overall impact has been positive. From 1999-2008, growth was at an average annual rate of 2.1%, investment rates 2.2% and the eurozone created 16 million jobs. The euro helped European integration: a third of external trade from participating member states takes place within this zone (as opposed to a quarter a decade ago), as well as a third of total investment (a fifth ten years ago). Inflation fell noticeably until 2007 and stability is, notwithstanding, a positive contribution to economic activity. Much of the criticism levelled at the euro, is unjustified. Imagine it not existing and our remaining with the cornerstone currency, the deutschemark, imagine what would have happened to several national currencies. I would not be so cruel as to say exactly what. The euro constitutes protection, even against stupidities we create for it.
The British position remains ambiguous. Even if it did not have the importance some quarters accord it, the fact that Gordon Brown collaborated with the Eurogroup is an important sign. It does not suggest that Great Britain will change its mind about Europe but at least there is some useful anchorage while the British economy goes through some testing times. I do not, however, see the British changing their mind. David Cameron's position is known and Gordon Brown is still sticking to the famous phrase made when he was Chancellor of the Exchequer, “Between the world and the nation state, there is nothing…”
Let's be clear, I believe that the federation of nation states does not mean the disappearance of nations or involve competencies being transferred to Europe. If we wanted to go in this direction, we would have to wait for Germany as long as we would Great Britain. The latter is sticking to its positions: to be in Europe, in a Europe comprising a large competitive and economic area and nothing more. Discussions should be held with Great Britain (I do actually have a lot of respect for Gordon Brown's plan on the current crisis) but rapprochement with Great Britain and leaving out Germany would mean we are for the watering down of Europe's political and economic integration process.
Euro lacks counterpart, namely, the economic pillar of EMU. Since the appearance of the crisis, the European Central Bank has fulfilled its role in meeting one of the immediate challenges: the crisis of liquidity, even if we are not yet back to normal in the inter-banking market. The second challenge, the financial market solvency crisis, depends more upon the decisions of different states. We are asking too much of the ECB! Too much, because the counterpart, the economic pillar of Economic and Monetary Union, does not exist. It's easy for governments to criticise the ECB and to think that a cut in interest rates is enough to change the situation. What is in fact needed is a balance between economic policy (not just budgetary policy!) and monetary policy. 60% of the 1989 Delors report focused on the economic angle and 40% on the monetary dimension!
National recovery plans are only at an embryonic stage of what is required. During the preparation of the Maastricht Treaty, I proposed the addition of two other criteria to the five financial criteria for EMU access: youth unemployment and long term unemployment, but I was defeated. More seriously, in 1997, I submitted a paper demanding that in addition to the Monetary Stability Pact, there should be an Economic Policy Coordination Pact. French leaders were happy enough to change its name: instead of the Stability Pact, the Stability and Growth Pact. The famous nominalism à la française! But two or three years later, the same authorities called for an economic government, which I had never called for because I understood that it was a formula that would not be acceptable to the Germans, British or a number of other states. And this is how we missed a unique opportunity!
I am not mentioning this for the sake of recalling my personal little wars but to illustrate that if we are finding it difficult to transform national responses into European responses today, it is because we have not had enough experience and practice in cooperation. Cooperation is neither economic governance nor laissez-faire, it is the middle-way. It is a way for countries seeking harmonisation of their short and medium term economic policies to create surpluses in periods of growth and limit the damage in periods of slowdown
We are now paying the price for this lack of custom. Getting finance ministers to accept other ministers discussing their domestic policy on the basis of a Commission report cannot be done overnight! It is not the screech of the White-tailed Eagle that we sometimes hear that will change things significantly
When we agreed to the Single Act that facilitated Europe's recovery, I came up with a formula: competition that stimulates, cooperation that strengthens, solidarity that unites. I am sticking to this formula. Solidarity - economic and social cohesion programmes (€40 billion today, as opposed to 5 billion when I arrived); cooperation, this is essential and is more than the Lisbon programme but less than political integration. We are not doing it. And the psychological situation has got worse because of the trauma that affected our different populations with globalisation and there is a quest for identity: there are more nationalists around today than ten years ago. We can explain this but we cannot justify it.
The Euro is not in danger, the risks come from elsewhere. Organised Europe is stimulated more by crises than it is disarmed by them. The EU is in rather better shape than it was a year ago. Imagine what would happen to a Head of State who, rather removed from reality, decides to leave the Euro to return to their old currency and how they get support for it on the exchange market! Let's leave that aside. The risk is elsewhere. During this period, the disciplines of the internal market and the Economic and Monetary Union will be made more flexible and, undoubtedly, some governments are quietly hoping that we do not go back to it. What stimulates the European economy, a single market, a relatively organised area and fairly strong competition, would disappear. For the world we are living in, it would be almost fatal. There is therefore a risk to the very fabric of European construction: the internal market, its disciplines and incentives…
The Europe of nation states instead of the Community Europe is possible during a brief period but in the medium and long term, only the Community method can enable Europe to live and progress. How much more time is needed to realise this? We will soon get an indication of this in several areas. This is a fear of mine and I want to express it in no uncertain terms. It is not a question of defending one institution against another. Given that I still have a certain relationship with some governments, I can say that too many of them have a tendency to ignore the Commission. It is easier to say, it's Brussels' fault when things are not going well, and when things are fine, the state in question deserves the credit. This is like a story for getting the children off to sleep.
As for the deepening of European construction, we have to accept an idea that has never won much support: that of differentiation, and resume the formula construed by Mr Genscher, “the countries that want to go further cannot oblige the others to follow, but the latter cannot prevent the others from going forward”. (transl./rh)