Let's be serious. Incessantly criticising the Community institutions is very much in fashion, even on the part of those who are linked in some way to what are, in principle, pro-European organisations. Some of the commentaries following the informal European Council on 1 March, appeared hollow, as if they were telling readers, “look at me, I am never satisfied, which proves my fine and unstinting pro-European credentials! According to these commentaries, the EU should have, last Sunday: a) backed the Hungarian suggestion of creating a European fund of around €190 billion for member states from Central and Eastern Europe; b) made joining the euro easier; c) defined “European rescue” plans financed out of the Community budget, instead of the national plans the Commission is painstakingly striving to harmonise. How courageous, what vision, what depth of European spirit, n'est-ce pas?
Let's be serious. We knew in advance what was possible at this summit. Reaffirming seven essential principles (see this column yesterday) at the highest level may prove to be a useful exercise. But a fund worth €190 billion to spend on we don't quite know what or for what purpose, is pure rhetoric and was in fact rejected by the majority of member states that would have theoretically benefitted from it. It has been acknowledged that certain countries in the eurozone, such as Greece and Ireland, are perhaps more seriously affected by the financial crisis than Poland, the Czech Republic and Slovakia. Every country will be assisted according to its needs and abilities. Making accession criteria to the eurozone easier would significantly weaken the single currency: it would be madness. On the other hand, the sentence in the final press statement underlining the role of the Commission as guardian of the Treaties had a sweetly ironic flavour coming out of the mouth of Mr Topolánek, who in the past often expressed support for an inter-governmental system and criticised the institutions and supranational procedures. Perhaps he has understood that the “Community method” protects small and medium member states against big member states' superpower?
The stage for affirmations of principle is now largely at an end. It would be hard to see any more than psychological support being given to the projects actively being prepared and which are, in fact, beginning to be put into practice. Radical reform of the financial system, whose abuses and dysfunctions are to a large extent responsible for the world crisis, is making much more progress than the public is led to believe. The news is obviously dominated by staggering financial losses, risks to jobs and bankruptcies but at the same time, revolutions that were previously unimaginable have been agreed at a political level and are technically being prepared. The principle according to which all financial activity will in the future be regulated and subject to monitoring is in itself, revolutionary. The operational projects and measures have also very largely gone beyond the stage of affirmations and good intentions.
It is inevitable that the public at large finds these texts unreadable, despite the efforts made by the specialist press. Overall, we can assert that the initiatives agreed on and which are gradually being transformed into operational texts cover areas that before the crisis were rejected or at least widely contested (even at a theoretical level, the idea of introducing rules in these areas was opposed). Although he has formulated distinctions and expressed reservations, Mr McCreevy himself has taken initiatives to “structure” hedge funds (EUROPE 9849). In addition to this and above all, the Larosière group's report outlined the structure of European regulation and how it would work when monitoring financial activity. Some aspects in this project have been criticised but the welcome has been very positive overall, particularly at the European Commission and European Parliament, which have a key role to play in decisions involving this subject. The authors of the report did not seek to devise an ideal and theoretical system but rather, a project that is both practicable and feasible and which will facilitate control and prevent abuses being committed by financial players at a European level.
At the same time, the Commission has presented its first proposals for discussion at the European Council this month, as well as the EU's position for the April meeting of the G20, the main guidelines for which have now been defined. Added to which is the relaunch of the debate around important but still controversial projects, such as the initiative from former Commission president, Romano Prodi, to promote Euro bonds, backed up by solid arguments (these would be more expensive, however, for Germany due to the financing it receives from its national bond market…)
Europe has therefore entered the operational phase of the response to the crisis. It would be much better if this phase were accompanied by a little confidence and optimism. (F.R./transl.rh)