Economics / Events / Politics

Which economic and political future for the Eurozone?

Pierre Moscovici (Minister; FR) and Martin Schulz (EP President; DE)

Pierre Moscovici (Minister; FR) and Martin Schulz (EP President; DE)

Which political and economic integration for the Eurozone? This was the question discussed by some participants in a colloquium organized by the Fondation Jean-Jaurès (a think-think close to the French Socialist Party) and the Foundation for European Progressive Studies (FEPS, a think-tank close to the Party of European Socialists, PES) in Paris on 25 May. 

During one day and two conference-debates, French and European political leaders, analysts and economists dealt with the future of the single currency, in a context dominated by the important distrust of citizens vis-à-vis the European integration and at a moment when Europeans are more and more critical about the European Union itself. According to Massimo d’Alema, former social-democratic president of the Italian Council and current FEPS President, for instance, the Eurozone crisis is also political, due to the choices made by the Member States during the Maastricht Treaty negotiations but also to the incapacity of these Member States to adopt a clear strategy. Jean Pisani-Ferry, a French economist and former President of the think-tank Bruegel, shared and developed this idea, considering there was a disagreement on the way the crisis is perceived in Europe, depending on whether you are in Germany or the Netherlands, or in Italy or Spain. These contradictory perceptions and analysis have a major consequence on the strategy of the EU and its Member States to face the Eurozone crisis, but they also have social consequences within national populations, strengthening the distrust towards the single currency and the European integration.

Nonetheless, ideas for a way out of the crisis exist, with most of the participants insisting on a deeper and more voluntary political integration. For Philip Arestis, who teaches Economics at the University of Cambridge, political integration is even a requirement for the monetary union the Euro to be a success and to be enjoyed by the citizens. For Martin Schulz, socialist Chairman of the European Parliament, the way out of crisis is at the European stage and not the national one, which also supposes a political integration. As the Italian economist Ricardo Bellofiore said, this integration may be a kind of “New Deal” based on growth and employment. On this occasion, Pervenche Berès, French MEP, reminded some initiatives such as the European youth guarantee, currently implemented in some Member States, but still not by the EU because of the absence of EU financing, in spite of the emergency of the situation in matters of youth unemployment.

The 2014 European elections should be the occasion for European socialists and social-democrats to have a real and deep debate about the crisis and the strategy to lead, with the future of the Eurozone and of the European integration in the background. Indeed, a better European integration goes hand in hand with a better functioning of the EU institutions, according to Pierre Moscovici, French Minister for Economy and Finances. It is the prelude to the implementation of a Eurozone economic government. But it also requires a reinforcement of the “Community method”, according to Martin Schulz, and a better institutional balance for the European Parliament, according to Gaétane Ricard-Nihoul, former Secretary General of Notre Europe – Jacques Delors Institute and now member of the Permanent Representation of the European Commission in France.

In other words, the Eurozone’s current situation is now a political issue and a major theme of campaign for the 2014 European elections which the PES wants to politicise, in order to be better heard and to make the difference. A subtle way for the European socialists to expose their point of view and differentiate themselves from the conservatives and liberals, which they judge responsible for the aggravation of the crisis, due to their political choices within the EU and some Member States. The question is whether this strategy will be effective; this requires putting again the citizen at the core.

Gilles Johnson

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