Wanted Europeans for All Seasons

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Picture: José Manuel Barroso, President of the EC, giving the first Berliner Europa-Rede organised by the Konrad Adenauer Foundation By Ramesh Jaura
IDN-InDepth NewsReport

BERLIN (IDN) - Is Europe "a great big auction", 'a streetcar named desire' fuelled by an irrepressible force to reach the preferred destination, an embattled marathon runner, or a Sisyphus condemned to an eternity of rolling a boulder uphill then watching it roll back down again?

These questions laden with the gory past of Europe were uppermost in the minds of political actors who had gathered in the 'Berliner Festspiele' theatre to listen to José Manuel Barroso, President of the European Commission, expounding 'The State of Europe' to mark the 22nd anniversary of the historic fall of the Berlin Wall.

Berliner Festspiele, which has been defining the cultural life of the city of Berlin for six decades, has more than once staged American playwright Tennessee Williams' renowned works. In 'Cat on a Hot Tin Roof', Williams wrote: "That Europe's nothin' on earth but a great big auction, that's all it is."

Passionately countering that view, which appears to be regaining currency some 64 years later, German Bundestag (federal parliament) president Norbert Lammert said: Europe is not only not a great big auction but also not inconsequential on earth.

Barroso, a former Portuguese foreign minister and premier of Portugal, agreed. Europe is indeed very different today to how it was in 1938, when the Nazis burned the synagogues, and in 1989 when the Berlin Wall fell, he said, "with the European Union growing from 12 Member States we were then to 27 Member States, having a today a truly continental dimension and a global outreach".

Much of the criticism of Europe disregards that "the case for Europe is a dynamic one. Europe is not a concept that can be finished once and for all. It is a concept that must be, and that can be, adapted to changing circumstances – politically and economically," he pointed out.

The path towards a more prosperous and sustainable Europe is far from over. In fact that path is "not a sprint, it is a marathon," said Barroso. "We have to be prepared for a marathon to test our resilience, our commitment. There will be no miracles."

The EU Commission president challenged the prevailing "negativism trend": Contrary to "the intellectual glamour of pessimism" that underline some media reports and comments, he said, "since the Second World War, and in large part thanks to the development of European integration, we have established in this continent, here in our Europe, the most decent societies known to mankind."

More Europe

The EU may be compared to a streetcar whose destination is "more Europe, not less". Nonetheless, as Barroso pointed out: "The European Union does not promise paradise. But it is indeed our best chance for prosperity. It is institutionally and politically in international relations the single greatest achievement of our time, probably also of human history. . . . Our best means to use the crisis as an opportunity for creativity out of destruction. This is the European Union."

The EU Commission president reminded detractors of "more Europe" that "European Union was created precisely for moments such as we have now," adding: "It is in moments of difficulty that we can see those who are really ready to defend the European Union as a project. What we need are Europeans for all seasons, not only when seasons are easy. It is precisely in moments of difficulty that we have to show our commitment to Europe."

With an eye on growing impatience with Europe's highly indebted and nearly irredeemable economies, he urged Germany – one of the six founding states of EU's predecessor European Economic Community (EEC) along with Belgium, France, Italy, Luxembourg and the Netherlands – to show that it is fighting the cause of a strong, integrated, competitive, united Europe.

"Now is Germany's time to uphold the principles that underpin the European Union and most especially the democratic legitimacy and transparency that come from the Community approach," said the European Commission president.

As Europe continues to chart its way out of the crisis, Barroso appealed to Germany "to show leadership in partnership; to show leadership in the Community spirit". He added: "I know that some of the choices we ask our citizens to make are not easy at all. But if we want the Euro to survive and if we want Europe to thrive, they are necessary."

Taking note of those in Europe who claim that their country does not need the rest of Europe, Barroso argued: "Populism and sometimes even nationalism raises its head across our continent, claiming that too much Europe is the cause of our current difficulties. Claiming that less Europe or even non-Europe would bring solutions."

Economic Rationale

"This is ignoring the global realities as well as our common history that teaches us that this continent is simply too small and too interdependent for us to stand apart," he argued. "To turn our backs to each other. There cannot be peace and prosperity in the North or in the West of Europe if there is no peace and prosperity in the South or in the East."

But the argument for going it alone also defies economic rationality. In 2010, Germany exported more goods and services to the Netherlands (around 15 million inhabitants) than to China, to France than to the U.S., to Poland than to Russia, to Spain than to Brazil, to Hungary than to India.

In the same year, Germany exported almost five times as many goods to the rest of the European Union than it did to the BRICs countries altogether (China, India, Russia, Brazil, all of them). Its imports from the BRICs countries stood at just 20% of those from its EU neighbours.

Were the Euro area or the European Union to break apart, the costs have been estimated at up to 50% of GDP (Gross Domestic Product) in an initial phase, Barroso said. It is estimated that Germany's GDP would contract by 3% and it would lose one million jobs if the Euro area were to shrink to a few core member countries.

"What is more, it would jeopardise the future prosperity of the next generation. That is the threat that hangs over us, and it is that threat that guides our commitment to resolving the situations in Greece and elsewhere, provided that those countries play their part as well," cautioned the EU Commission president.

"That is why all responsible leaders must now make the case for Europe. Make the case for strength through unity. We must engage our citizens in an honest and frank debate about Europe. About its assets, but also about its shortcomings. About its potential and its future. We must show our citizens what is at stake. We must choose the path of strength over weakness. Unity over fragmentation. The hard choice over the easy one," Barroso said.

No Split Union

The EU Commission president strongly warned against "a split union" that he said would not work. "A union with different parts engaged in contradictory objectives; a union with an integrated core but a disengaged periphery; a union dominated by an unhealthy balance of power or indeed any kind of directorium. All these are unsustainable and will not work in the long term."

They will put in question a fundamental, if not a sacred, principle, the principle of justice, the principle of the respect of the quality, the principle of the respect of the rule of law. Because the EU is a Union based on the respect of the rule of law and not on any power or forces.

Making a strong plea for the Euro area, Barroso said: "It would be absurd if the very core of our project – and economic and monetary union as embodied in the Euro area is the core of our project – so I say it would be absurd that this core were treated as a kind of 'opt out' from the European Union as a whole.

"No, the Euro area is not an 'opt out' from the European Union. In fact all the European Union should have the Euro as its currency. So the challenge is how to further deepen Euro area integration without creating divisions with those that are not yet in it."

New Package

The package will include the following five elements:

-- A co-decision regulation linking EFSF (European Financial Stability Facility) and ESM (European Stability Mechanism) assistance with country surveillance, on the basis of article 136 of the Treaty, which envisages a simplified revision procedure on the functioning of the EU without increasing its powers.

By placing the governance of the 17-nation Euro area within the overall Treaty framework and thereby in the Community method, the new regulation is would ensure the legal and institutional coherence and the compatibility between the Euro area and the EU as a whole.

-- A second co-decision regulation on deeper fiscal surveillance, also on the basis of article 136 of the Treaty.

This regulation will set out graduated steps and conditions for monitoring national budgetary policies for Euro area Member States in excessive deficit procedure. It is designed to enable the Commission and the Council to examine national draft budgets ex-ante and to adopt an opinion on them before adoption by the national parliaments, requesting a second reading in serious cases. In addition, the Commission will monitor budget execution and, if necessary, suggest amendments in the course of the year.

-- The package will include a communication on the external representation of the Euro on the basis of article 138 of the Treaty.

The crisis continues to show that the Euro area needs to speak with one voice in international institutions and fora. "We otherwise risk diluting our messages and our credibility," said Barroso. "The more we improve our internal Euro area economic governance the more pressing is also the need for a strong and efficient external representation of the Euro area."

The Euro area Member States taken together are the biggest contributor to the IMF (International Monetary Fund)? However, they appear as different Member States in different constituencies, not as Euro area. "That is why the Commission will make proposals towards a more consolidated European voice and representation in international fora and institutions such as the IMF," explained Barroso.

-- The Commission will also present a Green Paper on Euro stability bonds, though it is controversial.

Barroso said in his State of the Union address to the European Parliament on September 28, 2011 that once the Euro area is fully equipped with the instruments necessary to ensure both integration and discipline, the issuance of joint debt will be seen as a natural and advantageous step for all.

On condition that such Eurobonds will be "Stability Bonds": bonds that are designed in a way that rewards those who play by the rules, and deters those who don't, the Green Paper on Euro stability bonds will present the options for the joint issuance of bonds in the Euro area, together with further steps of reinforced economic governance options that would need to be developed depending precisely on the different options.

Some of them can be implemented within the current Treaty, whereas fully fledged 'Eurobonds' would course require Treaty change.

-- The fifth element of the economic governance package will be the 2012 Annual Growth Survey. Against the backdrop of a waning economic recovery in Europe, the Annual Growth Survey will set out the priorities for policies towards more growth and jobs in the European Union.

The Annual Growth Survey will assess progress in the implementation of national commitments during 2012 in the framework of country-specific recommendations and under the Euro Plus Pact, and help with the preparation of the following year's economic policies.

In addition to these upcoming rather technical – but extremely important – initiatives to have convergence and discipline in the Euro area, Barroso has announced his decision to entrust Commissioner Olli Rehn with a reinforced status as Commission Vice-President for economic and monetary affairs and the Euro.

"Having a Commissioner especially dedicated to the Euro shows our determination to have Euro governance take place inside the community institutions and in respect with the community method," argued Barroso.

"The political and symbolic importance of this measure could not be clearer and is furthermore underpinned by internal Commission arrangements which will reinforce the structural guarantees of fully independent and objective decision-making," he added. [IDN-InDepthNews - November 13, 2011]

Picture: José Manuel Barroso, President of the EC, giving the first Berliner Europa-Rede organised by the Konrad Adenauer Foundation | Credit: EU

2011 IDN-InDepthNews | Analysis That Matters

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