current affairs
peoples and politics

A new understanding of europe
MARIO MAURO, member of the European Parliament, speaks of the changes introduced in the most recent EU treaty, London’s “great refusal,” the French-German axis, and the attempts to break from a grave impasse that is putting the solidity of the Eurozone to the test (not only as an institution). He offers an explanation of what is happening, and why “more Europe” is needed.

by Luca Fiore

The European Union is in the middle of a ford. It has neither the courage to go back where it came from, declaring “each man for himself,” nor the strength to reach true political union. The danger is that it will remain in the middle of the river and be swept away by the current of the economic crisis that seems to be threatening above all the stability of the countries of the Old Continent. Mario Mauro, a member of the European Parliament, former Vice-President of the Parliament of Strasbourg, and today group leader for Italy of the European Popular Party, is convinced of this. There is a great deal of confusion, but one thing is clear: during the December 9th European Council gathering, the leaders of the 27 countries of the European Union approved a pact to save the euro, committing 26 member countries (the United Kingdom declined) to comply with a treaty that will subject the taxation and public spending responsibilities of each country to reciprocal monitoring. This agreement means a new surrender of national sovereignty to what many call the “United States of Europe.”

Representative Mauro, this agreement changes the face of the EU as we have come to know it. What led to such a drastic decision?
The economic and financial crisis underway is testing the solidity of the EU as an institution. In fact, it has been seen that the European project is incomplete. On the one hand, it has generated a series of great opportunities; the united European market crowned by the birth of the euro has provided a high rate of prosperity for European countries. On the other hand, however, it appears evident that without a common economic and fiscal policy, our currency has no hope of surviving the current crisis.

London’s great refusal caused a sensation. As usual in a European setting, the mere fact of agreeing is already something to consider a success.
Three different positions clashed. The United Kingdom declared its unwillingness to enter into an agreement of true fiscal union, because, as David Cameron clearly explained, it sought to protect its national interests, and thus to defend the financial market of the City of London. More regulations on finance would mean fewer profits, thus making the City less attractive. The second position, that of France and Germany, the so-called “Franco-German directorate,” strongly desired fiscal union, but only among the nations that are already part of the Eurozone. The third position, which is the one that prevailed, was that of the Parliament and of the European Commission, which pushed for a fiscal union born of a project not of the 17 Eurozone countries, but of the 27 of the Union.

Why did that position prevail?
There was the realization that to emerge from the ford, the European Union as it exists today is not enough. But the problem is not that Europe as a political project is wrong, as stressed by the Euroskeptics who want union only in terms of entente cordiale [amicable understanding] for “good neighbor” policies. To the contrary. Determination is needed to reach a condition in which the economy of the European countries follows a common project and is capable of giving timely responses to the challenges of the economic crisis and the markets.

However, it seems that up to now there is more emphasis on economic austerity than on reviving the economy. And austerity often means more taxes and less consumption, and so farewell to reviving the economy....
For Germany, too, it has become clear that the problem is not just that of stability, with measures based on reducing and containing debt, but also that of development and growth. However, the European institutions hold that once there is the possibility of a strongly shared economic policy, to the point of having imposed precise rules on the balances of each country, then it will be easier to help growth. This position is based on the fact that each country, or in any case many European countries, no longer have the dimensions for an autonomous policy of growth. Having strongly pushed the single market, this policy of growth must be formulated and enacted together.

Let’s take a step back: the economic crisis has been underway for several years, but only in recent months has the situation come to a head, forcing the EU to change the rules of play. Why?
Yes, some European countries had already entered into crisis–for example, Ireland, Greece, and Portugal. The problem arose when the markets focused on one of the most important European economies: that of Italy. I was present at the meeting between then–Prime Minister Berlusconi and the President of the European Commission Barroso following the EU’s requests for rigor from our country. On the one hand, Berlusconi rightly emphasized the solidity of the Italian economy above all because of the excellent level of private savings of our families; on the other, Barroso pointed out that the problem in that moment–which brought the EU to consider Italy as not just endangered, but as “the” danger and thus a factor of contagion for the European economy–was the disastrous performance of our country’s government bonds on the market of the Credit Default Swaps (CDS).

What are they?
When one buys a country’s bonds, for example Italy’s B.O.T.s, and one fears that the country is shaky from the point of view of management of the public debt, then one can buy other bonds called Credit Default Swaps, so that if things in that country go badly, one is reimbursed. In substance, they are insurance bonds. However, market speculation has made it possible for buyers to purchase the CDSs even without possessing the government bonds.

And so?
I’ll explain. If, out of a group of ten friends, nine buy insurance bonds on the government bonds, and only one buys the government bonds, it is clear that the risk that country runs appears enormous to this group. Evidently, in this situation, Italy, which has an immense debt, much bigger than that of Greece, was seen as the main danger. Thus, in the meantime the European institutions worked to stop a series of procedures that determine the collapse of the markets. One of these institutions, the European Central Bank, even went so far as to buy government bonds on the secondary market to control the pressures against our government bond market. So it was necessary to assure that in the future the countries would not be in such a situation that their own balances endangered the solidity of the whole system; on the other hand, rules were necessary for the financial markets.

The crisis may well be economic, but it is undeniable that the European Union has difficulties on the political level as well. This is not a recent development.
From the political point of view, there is a crisis of leadership that has led to a stall of the European project lasting 30 years. From Kohl onwards, the Europist drive in the footsteps of the founders has substantially bogged down. On the tables, there is a dramatic misunderstanding underway, the thought that each country has defended its own national interests, rejecting the communitarian logic. First 12, then 15, then 27 have been elbowing to have their own slice but, with this logic, there are always winners and losers. Instead, the logic for participating at these tables can only be that of the common good, in the sense of affirming the principle that translates into greater European competitiveness compared to other global subjects.

It seems easy, expressed this way...
We are in the presence of a structural crisis worsened by factors particular to Europe. The first of these is demographic: Europe has 502 million inhabitants, 75 million of whom are under the age of 25, while Egypt has 80 million inhabitants, 60 million of whom are young people under 25. The responses to the problems in structural terms are very complex. Precisely for this reason, not just coordination but true unity is needed, unity of judgment that also means an anthropological judgment on the problems. Thus, Benedict XVI’s approach to Europe’s problems is anything but detached from reality: from the beginning, he commented on the crisis in anthropological terms. All these things are connected; even the way the Credit Default Swaps are managed is related to what conception of man one has.

Another criticism of the EU is the deficit of democracy.
This is an objective problem and, in effect, it is the admonition that comes from the position of the United Kingdom. While London can be criticized for her stance at the Council of Europe, her admonition about the deficit of democracy of the European project is true. There are two ways to find a solution to this deficit of democracy. The first is to continue building mutual understanding among the European peoples. It is not an empty formula: it is tied, for example, to the freedom of circulation and the work mobility of the countries of the Union; by now there are tens of millions of Europeans who work in countries other than their own. If we looked at the statistics on marriages among people of different countries, we would discover very interesting things. The second aspect is more strictly political, and concerns the action that the national parliaments and governments must take to participate in the decision making that happens on the European level. The Treaty of Lisbon pegged this down very clearly, and it would be useful to see the institutions of the individual countries take some steps forward.

For example?
In order to participate in the European decision-making process, the Italian Parliament has eight weeks to give its own opinion on each measure. It is called the “procedure of subsidiarity.” If, in eight weeks of time, the Italian Parliament finds it difficult to convene, problems arise.

Another problem is that the common people seem to lack a sense of belonging to this Europe...
Education can contribute to this, and this education can be transmitted through several realities of society that believe in Europe. I belong to a generation that, notwithstanding the great confusion of that time, saw and looked at Europe with hope, and thought that it would have brought the best. The first place I heard Europe spoken about was the Church. The Church was absolutely certain that the Christian roots were a valid reason for legitimating the positivity of the European project. Today, probably, seeing the dominant relativism the Pope always speaks of and the nihilism that pervades European culture, this sense has weakened. The problem is that if we look at how things are truly going, one realizes that Europe remains the only prospect possible.

In what sense?
None of our countries alone is able to face the enormous problems we experience in global competition. The truth is that to emerge from the ford we need more Europe, not less Europe. However, this “more Europe” must be lived with a greater sense of responsibility. It is necessary to examine the problems seriously, not as the mass media or the Italian political system has done in these years. It is necessary to understand what is happening in Brussels, given that Brussels has demonstrated that it can change national governments, as happened recently for Italy.