European Council On Foreign Relations: EU Needs To Use Crisis For Greater Power
Renowned financial commentator denounces “fiscal fascism”
Friday, May 14th, 2010
Several more autocratic international voices have added their weight behind proposals to vastly empower the EU with greater authority to govern over nation states in Europe, in the wake of the sovereign debt crisis. Meanwhile, one leading commentator has described the move as “fiscal fascism”.
Proposals tabled yesterday by the European Commission, the legislative arm of the EU, would greatly diminish the ability of nation states to set their own fiscal policies, in favour of a move toward a centralized european treasury.
“There is still a long way to go. We have opened the gate. Now we have yet to go through it,” said Ulrike Guerot, an analyst at the European Council on Foreign Relations think-tank.
“The crisis has shown us we need to animate moves toward closer political union as well as monetary union and we need a quantitative jump.” Guerot added in comments to Reuters.
“The EU has used crises in the past to make that kind of jump and this is what is needed now.” the German researcher concluded.
“This could be the fuel injection needed to put Europe on course toward closer political and economic union, the goal that drove its founding fathers and leaders a generation ago such as Germany’s Helmut Kohl, France’s Francois Mitterrand and former European Commission President Jacques Delors.” notes Reuters writer Timothy Heritage.
The European CFR is a vehemently pro-EU outfit made up of hundreds of influential corporate and political figures, perhaps most notably including George Soros. It was initiated three years ago primarily to push for an expanded role for the EU as a global superpower. Inevitably, the group is consistently vocal when it comes to the question of greater political integration in Europe.
The European CFR is not related to the U.S. CFR, however support for mass centralization in Europe is shared. On the prospect of a central European treasury, CFR Senior Fellow Marc Levinson notes:
“Countries cannot have it both ways. Either they’re in the eurozone or they’re out. If they’re in, they have no control over their monetary policies, period. If they want to leave, fine, but then they will probably have to leave the EU as well, and to remain out of the EU and the eurozone for a very long time. And leaving the eurozone, by itself, will solve none of their economic problems.”
Other voices echoing support for sweeping integration measures include Hans Martens, chief executive of the European Policy Center think-tank in Brussels, who notes “This is the last chance to still be relevant in the world… It’s clear to everyone that Europe is becoming marginalized.”
“Europe faces a critical choice between greater integration and disintegration,” Simon Tilford, chief economist at the Center for European Reform think-tank, also wrote this week.
Former Federal Reserve Chairman Paul Volcker and Former U.S. Treasury Secretary John Snow have also advocated the move toward a fiscal union.
“Will economic and financial distress finally be resolved by looking toward more integration in a closely integrated Europe, politically as well as economically?” said Volcker. “I do have my hopes, as a believer in the euro.”
“For the euro to be able to survive long term, fiscal consolidation of some kind — tax policy consolidation, fiscal policy consolidation — is probably necessary,” Snow said.