state-of-europe“Muddling through” will not work. That was the view shared by all participants at Friends of Europe’s “State of Europe” event held in Brussels yesterday. There were, however, few other points of agreement at a roundtable discussion that brought together key European policy-makers, business leaders and experts to discuss the ongoing eurozone crisis. The event was seen as the “first duel” in a battle to decide whether or not there is to be EU treaty change.

Opening the discussion, EU Commission President José Manuel Barroso argued that we are at “the most critical juncture in our Union’s history” and considers the next European Council to be one of the most important meetings since the beginning of European integration. The meeting of EU heads of government, which was delayed to allow more time to negotiate the current deadlock, will now be held on 23rd October – one day short of the anniversary of “Black Thursday” when, in 1929, a crash on the New York Stock Exchange brought about the Great Depression.

Responding to the Slovakian parliament’s earlier rejection of an expanded EU bailout fund, President Barroso criticised the EU’s ponderous decision-making process:

Isn’t it strange that the IMF takes decisions by qualified majority? And we share the same currency and need unanimity? It’s absurd. I respect the sovereignty of Slovakia, but also the sovereignty of those that want to go ahead.

The Commission President was cautious about pressing for treaty change, but left himself some room for manoeuvre. “We are open to possible treaty change… but we have decisions we can make now. And by now I mean: now!” argued Barroso, thumping the table in front of him to make his point. President Barroso did appear to accept, however, the possibility of treaty change over the long-term:

This is for the medium-term… We need some time for more ambitious change [because] the public space remains more than 27 public spaces in Europe. In terms of the sense of belonging to a single European community, there’s a lot to do.

Duncan Niederauer, the current CEO and Director of the New York Stock Exchange (NYSE) Euronext, spoke after Mr Barroso and urged Europeans to take the crisis seriously:

The word ‘unprecedented’ gets over-used, but in this case it’s worth it. This is a challenge of unprecedented magnitude… It is critically important for business and political leaders to work together.

Tony Barber, Europe Editor for the Financial Times, summed up the discussion at the event:

The single most important topic that was on everyone’s minds was: guess what? Treaty change. Why is it that treaty change keeps on popping its head over the parapet? It’s because the question of the balance between national sovereignty and European integration hasn’t been settled.

Some were fiercely opposed to suggestions of opening up the treaties. Egidijus Meilunas, Lithuania’s Deputy Minister for European Affairs, argued that we already have all the necessary tools at our disposal:

I don’t think it’s rocket science. I don’t think we need treaty change. We’re all in debt. All the member-states are in debt. The problem is the lenders don’t trust us… It’s like a boat with a hole in the bottom. You need to plug the hole… We don’t need treaty change for that. We simply need to follow through with the promises we’ve already made… This doesn’t need another three to five years of headaches and breaking swords.

Joaquín Almunia, Vice-President of the Commission, agreed – arguing that the governments of Europe were not ready to embark on another lengthy debate about treaty change:

The problems were everywhere, but the main problem was at the Council. The member-states were not politically aware of what was at stake. Each country tried to find its own solution; ignoring the possibilities for a euro-wide solution. They tried to find solution through a piecemeal strategy… To embark on a treaty change is a very risky operation. I don’t recommend it. We are not mature enough for this.

Others, however, were adamant that only through treaty change would the EU be able to finally draw a line underneath the crisis. Stefano Micossi, Director General of ASSONIME, a business association in Rome, as well as a Professor at the College of Europe, argued that:

If it was just a matter of putting the house in order, then we would need no treaty change… But in order to rescue the euro, we will need to use monetary support by the ECB to an extent that, in many countries, public opinion sees as inconsistent with the treaties… We will then need to move toward quasi-fiscal union.

Micossi went on to argue, however, that treaty change could be undertaken quickly and efficiently if the scope of the treaty was limited to the 17 eurozone members instead of involving all 27 EU states:

The new treaty is going to be a euro treaty, nothing like the Lisbon treaty.

We’ve had a lot of discussion on Debating Europe about this very topic. Some of our commenters, like Protesilaos from Greece, have argued that the only sustainable solution to the eurozone crisis is a complete overhaul of the treaties and full fiscal union. Others have argued that even the current arrangements are a step too far in terms of sacrificing national sovereignty.

What about YOU? Do you agree with those calling for a new EU treaty? Or do you think we just don’t have time to re-open old wounds? Let us know your opinions in the form below, and we’ll take them to policy-makers and experts in the run up to the EU Council meeting on October 23rd for their reaction.

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9 comments Post a commentcomment

  1. avatar
    Christos Mouzeviris

    Well it is obvious that SOMETHING NEEDS to be done and soon..The way things stand are right now just don’t work..I know that many politicians are either afraid to put to their citizens or their parliament another ratification process, or they are listening to powerful lobbies back at home..but if we need to solve this mess we need to act…i am more inclined to agree with Mr Barosso on this..perhaps not a treaty, but definitely an agreement for now..

    “This is for the medium-term… We need some time for more ambitious change [because] the public space remains more than 27 public spaces in Europe. In terms of the sense of belonging to a single European community, there’s a lot to do.”

    The above express my sentiments exactly…Get to work..(sorry no table here to thump!!)

  2. avatar
    Peter Schellinck

    Having witnessed the discussions it does seem that a sense of urge exists. Wether we need to press for treaty change or not, we need to press above all for decisions and actions to the benefit of the European project and the European citizens. They are using the Euro and, in spite of seeing consumption more expensive, have duly accepted it’s entry. Economics have followed, politics stalled! It’s high time we stop talking about treaties here and there and actively proceed with the European integration. Make the internal market truly free and let us know how much we can save by doing so! It will be billions. With these funds we could finance the SME’s and give the civil servants who wish to leave a starters pack to join the SME’s. At the same time cut the military costs and consolidate all national fancy armies into the EuroNato. Use the freed up money for education. Allow the industry to close a partnership charter with the schools to come up with a job for degree guarantee. And with the sovereign debt allow national governments to exchange it for national sovereignty in favor of the European Parliament. In time we only need regional administrative boundaries and not national boarders. Please do save EUROPE now or face a Euro-winter with lots of social hotspots and declining belief. The little confidence still there can be saved if the politicians will be brave this coming summit. Forget elections at the moment and make sure we still will have an electorate! It looks like the way we are conducting democracy to be the long but secure route to communism… Stop, look, listen and get on with it.

  3. avatar
    Christos Mouzeviris

    “Please do save EUROPE now or face a Euro-winter with lots of social hotspots and declining belief”…How true…The declining belief is already a reality, even in countries that were formerly pro-European in their attitude overall…Like Greece and Ireland..More and more people are against the euro and EU..The project is losing out in popularity hugely..And who can blame the people..? When all they see is benefits for the rich..How can you expect them to support the euro or EU, when it is them who must pay the price and all they see is their leaders bowing to the Banks and the Corporate Multinationals..Haven’t you noticed that they are taking down to the streets protesting? All over the world! So what are you going to do about it..?? We are watching!

  4. avatar
    Jason O'Mahony

    Speaking from an Irish perspective, say it quietly, for fear of causing heart palpitations across the Irish political spectrum, but a new EU treaty is looking more and more likely, possibly as the German price for coughing up the hard earned taxes of the German people to save the euro. But if we are to have a new treaty, what should be in it?

    1. An alternative. We just can’t get into the usual Irish trick of voting No and then trying to blackmail the rest of Europe into more concessions. Therefore, as this treaty will be primarily about how national governments run their fiscal affairs, perhaps it should be outside EU law. In other words, a multilateral treaty between member states that just happen to be EU members too. This way, even if a country refuses to ratify it, the other countries can go ahead agreeing policies outside the EU which they then apply inside the EU as a group. We can add a clause that allows the treaty to be merged with the EU at a later date if every country eventually ratifies it. But it means that there is a Plan B to deal with a potential No vote, that is, we ain’t stoppin’ for no one. Countries that refuse to ratify should be respected, as should countries that refuse to bail them out anymore. After all, we must respect every country’s sovereign right to bring in massive cutbacks instead of being bailed out by other countries.
    2. A mechanism to create Eurobonds, with a veto power over issuing for any member state that will be a net contributor in terms of having to pay higher interest rates, or, alternatively, an EU tax (perhaps on petrol?) to subsidise those same countries. The beauty of a tax on petrol is that national governments could choose to shield their citizens from it by lowering other taxes, but that is a national decision for them to make. The purpose is to demonstrate to citizens of contributor nations that they are not seen purely as the EU’s cashcows, which is politically important. The Germans, Dutch and Finns vote too, you know.
    3. In return for accepting cheap Eurobonds, member states effectively cede spending level controls to the Eurozone council of ministers, again with contributor member states having a veto. The council would have a right to tie the level of spending to revenue. However, the council should be specifically barred from interfering in what types or levels of taxation are raised within a member state. The objective is to balance books, not meddle in matters of subsidiarity.
    4. The democratic issue needs to be addressed, and not through the failed European Parliament. The head of this new structure needs to be directly elected by the people of the Eurozone. As for the usual “Where is the European Demos” arguments, they are still smaller obstacles than the giant sucking sound that is European democracy. The vacuum has to be filled by voters in polling stations. After all, if we all know who Rick Perry is, I’m sure we can figure out who our candidates are.
    Of course, if British eurosceptics decide to use this opportunity to look for some concessions for Britain, this thing is going to get very messy, although long-term, having the British outside but on friendly terms would suit European integration much better. Putting Britain in a position with a Eurozone comparable to her position with the US worked out fine for the Americans, didn’t it?

  5. avatar
    Ralf Grahn

    In a globalising world the European Union needs to go further than patching up the existing Treaties between the member states.

    The EU or a core needs to advance to a union based on its citizens through representative democracy at the European level.

    Democracy and effectiveness can be achieved in the Federal Republic of Europe, with the challenges and the powers aligned at the same level.

  6. avatar
    Corrado Pirzio-Biroli

    When your house is burning, you don’t call in an architect, but the fire brigade. I agree with Stefano Micossi and Barroso. Treaty change with 27 members can no more be based on unanimity, but a highly qualified majority (e.g. 5/6th). If there had been a unanimity requirement, the US constitution would never had seen the light. However, as such a change requires an improbable treaty change, we should use the Lisbon Treaty to allow some members to move ahead (a coalition of the willing), if possible in the context of the Eurogroup but replacing intergovernmentalism with a Eurogroup freely adopting the “community method”. This is one way to abolish the veto right, which currently prevents countries from doing what is necessary to preserve the Single Market, let alone of the Union in the interest of all members. The big mistake Europa has made is to enlarge without ensuring that enlargement would not stand in the way of deepening. This has happened because some new members had reservations on the “finalité politique” of the Union. Let’s proceed towards integration now, if we still can, with those who are prepared to do so, before we make other mistakes like accepting Turkey as a member.

  7. avatar
    hari naidu

    To manage a footbal team you can’t have 27 or 17 managers!
    It ain’t gonna work…and unanimity principle is crippling not only Council decision-making process under Lisbon but also disabling the Euro Project. Either the leaders are oblivious of factual evidence or they’re simply political stooges of one side or another in crippling the concept of ever closer union.

    With some inside knowledge of the Commission and how it worked during Maastricht Treaty process – under Delor – one must acknowledge the incessant insanity of current Council work procedures and its unprincipled self-deception on on-going sovereign cum banking contagion in EU-17.

    Treaty changes are inevitable – longer term – I’m confident of that because geopolitical and economic reality will enforce some serious political navel preoccupation by (current) national leaders. History will either condemn them as perpetrators of Euro Projects (self) destruction. Thereby, more or less, fulfilling British ambition to end this game of euro mania.

    If a UK referendum is allowed, by Cameron, surely +50% will vote against EU membership. That political event by itself will be a sort of liberating moment for Euro Project – going forward.

    Meanwhile, EU has to simply STOP this caliphony of Council (Summits!) meetings before they’ve lost all their (political) marbles…and become the laughing stock of the electorate.

    BTW what does it cost to hold these incessant EU Summits?

    Community Method of decision-making has to be re-started and current inter-governmentalism a la Merkel/Sarkosy must come to a definite end (or they must be removed from the political stage!). Let Council meet atleast twice annually and not more!

    Now is the time for EP and Commission to develop a work program to re-establish Community Method of policy decision-making and focus on the immediate (single market) agenda at hand. In order to make the fiscal union and its executive functions gradually self-evident and realizable.

  8. avatar
    effie exarchoulakou

    the european trity represents a part of the unit of the european state the fact that should be improved shows the progress has made in unification actions but there other constitunational agreements which are not negotiable and if it is this can be done by the european people

  9. avatar
    Kostas andrikopoulos

    A european treaty change should be done but to the right direction. It is paramount that europe proceeds taking in account the benefit of all member states, so here is the definite issue: european fiscal union with the issue of eurobonds to close definitely european sovereign debt crisis…(of course everything should done with a strict supervising procedure so every member state respects its part of the bargain)…if this is not done I ‘m afraid that in a few years to come we will not have a european union to discuss about…it will all fall apart under the pressure of worldwide geopolitical rearrangement…

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