Respecting agreements

The rough path of the single currency, and from a wider perspective, that of European integration, will reach their destination after the summer holidays. Even if we wished to support the thesis of optimism and of the irreversibility of the euro currency – repeatedly announced by EU institutions, by the European Central Bank and by national leaders in recent weeks – a set of pitfalls remain that must be overcome in the short term – by the end of 2012 -. Failure to do so would result in Community implosion.Decisions, distinctions and u-turns. As expected, the first problem is of political nature. The crisis that has been holding Europe, its economy, its enterprises, its workers, and its families in its grips for the past four years should be addressed with determined “team work” of Member States’ governments in order to jointly pursue the solutions identified by EU Member States in EU Council meetings, with the external support of the Commission and European Parliament. The end-of-June heads of Government-and-State summit led to an agreement enhancing a set of key issues such as the innovative anti-spread shield, the ambitious growth pact, the banking union project, the project for economic and budgetary union. These are major goals, for the achievement of which a set of steps had been undertaken in the previous months. Finally, having been put into writing, they we expected to turn into consistent commitments. But unfortunately, once the euphoria of the summit faded away, once the lights on reverberating statements addressed to the public opinions of each Country were turned off, critical stances were pronounced since early July, along with restrictive interpretations of the agreements, second thoughts, and delays.European Parliament and Commission. It is not a coincidence that the European Parliament gathered in Strasbourg at the beginning of July raised a call of alarm: a resolution approved by a large majority of MEPs stressed the dangers underlying the hesitations and deferrals established by summit participants, and urged the Commission to submit operative proposals on the decisions taken by the Council of June 28-29 within next September, without further delays. President José Manuel Barroso could meet the challenge and present a set of related legislative proposals during the 10-13 September plenary, such as a proposal on banking union. On the other hand, a set of decisive steps – i.e. the ‘six pack’ and the launch of the project bonds – were taken when EU Parliament and Commission decided to join forces…Bilateral meetings and official reunions. But the endless stream of statements from European politicians in the midst of the summer heat, that lasted until the end of August (notably, the attacks of several German personalities on Greece’s permanence in the euro area and on ECB responsibilities, offset by milder declarations by Chancellor Merkel), sometimes conflicting with each other, have certainly helped to clarify whether the EU27 countries truly intend to continue working together to find a “political” solution to the crisis first. Objective economic and financial difficulties are coupled by legitimate national interests, by public opinions, by questionable steadiness of the governments in power (Spain and Greece face the possibility of internal instabilities), along with upcoming national elections (Germany, but also Italy, will go to the polls in 2013). A series of bilateral meetings between EU leaders scheduled for the end of August -beginning of September (involving Merkel, Hollande, Rajoy, Samaras, Juncker, Monti …) may help to clarify matters. Equal importance is ascribed to the meeting of the Central Bank bureau in Frankfurt on September 6 and to the Eurogroup meeting in Brussels on 14 September.The decision of the German Court. Political hesitations are determining when coupled by the adoption of European resolutions at national level – which represents yet another hanging question. In this framework, the greatest problem is linked to the German Constitutional Court’s ruling on the compatibility of the European Stability Mechanism (ESM) with the German legal system. The decision – which bears major relevance on the political and juridical planes – is due to be issued by September 12. In the meantime – the third element of tension – financial markets pressures, concerns over sovereign debt and “real economy” figures continue. Eurostat has certified the nth downward bend of many EU countries’ GDP. It is once again evident that the paths of politics, law and the economy should return to be interlaced in a virtuous direction, in order to shape those responses that markets, and before them EU citizens, expect of Europe.