Completing the Project Europe

Sottotitolo: 
A “Constitutional Monster “ has allowed the “technocrats” to gradually  absorbe a neo-conservative ideology that is taken as absolute truth. The only consistent drive  to deal with the crisis is  the political unity of Europe.

A“ Project Europe”  exists since the end of the Second World War , and it  has been until now  the leading trend in  Europe . The idea  came  since 1943 from the antifascists Altiero  Spinelli e Ernesto  Rossi who from the prison  criticised the National State  and proposed the United States of Europe. The project was meant to prevent  another  European War , and therefore  another World War ,  and  to pool the efforts   to rebuild  what the war had destroyed. It was a project of the defeated , Germany , Italy , and also France , while the winner,  Great Britain , kept its distance until  much later. The USA, after the experience of the Marshall Plan , supported it  as an instrument  to confront  the  Russian-controlled Eastern Europe. The project was not immediately supported by all  European  political parties.  The main supporters were the Christian Democrats,  the bigger  party in Germany , Italy and Belgium. The Socialist position was not negative in Germany, quite suspecting  in France  and  Italy.

The idea of a “capitalist conspiracy  “ was quite  common in the European left wing. The Communist were strongly against it  , at least until  the dissolution  of  the URSS,  because they saw it as  tied up to  NATO  and to the American position in the Cold War. Generally speaking, the European left wing considered the United Europe as a “capitalist  operation”, which the working class  should refuse. The absence  of the left wing  from the Project Europe had important  consequences. The idea  put down  roots without them  and  their long time absence  is risking now  to  make it exactly what they were fearing.

The European States, although weakened by the war,  did not disappear , and a  two-levels  structure was  built , creating  a  Constitutional problem still not   solved.

The European Project  adopted  a “technocratic” structure , not based on the  popular will  expressed through  the electoral mechanism, but on agreements  among  Governments, a  “constitutional monster”,  often operating  along lines  not be acceptable  to  the European electorate. There is no doubt, however, that the idea of a United Europe, somewhat  represented by   Bruxelles, has  dominated the European debate ,  and it  has produced  a series of quality jumps in European history.  

First , the Common Market gave  impulse to the European economic development , and established Europe as one of the  strong economic areas of the world.
Second, the collapse  of the Soviet Union  and of Eastern Europe was dealt with to minimise    the potential explosive character of such a realignment  of different countries.   The “enlargement of  Europe” created  problems between established members and new comers , but the readjustment  of the European map was done quickly  and peacefully, and was a success.
Third, the creation  of the Euro, a currency  ranking  above the dollar. Of course, money without a State  is an even bigger “Monster” . The Euro  was created  by negotiations  among the Governments , and the people was not called  to discuss the operation which was never  fully explained , and  was  often seen as a matter of  national pride.  The Euro required an European Central Bank ,  which would  not answer to anybody. This was true also of the National Central Banks , which  however felt in a way or another the   interest of their country. The great differences in economic level   in Europe  does not allow that , and the Central European Bank  has a somewhat , at least on paper , restricted job, that of avoiding inflation. 
Fourth, the Shengen system of internal movement inside the area  was an popular novelty, not completely  cancelled   by  the  fear of terrorism .

Finally ,  a group of more or less self appointed men tried to write a project of Constitution. A Constitution ,  history  tells us , is  a basic document that can be written  in moments of great creative tension,  and by men and women chosen to  represent  the people. None of these conditions were present, and the process didn’t go anywhere.

It is interesting to note   that the UK did not participate in the  three last drives, showing the   coldness   of that country , involved in a   project of political and administrative  decentralisation, to the European project.
 
A general evaluation of the process up to now must  be favourable . However, a structure not exposed to democratic control ends easily by absorbing   the positions of lobbies   and mainstream thinking , coming from the big banks   and from  the USA. Moreover , the rich and powerful countries in  Europe,  have  more say than the poor ones  , and  tend to consider  their  interest to be the truth, that must be accepted  by everybody.  The interest of working people is never felt  by the “technocrats” of the “Constitutional Monster “,  and they  have gradually  absorbed some quite strange propositions , that are by now taken as absolute truths, that cannot be discussed. 

As a first  question , the  function  of the Central Bank   is to avoid inflation. The minimum  sign of increasing prices  gets an immediate answer, an increase of the cost of capital, and a slow-down of the economy. It does not matter if the  inflation  comes  from the prices of  imported materials, like oil, or grain,  which are driven by speculation.  The Brusselles people did very little  to try to rein  in speculation, which , for example, has increased the price of oil a hundred times since the  early fifties.
Moreover ,  the poorer countries of Europe  which adopted the Euro  cannot devalue  it .  They have therefore  no way to reduce their debt , and are in the hands of lenders  who menace them with “default”  if they do not satisfy  their punishing request, that is , of the same large international banks that  originated    the crisis. So, the only solution for these countries  is now to reduce public expenditure,  which, in turn, depresses their economy, and reduces further the level of welfare  of the poorer layer of society.   Fundamentally,  Brusselles  is imposing a strategy of deflation , and  reduction of investments in infrastructure,  in countries  that  don’t have it , and have to create  if they want to grow.
Again ,  the high level of the Euro  allows European countries to export only goods , like  complex machinery ,which have little competition in the world , while simpler goods are imported  from poorer countries, with  lower currencies.  In this condition , the less rich  countries in the Euro area   cannot develop their  economy . If the poor gets to be poorer,  aggregated demand will  not increase,   the market for industrial goods will shrink even more  , and the  rich exporter will  have  to find different outlets, or reduce prices.

In conclusion , the very institution  that created the European boom  is now creating conditions  that are not conducive to development , but to stagnation.  The final conclusion of this trend would be to reduce Europe to a club of rich people , exactly the opposite of the original thinking. 

The official political and financial  solutions to the financial crisis are all of the “negative“ kind , that is, reducing the presence of the State in the economy,  even if it  is   the only guarantee of a minimum of equality among the citizens. Every State  must prevent the dis-equality among citizens to increase ,  as it is happening in the US, where the power of the rich becomes an established  constitutional  power,  and  the poor vote for the rich. The conditions imposed to  a number of European countries   to reduce drastically their debt  mean  a  steady reduction of their economies,  and , basically, an increase  of the dis-equality  among their citizens. This risks to become the project of the rich to make  the poor poorer , both among countries  and among men. 

So, is there another line , another road that may be taken?

There is no doubt  that the  road  we have followed up to now  for the integration of European countries   has brought progress in the economy and in other areas, including the all important , and not yet completed,  free movement of people  and possibility of working in every country. This line must not be abandoned.  The only possible road   to avoid this negative development we are seeing now is that of reducing , or , better , cancelling  the “Constitutional Monster” and the democratic deficit  of the European structure.

The only positive outcome is the political unity of Europe , which  is certainly not  easy. This must be done by introducing the voice  of the European people  into the bureaucratic structure of the  Union. The European Parliament must be brought up to the level  of a modern Parliament. It must be the voice of the people , and the seat  for choosing the Government of Europe.  It may be that Europeans are not yet fully aware  of the present trend, and that they might be disappointed  by what is happening. However, the problem cannot be solved  without an important innovation,  the creation of a  real European Parliament.

This Parliament exist , but his powers are  limited . The  reduction of the constitutional problem could be performed  by steps, enlarging the power of the  Parliament gradually. That may not mean creating a Federal State ,  where the various functions  of the  Federation  and of the State  are clearly distinguished . These are often changing  even in historical  Federal States like the USA.

 If the left wing still exists in Europe , now is the moment of putting  all  possible energy  on such a  development. 

Marcello Colitti

Economist. He was President of Enichem. His last book is "Etica e politica di Baruch Spinoza". Member of the Editorial Board of Insight