France’s new President Francois Hollande is meeting Germany’s tried and tested Angela Merkel probably at this very minute.
The Euro, which will no doubt form the centre-piece of their deliberations, was, and remains, a brave venture, a departure from the politics of nation states and superpowers, globalisation and international money markets. For the first time ever a monetary project sought to bring together 17 different countries – a bold vision indeed. In this sense the Euro is the logical conclusion of setting up the European Union. Once the EU had established a political agreement, the Euro began the process of economic co-operation.
In this sense it is right to call the Euro a political project. And this is the very reason why Europe’s leaders from Angela Merkel to the European Commission do not want the Euro to fail. While I do not agree that if Greece were to leave the Euro this would mean the disintegration of the EU, its departure would seriously undermine the bold vision for Europe.
Mrs Merkel and the European Commission see this clearly, maybe even thinking that if Greece goes the whole Euro project will fail. Their response – severe austerity – is, however, beginning to look as if it will not work in the longer term.
Austerity should not continue for the simple reason that the people of Europe who have been to the polls recently have not supported Mrs Merkel’s point of view. Sunday’s elections in North Rhine Westphalia, Germany’s largest Land, saw Merkel’s CDU vote slump by eight per cent to an all-time low of 26%. The centre-left SDP social democrats did well boosting its share of the vote by five per cent to 39%. The liberal FDP also gained support.
While there may have been local factors at play in this internal German election, the result comes on top of Francois Hollande’s victory on a platform which included growth as well as austerity. We should also not lose sight of the result of the election in Greece. The Greek people have suffered more than any others in the EU and they are clearly saying no to austerity. The fact that the Greek election results have not delivered a government should not blind us to what the results are saying, which is a clear no to austerity.
The European Commission, Angela Merkel and the rest of Europe’s political leaders would do well to take on board that the many people in three EU member states have made their voices heard against strict austerity.
EU leaders are often quite rightly accused of being out of touch. The people have actually spoken over the past few months. The European Union – composed as it is of the world’s leading democracies – must take these voices on board. If they do not, the bold vision will flounder even further off course.
Meanwhile Shadow Chancellor Ed Balls hit the nail on the head regarding Britain’s role in the EU. According to today’s Guardian he told a Centre for European Reform seminar, “I don’t remember a time when British economic and political leaders in our country were less influential in debates which had more profound significance for jobs and growth in our economy.” Under the Tory-led coalition David Cameron and George Osborne are nowhere. The final irony is, if Greece were to leave the Euro, they would probably receive IMF money to which the UK had made a contribution. Standing aloof from the Euro does not let us off the hook in today’s integrated world.