Unanimity rule paralysing European economic policy

Since the emer­gence of the Greek finan­cial and eco­nom­ic cri­sis, Italy has always approved and encour­aged an Euro­pean coor­di­nat­ed action to resolve the sit­u­a­tion. As Prime Min­is­ter Berlus­coni main­tained, if the EU is not will­ing to help a mem­ber of the Euro area afflict­ed by a severe eco­nom­ic cri­sis full of per­ilous poten­tials, then the EU has no rea­son to exist.11Reuters: Gre­cia Berlus­coni: Unione Euro­pea deve dare aiu­ti, 21 March 2010, avail­able at: http://it.reuters.com/article/topNews/idITMIE62K02M20100321 (last access: 26 April 2010).
On the same line, the Ital­ian Min­is­ter for Finance and Econ­o­my Giulio Tremon­ti, com­ment­ed that the finance pack­age to sup­port Greece was the right thing to do.22La Repub­bli­ca: Atene alla pro­va bond: 16 mil­iar­di entro Mag­gio, 26 March 2010, avail­able at: http://ricerca.repubblica.it/repubblica/archivio/repubblica/2010/03/28/atene-alla-prova-bond-16-miliardi-entro-maggio.html (last access: 26 April 2010). More scep­ti­cal, how­ev­er, was the oppo­si­tion leader Enri­co Let­ta, high­light­ing how the deci­sion to involve the Inter­na­tion­al Mon­e­tary Fund (IMF) unde­ni­ably dis­cards the idea of a pos­si­ble Euro­pean Mon­e­tary Fund (EMF).

In this par­tic­u­lar regard, the research com­mu­ni­ty and var­i­ous opin­ion-mak­ers have adopt­ed a rather severe and rigid posi­tion. Indeed, the agree­ment on the first res­cue pack­age, announced at the end of March 2010, has been described as a last minute solu­tion, in which Ger­many seems to have obtained the most con­ces­sions.33Pao­lo Guer­ri­eri: Europa delle patrie, Affar­In­ter­nazion­ali, 29 March 2010, avail­able at: http://www.affarinternazionali.it/articolo.asp?ID=1428 (last access: 26 April 2010). Accord­ing to a com­ment which appeared in the Ital­ian lead­ing eco­nom­ic jour­nal Il Sole 24 Ore, the finan­cial pack­age was a rea­son­able out­come aimed at low­er­ing the risk of moral haz­ard. Ger­many is right in its restric­tive approach to the Greek sit­u­a­tion, and to deem the cre­ation of an EMF a futile and com­pli­cat­ed oper­a­tion.44Alber­to Alesina/Roberto Per­ot­ti: Pro­ces­si­amo le cicale greche non le formiche tedesche, Il Sole24Ore, 27 March 2010, avail­able at: http://www.ilsole24ore.com/art/SoleOnLine4/dossier/Italia/2009/commenti-sole-24-ore/27-marzo-2010/salvataggio-grecia-accordo-francia-germania.shtml?uuid=f773d266-3978–11df-9fa9-1d4f0b3be0c7&DocRulesView=Libero&fromSearch (last access: 26 April 2010). Although nec­es­sary, Daniel Gros sug­gest­ed that the IMF is not able to offer Greece enough mon­ey, and that the EU will prob­a­bly have to par­tic­i­pate with its own resources.55Daniel Gros: Dilem­mi Gre­ci, La Voce, 23 March 2010, avail­able at: http://www.lavoce.info/articoli/-europa/pagina1001622.html (last access: 26 April 2010). In con­clu­sion, it has been not­ed that politi­cians should not con­fuse Euro­pean patri­o­tism with finan­cial irre­spon­si­bil­i­ty, since the future of the whole EU eco­nom­ic project is involved.66Francesco Giavazzi: Più che un fon­do serve cor­ag­gio, Cor­riere del­la Sera, 11 March 2010, avail­able at: http://www.corriere.it/editoriali/10_marzo_11/giavazzi_e253ab20-2cd2-11df-a00c-00144f02aabe.shtml (last access: 18 May 2010).

Fol­low­ing the lat­est finan­cial and polit­i­cal devel­op­ments of the Greek cri­sis, includ­ing the trag­ic death of three peo­ple in Athens on 5 May 2010, an improved Euro­pean res­cue pack­age has been prompt­ly announced. With the real­is­tic dan­ger of a mas­sive Euro­pean finan­cial infec­tion, the Ital­ian press shift­ed its atten­tion to the polit­i­cal aspects of the cri­sis, ask­ing for a sub­stan­tial and rapid inter­ven­tion, which indeed mate­ri­alised.77Mar­co Ona­do: Ora la polit­i­ca curi l’infezione, Il Sole24Ore, 7 May 2010, avail­able at: http://www.ilsole24ore.com/art/SoleOnLine4/dossier/Italia/2009/commenti-sole-24-ore/7‑maggio-2010/crisi-euro-politica-curi-infezione.shtml?uuid=6d2c43b4-599d-11df-acb8-823383602e85&DocRulesView=Libero (last access: 10 May 2010). In this regard, the Ital­ian gov­ern­ment expressed sat­is­fac­tion with the 750 bil­lion Euro agree­ment, with the Pres­i­dent of the Ital­ian Repub­lic Gior­gio Napoli­tano prais­ing the Ital­ian role dur­ing the polit­i­cal nego­ti­a­tions.88Cor­riere del­la Sera: “Il pre­mier ha sbloc­ca­to i negoziati”. Napoli­tano “Italia ha fat­to la sua parte”, 10 May 2010, avail­able at: http://www.corriere.it/economia/10_maggio_10/chigi-napolitano-frattini_fd247162-5c1d-11df-92dd-00144f02aabe.shtml (last access: 10 May 2010). Nev­er­the­less, some ana­lysts not­ed that this solu­tion rep­re­sents only a sec­ond best, and that the EU ulti­mate­ly needs to reform its eco­nom­ic insti­tu­tions, cre­at­ing auto­mat­ic mech­a­nisms to effec­tive­ly con­trol future crises.99Tito Boeri/Tommaso Mona­cel­li: Non aggiun­giamo miopia alla miopia, La Voce, 10 May 2010, avail­able at: http://www.lavoce.info/articoli/-europa/pagina1001702.html (last access: 10 May 2010).

Mario Draghi, cur­rent Bank of Italy’s gov­er­nor and can­di­date to head the Euro­pean Cen­tral Bank, not­ed that one of the main results of the Greek cri­sis has been to under­line the need for a more robust and com­pre­hen­sive Sta­bil­i­ty and Growth Pact (SGP).1010La Stam­pa: Draghi: Gov­er­no eco­nom­i­co Ue e con regole più severe, 20 March 2010, avail­able at: http://www.lastampa.it/redazione/cmsSezioni/economia/201003articoli/53316girata.asp (last access: 26 April 2010). Gen­er­al­ly, the same opin­ion is shared by Ital­ian politi­cians and pub­lic opin­ion. Stricter rules are deemed nec­es­sary, and the Euro­pean Com­mis­sion should be allowed to indi­cate targets/actions and, when required, impose the Europe 2020 Strat­e­gy.1111Anto­nio Vil­lafran­ca: The future of Euroland after the Greek cri­sis, ISPI Pol­i­cy Brief n. 179, March 2010, avail­able at: http://www.ispionline.it/it/documents/PB_179_20101.pdf (last access: 26 April 2010). But the reform of the SGP can­not be lim­it­ed to sanc­tions. Indeed a struc­tur­al approach able to offer a more sol­id and bal­anced Euro­pean eco­nom­ic organ­i­sa­tion is also need­ed.1212Gian­car­lo Corset­ti: Cam­bi­amo il Pat­to di sta­bil­ità, La Voce, 16 Feb­ru­ary 2010, avail­able at: http://www.lavoce.info/articoli/pagina1001560.html (last access: 26 April 2010).

As has been high­light­ed, how­ev­er, the Greek cri­sis is both eco­nom­ic and polit­i­cal. There­fore, any reform has to find a com­mon polit­i­cal agree­ment among the EU mem­ber states, which seems to be, accord­ing to the last analy­sis, the main prob­lem of an EU in which the cur­rent glob­al finan­cial cri­sis has brought an acute mutu­al dis­trust.1313Anto­nio Mis­siroli: Of Greek and gifts, ISPI Com­men­tary, 4 March 2010, avail­able at: http://www.ispionline.it/it/documents/Commentary_Missiroli_4%20marzo%202010.pdf (last access: 26 April 2010).

The pos­si­bil­i­ty of a Euro­pean eco­nom­ic gov­er­nance, which has been sug­gest­ed on sev­er­al occa­sions dur­ing the Greek finan­cial cri­sis, has remained rather unex­plored in Italy. Nev­er­the­less, some ideas have emerged from the pub­lic debate. Finance Min­is­ter Tremon­ti, for instance, admit­ted the need for a Euro­pean direc­tion of pub­lic invest­ments, the first step towards an improved coor­di­na­tion between mem­ber states’ eco­nom­ic poli­cies.1414Giulio Tremon­ti: Un ruo­lo per il Fon­do mon­e­tario nel sal­vatag­gio del­la Gre­cia, Il Cor­riere del­la Sera, 6 March 2010, avail­able at: http://www.corriere.it/economia/10_marzo_06/tremonti-grecia-fondo-monetario_c2a71ffc-28f2-11df-a5a9-00144f02aabe.shtml (last access: 26 April 2010). More­over, the insti­tu­tion of new agen­cies aimed at the cre­ation of a finan­cial reg­u­la­tion sys­tem could be a com­plex devel­op­ment for the Euro­pean econ­o­my, since such a sys­tem would have to be suc­cess­ful­ly applied to all the mem­ber states of the Euro­zone. After all, the cred­i­bil­i­ty of the whole EU is at stake, and the con­se­quences that a fail­ure or a weak sys­tem could trig­ger are indeed per­va­sive.1515Nico­las Veron: Il fal­li­men­to che l’Europa non può per­me­t­ter­si, La Voce, 23 April 2010, avail­able at: http://www.lavoce.info/articoli/pagina1001661.html (last access: 26 April 2010).

In a nut­shell, a coor­di­nat­ed gov­er­nance of the Euro­pean econ­o­my is a vast polit­i­cal oper­a­tion, in which all the Euro­pean insti­tu­tions should receive a pre­cise and improved role. Ital­ian researchers and politi­cians appear rather favourable in prin­ci­ple, but it will take time before a con­crete agree­ment is going to be reached.1616Romano Pro­di: La spec­u­lazione, l’Europa divisa e la sper­an­za di Kohl, Il Mes­sag­gero, 9 May 2010, avail­able at: http://www.romanoprodi.it/articoli/italia/speculazione-europa-divisa-e-la-speranza-di-kohl_1494.html (last access: 18 May 2010).

Just after the release of the Commission’s pro­pos­al for a new Europe 2020 Strat­e­gy, the Ital­ian gov­ern­ment expressed sup­port for the doc­u­ment, in par­tic­u­lar with regard to its ref­er­ences to inno­va­tion, the val­ue of small/medium enter­pris­es, and the atten­tion posed on inter­na­tion­al mar­kets.1717Gov­er­no Ital­iano: Strate­gia Europa 2020 con­di­visa dal Gov­er­no Ital­iano, 3 March 2010, avail­able at: http://www.governo.it/Presidenza/Comunicati/dettaglio.asp?d=56062 (last access: 26 April 2010). The Ital­ian Min­is­ter for Finance and Econ­o­my, Giulio Tremon­ti, called the text inter­est­ing, as long as it is not under­stood as an instru­ment to incen­tivise pub­lic expen­di­ture by the mem­ber states.1818ANSA: Tremon­ti a Ue, strate­gia 2020 non sia ban­co­mat spe­sa, 16 March 2010, avail­able at: http://notizie.it.msn.com/business-news/articolo.aspx?cp-documentid=152597706 (last access: 26 April 2010). More­over, fol­low­ing the Fran­co-Ital­ian sum­mit of April 2010, both par­ties have argued that a stronger role for Com­mon Agri­cul­tur­al Pol­i­cy should be insert­ed in the final ver­sion of the Strat­e­gy.1919ANSA: Strate­gia 2020 Italia e Fran­cia pun­tano sull’agricoltura, 30 March 2010, avail­able at: http://www.newsfood.com/q/3600765e/strategia-europa-2020-italia-e-francia-puntano-sullagricoltura/ (last access: 26 April 2010).

How­ev­er, the eco­nom­ic pro­vi­sions con­tained in the doc­u­ment are prob­a­bly not enough. In fact, it appears to be indis­pens­able to also deal with the struc­tur­al weak­ness­es of the Euro­pean eco­nom­ic project, like the una­nim­i­ty rule, which is ulti­mate­ly paralysing most present EU actions. Only in this way does a bet­ter and more coher­ent eco­nom­ic future for the EU seem achiev­able.2020Giampiero Gra­maglia: Europa 2020 chi fa da se fa per tre, Affar­In­ter­nazion­ali, 4 March 2010, avail­able at: http://www.affarinternazionali.it/articolo.asp?ID=1404 (last access: 26 April 2010).

    Footnotes

  • 1Reuters: Gre­cia Berlus­coni: Unione Euro­pea deve dare aiu­ti, 21 March 2010, avail­able at: http://it.reuters.com/article/topNews/idITMIE62K02M20100321 (last access: 26 April 2010).
  • 2La Repub­bli­ca: Atene alla pro­va bond: 16 mil­iar­di entro Mag­gio, 26 March 2010, avail­able at: http://ricerca.repubblica.it/repubblica/archivio/repubblica/2010/03/28/atene-alla-prova-bond-16-miliardi-entro-maggio.html (last access: 26 April 2010).
  • 3Pao­lo Guer­ri­eri: Europa delle patrie, Affar­In­ter­nazion­ali, 29 March 2010, avail­able at: http://www.affarinternazionali.it/articolo.asp?ID=1428 (last access: 26 April 2010).
  • 4Alber­to Alesina/Roberto Per­ot­ti: Pro­ces­si­amo le cicale greche non le formiche tedesche, Il Sole24Ore, 27 March 2010, avail­able at: http://www.ilsole24ore.com/art/SoleOnLine4/dossier/Italia/2009/commenti-sole-24-ore/27-marzo-2010/salvataggio-grecia-accordo-francia-germania.shtml?uuid=f773d266-3978–11df-9fa9-1d4f0b3be0c7&DocRulesView=Libero&fromSearch (last access: 26 April 2010).
  • 5Daniel Gros: Dilem­mi Gre­ci, La Voce, 23 March 2010, avail­able at: http://www.lavoce.info/articoli/-europa/pagina1001622.html (last access: 26 April 2010).
  • 6Francesco Giavazzi: Più che un fon­do serve cor­ag­gio, Cor­riere del­la Sera, 11 March 2010, avail­able at: http://www.corriere.it/editoriali/10_marzo_11/giavazzi_e253ab20-2cd2-11df-a00c-00144f02aabe.shtml (last access: 18 May 2010).
  • 7Mar­co Ona­do: Ora la polit­i­ca curi l’infezione, Il Sole24Ore, 7 May 2010, avail­able at: http://www.ilsole24ore.com/art/SoleOnLine4/dossier/Italia/2009/commenti-sole-24-ore/7‑maggio-2010/crisi-euro-politica-curi-infezione.shtml?uuid=6d2c43b4-599d-11df-acb8-823383602e85&DocRulesView=Libero (last access: 10 May 2010).
  • 8Cor­riere del­la Sera: “Il pre­mier ha sbloc­ca­to i negoziati”. Napoli­tano “Italia ha fat­to la sua parte”, 10 May 2010, avail­able at: http://www.corriere.it/economia/10_maggio_10/chigi-napolitano-frattini_fd247162-5c1d-11df-92dd-00144f02aabe.shtml (last access: 10 May 2010).
  • 9Tito Boeri/Tommaso Mona­cel­li: Non aggiun­giamo miopia alla miopia, La Voce, 10 May 2010, avail­able at: http://www.lavoce.info/articoli/-europa/pagina1001702.html (last access: 10 May 2010).
  • 10La Stam­pa: Draghi: Gov­er­no eco­nom­i­co Ue e con regole più severe, 20 March 2010, avail­able at: http://www.lastampa.it/redazione/cmsSezioni/economia/201003articoli/53316girata.asp (last access: 26 April 2010).
  • 11Anto­nio Vil­lafran­ca: The future of Euroland after the Greek cri­sis, ISPI Pol­i­cy Brief n. 179, March 2010, avail­able at: http://www.ispionline.it/it/documents/PB_179_20101.pdf (last access: 26 April 2010).
  • 12Gian­car­lo Corset­ti: Cam­bi­amo il Pat­to di sta­bil­ità, La Voce, 16 Feb­ru­ary 2010, avail­able at: http://www.lavoce.info/articoli/pagina1001560.html (last access: 26 April 2010).
  • 13Anto­nio Mis­siroli: Of Greek and gifts, ISPI Com­men­tary, 4 March 2010, avail­able at: http://www.ispionline.it/it/documents/Commentary_Missiroli_4%20marzo%202010.pdf (last access: 26 April 2010).
  • 14Giulio Tremon­ti: Un ruo­lo per il Fon­do mon­e­tario nel sal­vatag­gio del­la Gre­cia, Il Cor­riere del­la Sera, 6 March 2010, avail­able at: http://www.corriere.it/economia/10_marzo_06/tremonti-grecia-fondo-monetario_c2a71ffc-28f2-11df-a5a9-00144f02aabe.shtml (last access: 26 April 2010).
  • 15Nico­las Veron: Il fal­li­men­to che l’Europa non può per­me­t­ter­si, La Voce, 23 April 2010, avail­able at: http://www.lavoce.info/articoli/pagina1001661.html (last access: 26 April 2010).
  • 16Romano Pro­di: La spec­u­lazione, l’Europa divisa e la sper­an­za di Kohl, Il Mes­sag­gero, 9 May 2010, avail­able at: http://www.romanoprodi.it/articoli/italia/speculazione-europa-divisa-e-la-speranza-di-kohl_1494.html (last access: 18 May 2010).
  • 17Gov­er­no Ital­iano: Strate­gia Europa 2020 con­di­visa dal Gov­er­no Ital­iano, 3 March 2010, avail­able at: http://www.governo.it/Presidenza/Comunicati/dettaglio.asp?d=56062 (last access: 26 April 2010).
  • 18ANSA: Tremon­ti a Ue, strate­gia 2020 non sia ban­co­mat spe­sa, 16 March 2010, avail­able at: http://notizie.it.msn.com/business-news/articolo.aspx?cp-documentid=152597706 (last access: 26 April 2010).
  • 19ANSA: Strate­gia 2020 Italia e Fran­cia pun­tano sull’agricoltura, 30 March 2010, avail­able at: http://www.newsfood.com/q/3600765e/strategia-europa-2020-italia-e-francia-puntano-sullagricoltura/ (last access: 26 April 2010).
  • 20Giampiero Gra­maglia: Europa 2020 chi fa da se fa per tre, Affar­In­ter­nazion­ali, 4 March 2010, avail­able at: http://www.affarinternazionali.it/articolo.asp?ID=1404 (last access: 26 April 2010).

The reports focus on a report­ing peri­od from Decem­ber 2009 until May 2010. This sur­vey was con­duct­ed on the basis of a ques­tion­naire that has been elab­o­rat­ed in March and April 2010. Most of the 31 reports were deliv­ered in May 2010.

The EU-27 Watch No. 9 receives sig­nif­i­cant fund­ing from the Otto Wolff-Foun­da­tion, Cologne, in the frame­work of the ‘Dia­log Europa der Otto Wolff-Stiftung’, and finan­cial sup­port from the Euro­pean Com­mis­sion. The Euro­pean Com­mis­sion is not respon­si­ble for any use that may be made of the infor­ma­tion con­tained therein.