71st International Atlantic Economic Conference

March 16 - 19, 2011 | Athens, Greece

Lessons from the Greek Tragedy : Europe Needs Economic Governance

Thursday, 17 March 2011: 18:00
Maria Lianou Mrs, MA, PhD Candidate, , Supreme Council for Personnel Selection (ASEP), Egaleo,Athens, Greece
The current financial crisis is the worst in post-war economic history. It affected the EU showing the need for real economic governance in Europe through the convergence of fiscal policies. Up to now, there is economic administration only in the monetary section. The need for economic governance is a political choice for the confrontation of the economic problem, and an economic demand for the effective use of economic assets.

Today the fiscal policy remains under the appositeness of EU member-states, but comes under common rules which are enacted by the Treaty of the EU and the Stability and Growth Pact.

Lisbon Treaty is not enough for integrated economic governance in the EU. The integrated economic governance must concern all member-states, not only the Eurozone. So a prerequisite is that all the member-states must adopt Euro. This will be done when they are able to have strong economies.

Economic governance and European political integration are issues interrelated. Economic union is a necessary prerequisite for the future political union of the EU. European integration implies European Federation.

The states would not leave easily their fiscal policy in a supranational level. It is a sensitive political section for national governments. Nevertheless, they should try. A coordination of the fiscal policy is necessary: this will favor the societies and will reduce the economic gap and the asymmetry between member-states. EU must act in order to stop objections. The nation state does not die, it is reformed. European integration must go on.

The economic asymmetry between the member-states of Eurozone. In the case of the Greek fiscal problem an ad hoc mechanism of support was created; a loan of 110 billions of euro (30 billions of euro from the IMF and 80 billions of euro from the Eurozone). However, an ad hoc mobilization is not adequate. A unified centre of economic policy is needed and with it associated progress towards economic and political integration is essential.

EU needs an adequate number of resources. Now, the European budget represents only the 1% of the European GDP. This must be increased up to a substantial percentage able to support economic development and civil protection of the member-states.

EU needs a direct European tax in order to be able to promote its policies.

EU needs redistribution of institutions in order to promote cohesion between the regions of the member-states.

The members of the ECOFIN Council must have the power to act like the Ministers of Economy in their countries.

Lisbon Treaty is not a perfect text. We need a new Treaty, a Constitutional Treaty.

EU started as an economic community. Economic union, financial integration and economic integration are the next step. The collapse of the European construction is in no one’s interest. We need positive integration based on trust and on the idea of constructing a better future that will reinforce the EU in the internal level and in the global level. Only then EU will achieve to be the most dynamic and competitive economy in the world.