Reconciling Governance and Model: A Five-fold Narrative for Europe

Publication with the support of the IED, the European Parliament and Madariaga

14.09.2013


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How is it that the euro, which could provide the springboard for Europe to project itself as a robust economy and a global player in the 21st century, is surreptitiously turning into a deadly trap, not only for the eurozone itself, but potentially for the Single Market and therefore the whole EU? It is indeed increasingly obvious that, without a central last resort lender and a central fiscal backstop for sovereigns and banks which only a central budget and a banking union can secure, the eurozone will operate below its growth potential and above a sustainable level of unemployment. The eurozone is today working as a machine for creeping deflation, for divergence between North and South and for growing inequalities within countries. Can intergovernmental incrementalism trace a path back towards growth from the overindebtedness of sovereigns and banks while ensuring the integrity and the cohesion of the eurozone? Or can leapfrogging into a federal monetary union alone consolidate the political construction of Europe in an age of economic stagnation and strategic uncertainty? Could such a move be achieved without a radical reworking of strategic thinking in Europe? These reflections are building up on a set of original and robust contributions made by five prominent economists and lawyers during the conference held by the IED and the Madariaga-College of Europe Foundation at the European Parliament on 25 April 2013.


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Reconciling Governance and Model: A Five-fold Narrative for Europe