Wednesday

28th Sep 2022

Opinion

Making Europe's economy work for its citizens

  • "Society, not the markets, should come first" (Photo: West Midlands Police)

In coming days, we will be given another opportunity to further improve the European economy and the lives of our citizens. Our leaders are set to discuss new steps to strengthen the Economic and Monetary Union (EMU) when they meet at the European Council later this month.

As Ministers of European Affairs of six EU countries with social-democratic governments, we want to see a courageous reform which will further enhance the EMU’s functioning and credibility. In our opinion, more needs to be done to ring-fence European economies and the European Social Model.

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The Euro is one of the greatest achievements of the EU. Having a shared currency has brought tremendous political and economic benefits to citizens and has helped to mitigate negative effects of the global financial and economic crisis in Europe. Nevertheless, the crisis has also revealed that a common currency is not enough.

Given the well-known shortcomings, however, we want to make sure that the Economic and Monetary Union works best for the people’s well-being. Therefore, we argue in favour of a fairer, more democratic EMU that supports economic growth and is people-oriented.

To achieve these goals, the union needs a strong social pillar. The crisis and austerity policies have severely affected the lives of millions of people in several European countries. It has revealed how urgent it is to equip the Economic and Monetary Union with a real social dimension that offers solutions to current social challenges, notably the dramatic unemployment.

In our opinion, this could be achieved through viable reform programmes that introduce minimum social standards, including decent minimum wages according to the level of economic development of individual Member States. Society, not the markets, should come first.

We also want an EMU that fosters economic growth. Fiscal responsibility needs to be coupled with socially balanced reforms and investments to speed up the recovery of our economies. Sound finances are not an end but a prerequisite for strong social systems. We need a stronger “E”, i.e. a real Economic Union as part of the EMU. In practice, this means greater coordination of economic policies also to bridge inequalities between and within countries in the EMU.

We need to ensure that balanced budgets do not come above social inclusion nor the sustainability of welfare states. Our goal for the EMU is economic stability, social cohesion and full employment. We therefore envision more safeguards to secure that citizens no longer pay for the mistakes of the banking sector as well as budget solidarity with countries experiencing a severe economic shock resulting in a sudden increase of unemployment.

Europe’s sound economic recovery should be a common objective of all, with fiscal and social justice at the core of these efforts. To fight tax evasion and tax avoidance, countries should automatically exchange tax-related information, discourage aggressive tax planning, and close tax havens. In addition, fiscal measures ensuring equal and redistributive taxation, supporting a shift to greener economy, and limiting financial speculation should also be introduced and strengthened. To this end we support the rapid introduction of a Financial Transaction Tax.

Lastly, we want a more democratic EMU. It is our responsibility to restore citizens’ confidence in the European Union and ensure they have a say on policies affecting them. The way to do this is to reinforce both, the European Parliament’s role and Member States’ ownership of decisions taken within the EMU. We support a better cooperation between the European Parliament and national parliaments, we want a true partnership of parliaments in Europe.

As Ministers for Europe of social-democratic governments, we seek to achieve these objectives within the existing legal framework. However, no measure should be off-limits and therefore, we will consider all potential measures needed in order to complete the EMU in the medium and long term. Our vision is a union that is inclusive, promotes a strong social model, ensures economic sustainability, and influences lives of European citizens in a positive way.

Miroslav Lajčák, Deputy Prime Minister and Minister for Foreign and European Affairs, Slovakia; Lubomir Zaorálek, Minister of Foreign Affairs, Czech Republic; Harlem Désir, Minister of State for European Affairs, France; Michael Roth, Minister of State for Europe, Germany; Sandro Gozi, State Secretary for European Affairs, Italy

Disclaimer

The views expressed in this opinion piece are the author's, not those of EUobserver.

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