Gouvernement économique de la zone euro et légitimité démocratique.

« Une autre histoire aurait pu s’écrire si dès février 2010, les responsables de la zone euro avaient accepté le vrai diagnostic : l’UEM allait être d’autant plus victime de la crise, née sur des marchés financiers, qu’elle souffrait de l’inachèvement de sa construction et plus particulièrement du déséquilibre entre ses piliers économique et monétaire. »

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The need for automatic stabilizers at the Eurozone level and the way to create such tools were the two questions raised by Employment and Social Affairs MEPs during a public hearing on Tuesday. This was the first debate on the issue, after the last European Council asked for reinforcing the social dimension of the EMU and for a better monitoring of social aspects.

Automatic stabilizers are necessary

Experts, in their presentation, underlined the lack of automatic stabilizers in the Union, i.e. social benefits to compensate wage decline when economy moves into recession. Because of this, even if the Eurozone had better economic fundamentals before the crisis, it was more hit by the crisis than the United States where the same diversity of situation among states could be observed, they say.

The use of fiscal policy to stabilise the economy in the EMU is quite limited because of trade channels and since countries which experienced financial difficulties had to cut social benefits, instead of having stabilizers, they added.

« The Commission takes this issue very seriously » said Georg Fischer, Director at DG EMPL in reply to questions by MEPs, citing the creation of a Working group, following the Blue print – Commission’sdocument for a strong and stable architecture for the future of the Economic and Monetary Union-. The Working group will soon publish its recommendations, he announced.

Towards a European unemployment insurance system

Experts suggested the creation of a European unemployment insurance system as a possible stabilizer. Such a system would need to be « light », « transparent » and « simple », they highlighted. Questions remain about the design (transfer mechanism or insurance mechanism) and the incentives for creating such a system.

MEPs raised questions about the budget of such a tool and asked whether the setting up of a minimum income would be more efficient. They also asked questions about the competence of the EU in this field and the involvement of social partners. The estimated budget of such a system is to be roughly 50 billion euros, according to one of the experts.

To conclude the debate, the Employment and Social Affairs Committee Chair Pervenche Berès (S&D, FR) reminded the setting up of a pilot project on this issue in the European Parliament. The Added Value Unit of the Parliament is also studying the feasibility of a legislative initiative on the matter.

Background

The Employment and Social Affairs Committee organised on 9 July a hearing on the Social Dimension of the EMU. The speakers invited were: Georg Fischer, Director for « Analysis, Evaluation, External Relations » at DG EMPL, European Commission; Thomas Philippon, Associate Professor at Stern School of Business, New York University; Ferdinand Fichtner, Policy advisor at Deutsches Institut fuer Wirtschaftsforschung (DIW) and Manuel Caldeira Cabral, Economist, University of Minho (Portugal).

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Pour les socialistes européens, c’est l’aboutissement d’un long combat qui a commencé avec le rapport préparé par Pervenche Berès pour la commission spéciale sur la crise financière, économique et sociale.

Face à la droite, la bataille était incertaine sur le nombre de transactions frappées par cette taxe. Les socialistes sont fiers d’avoir remporté la bataille en faveur d’une assiette large : les fonds de pension ne seront pas à l’abri !

Parce que l’Europe joue sa crédibilité, il est maintenant crucial que le Conseil introduise dès que possible la TTF.

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