The people must come first

As long as the nation-state remained strong in Europe any move towards greater political and fiscal integration to solve the eurozone debt crisis would continue to be “a very sensitive issue”, said leading historian Henry Frendo.

People could not be ignored when solutions to the sovereign debt crisis sought greater integration, he told a forum organised by the European Parliament’s office in Malta that asked where the EU was heading.

“It is also a question of demo-cracy, and change cannot be brought about by a duo playing all the instruments of the orchestra,” he said, with reference to French President Nicolas Sarkozy and German Chancellor Angela Merkel, who are calling the shots.

Drawing on Europe’s long history, Prof. Frendo said the continent had on many occasions emerged from difficult situations, and he urged a less pessimistic outlook.

He was reacting to previous interventions by Labour MEP Edward Scicluna and anthropologist Ranier Fsadni, who had spoken of the “imminent” danger of collapse the eurozone faced unless bold decisions were taken to stamp out the problem.

Mr Fsadni also warned that care had to be taken not to create a democratic deficit because of greater integration that could also push some countries to leave the EU.

Comparing the eurozone to a herd of buffalos that was strong if it acted together, Prof. Scicluna said speculators, like wolves, were targeting the weakest countries.

The problem, he noted, was Germany’s lack of trust in the ability of southern European countries to pull up their socks.

Germany wanted a guarantee that greater fiscal union and debt sharing would not mean sloppy behaviour by some countries, he added.

“Merkel wants to avoid the moral hazard through a change in the EU treaty that would bind all countries but the rest of the world will not wait for this to happen.”

An agreement by Germany and France to accept joint eurozone guarantees for sovereign debt that would ease the pressure on the weak economies would solve the crisis the day after, he said. In such a scenario, Malta would also have to decide whether it agreed with more integration and giving up more sovereignty on budgetary affairs.

Describing the EU as “a work in progress”, Nationalist MEP Simon Busuttil said the time had come for Europe to bring this political project to conclusion.

“The European project for political union is not complete and the top floor has yet to be constructed,” he said.

Dr Busuttil added that there was urgency to act quickly but insisted the final aim had to be a change in treaties.

“We have to strive for fiscal and political union that retains the diversity of the member states and then each country has to decide whether it wants to be part of this project,” he said.

Labour MEP Louis Grech concurred, adding that Europe’s fragmentation created a problem for moving forward.

The issue of democracy came to the fore when a member of the audience blamed the “ignorant elect-orate” for electing irresponsible politicians that racked up debt by spending money on social services.

Mr Grech rebutted the argument and insisted that “ignorant citizens” were not to blame for the financial crisis that had triggered the economic problems.

“If anything, the crisis was caused by those who we believed were intelligent bankers,” he retorted.

The EU’s social model was defended by trade unionist Anna Maria Darmanin, vice-president communication at the European Economic and Social Committee.

She said eroding the social safety net to patch up bad finances was counter-productive and, instead, advocated greater investment in research, development and innovation to boost jobs and growth.

ksansone@timesofmalta.com