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III European Debate: What’s Europe after the crisis?

- The fate of common European currency is uncertain. Euro shall disappear when the political wish of its survival vanishes. If the management of crisis in the “Europe’s soft underbelly” shall fail, currency catastrophe is imminent – said Lajos Bokros, member of Budget Committee and Economic and Monetary Affairs Committee of European Countries during the public debate which took place in the office of “Polityka”.

Full video record in multimedia library.


Four Pythias in mist of crisis

                17th November 2011 III European Debate took place in the office of “Polityka” co-organized by the Bronisław Geremek’s Foundation, Centre Civilisation Française at  Warsaw University and French Chamber of Industry and Commerce in Poland. The discussion was dedicated  to one of  the most important challenges that the contemporary world of politics, economy and culture is facing: the economic crisis in Europe. Question, that was asked in the title of the meeting – What’s Europe after the crisis? – was guiding debaters’ towards future, therefore the moderator, Adam Krzemiński, journalist of “Polityka”, European and Polish-German matters specialist, described the participants of the panel as fortune-tellers attempting to foresee the economic future of our continent in the nearest  time as well as in the long multi-year perspective.

The roles of economic Pythias performed following:    

Lajos Bokros –European Conservatives and Reformists Group Member, member of the Committee on Budgets and Committee of Economic and Monetary Affairs; Minister of Finance between 1995–1996 in the government of the Hungarian Republic; lecturer at many European Universities,    among others the Central European University in Budapest. 

Stanisław Gomułka – main economist of the Business Center Club; advisor to the Ministry of Finance and to the president of the National Bank of Poland; between 1989 and 1995 negotiated with the International Monetary Fund the issue of macroeconomic programs for Poland, whereas between 1990 and 1992 negotiated polish debt reduction plan with the Paris Club and London Club. 

Maciej Witucki – the president of the French Chamber of Industry and Commerce in Poland; the president of the Polish Telecom; chief of the program council of the Polish Civil Forum (PFO) a Council Member of the Bronisław Geremek Center Foundation

Philippe Rusin – direktor of Centre Civilisation Française at Warsaw University; economist; research worker at Paris-VIII Vincennes Saint-Denis University; associate of IUT in Tremblay-en-France, CNRS as well as CEFRES.

Adam Krzemiński began the meeting with an outline of an ongoing debate in Germany about constitutional changes (binding decisions shall be most probably taken in 2013 alongside the parliament elections), which would aim at stabilizing the future crisis management process.
The recurring idea of founding United States of Europe would lead to further and gradual transfer of power by the governments of member states to the EU structures. Therefore a question was raised if similar discussions are conducted in other countries and in what form do their echoes reach Brussels?

Lajos Bokros remarked that an alternative “more or less of Europe?” is one of many recent tendencies in the policy of the European community and as a matter of fact, no one knows which of them shall succeed in the foreseeable future. The new package of Europe’s management currently discussed in the European Council assumes that the principle of national governments’ influence on the policy and economy was strengthened as a result of the crisis, whereas also noticeable is a significant rise in importance of the European Commission which desires to assert its prestige and image. Nevertheless the crisis everyone is talking about is by no means the causative factor to the benefit of unifying, quite on the contrary: it shall result in the emergence of first, second and even third category of Europe.

                Hence may  we                assert that the crisis is impeding the unification process, or does it rather – according to the popular belief – seem to be the unifying force?

                Stanisław Gomułka indicated three main achievements of economic strategy: integrated market of products which has been successful more or less for the last 20 - 30 years, virtues of the dynamic and mobile job market and the areas of the activities of the European Central Bank. Question about the influence of the crisis on the consolidation process entails necessity for consideration of relations between monetary integration and fiscal one. Establishing of the so called Maastricht criteria, related directly to fiscal policy, was supposed to resolve any economists’ doubts. However, do the budgets of the euro zone respect the restrictions included in the legacies?
Well, some countries have repeatedly  ignored the criteria in question in the recent years, which led to public crisis outbreak, which independent markets began to have influence on – it resulted in dramatic differences in interest rates. Currently there are no economic and politic mechanisms through which the risk of financial markets could be remarkably reduced, and yet state of uncertainty is a fatal circumstance for the economy, isn’t it? What is more, it’s the politicians decide about possible penalties and not the economists. It essential to find serious solutions…Tight cooperation must occur between individual member states – without a better financial umbrella policy of countries in good financial condition, the euro zone shall collapse.

                Adam Krzemiński remarked that the majority of potential solutions fits the framework of the old system, however the shift of “sovereignty” towards Brussels - just to shape the discipline mechanisms – would require a fresh look. Since the social opinion can still hear about mutual competency frictions between France and Germany, two most important European partners,
it would be essential to ask about the current state of debate on the crisis in France.


            Philippe Rusin, in his reference to the opinion of Stanisław Gomułka, remarked that
the American source of the crisis in Europe has been forgotten: it was the American government to decide to help the private banking system which triggered the collapse in the level of confidence in the world of finance. Political decisions must be taken immediately and although help for Greece is the evidence of European solidarity, building common Europe must be preceded by concern about the condition of own backyard. In order to benefit from the already mentioned solidarity, appropriate tasks must be accomplished: Europe demonstrates solidarity through the full and tight relations. Financial discipline is required from all the member states. Figuratively speaking: if Germany contracts an illness, Poland may catch cold at the most…

Maciej Witucki, on the other hand, deprecated rigid classification – although there are diverse specifics of unit-sates, such as Franco-German tandem, the Union must be perceived as a whole.
Well, Europe is not at crossroads, there are no hundred solutions, there are no alternatives as far as the fight against the crisis is concerned which could consist of reducing deficits and defense against financial speculation. In a state of crisis a chance should be noticed. There is still a clear need for less technocratic and impersonal Europe – unity is able to regain the stability as a result of shaping a clear profile of its leaders. There appears a chance for Poland: combination of French étatisme, German solidity and Polish energy results in approximately 200 million voting Europeans! Poland can strongly emphasize its presence in the European project but this requires abandoning internal operation reforms. Even if the union diversifies its progress, it still shall be a Europe of fast progress and even faster.

                In the second part of the debate, invited guests discussed the political aspects of the economic crisis. Question about the deficit of democratic mechanisms induced Lajos Bokros to affirm that the clearly political aspect is one of the fundamental reasons for the slow pace of integration.
If we want the citizens Europes to support the political solutions they must feel that it is their own interest, therefore may have a positive influence on their daily life. On the other hand, the already mentioned slow pace of European integration is rather appropriate. Mutual fiscal policy monitoring mechanism confirms that many countries are simply unwilling to pay for incompetence of other governments. Therefore the intention is to find a golden mean, however the fact remains that there is a diversity of development dynamics of individual countries and Europe of various progress speeds shall remain unchanged.

                Stanisław Gomułka remarked the prerequisite of designing political mechanisms of crisis management, which would reduce the risk of its relapse in the future. This is what French and German leaders are aiming their efforts at. Unfortunately Poland shall not play a major role because of its low economic potential. Therefore, European equality and partnership of Poland is in a sense a kind of wishful thinking. Reasonable solution for this situation for the whole Europe is certainly a control of budget discipline of individual countries.

          Phillie Rusin allowed himself to consider as not appropriate, the internal political actions of some polish members of European parliament who question the sense of activity on the union forum while participating national parliament campaigns. Only conscious involvement in the works on common European policy – respecting adequate competences and scope of duties – shall  enable the building of international agreement taking into consideration of internal perspective.   

                Maciej Witucki described the perspective of positive and also fast changes in politics, economy and culture on the point of historic moments of “windings”. Because Europeans are so much frustrated, they shall be willing to accept a sensible repair plan of the situation which would lead to the fulfilling of the dream of a union that is economically and politically stronger.  Otherwise, Europe would become a heritage park consisting of 27 parts for rich Chinese and Hindu.

            During a discussion with the public, participants faced the issues of establishing neuro, appointing a common European rating committee and chances for efficient separation of relations between the worlds of finance and politics.

            At the conclusion of the meeting, Adam Krzemiński asked debaters to reveal their prophesying skills and to imagine Europe from over ten year perspective. Will the political union approach the ideal of European demos? Even within the context of the theme of the whole meeting, the responses seemed only moderately optimistic: the role of Europe shall change significantly the next years and although the commitment for the idea of the union should not reduce civil requirements from the point of view of a national state, the Europe of homelands shall remain a solid achievement of the integration process. May it be however the Europe of Heimats not Vaterlands.

Jacek Głażewski