In the fortnight since I last wrote a piece for this blog, things appear to have shifted in the EU. The Irish ‘yes’ to the Fiscal Pact (by a clear margin, if less than enthusiastic) and the pressure on Greek and Spanish banks seem to have pushed member states towards a ‘more Europe’ type solution. With Angela Merkel calling today for just this, we might consider that we are moving into the next phase of the eurozone crisis.
This would be wrong though. As Alex Barker noted in the FT, there are any number of basic problems with a banking union, which looks to be the current gambit. In particular, the banking union ideas suffer from the same problem as the Fiscal Pact, namely that they are at best medium-term solutions, rather than short-term ones. The difficulties of finding common ground on fire-fighting have pushed policy-makers horizons much further out than the situation requires. Even the Daily Mail noted this point, albeit in its usual mock-portentous language.
Part of the problem is the conflation of the eurozone crisis with the EU more generally. Clearly, the two are related, but the awkwardness of the debate around the latter in the post-Constitutional Treaty era has leaked heavily into the former: the collective failure to secure a strong embedding of the European integration process into citizens’ lives has contributed to the current problems of grounding positive action on the eurozone into a sense of collective responsibility. At the elite level, there is an understanding that everyone’s in it together (something that even the most sceptical of governments has worked out), but the framing of public debate has been about where to lay the blame.
In particular, the language of ‘debate’ on the EU in general – of ‘more’ or ‘less’ – has become the default for all discussion. Ultimately, this is not helpful, reducing the EU to a false mono-dimensional approach that obscures very much more than it reveals. If collective action by member states and the EU is to be successful, then it needs to recognise the multiple aspects of monetary integration and the possibility of temporary solutions in a time of extreme financial distress.