The next European Council of June 28-29 will be - also in the light of the Greek elections - yet another step in the EU’s journey. 27 leaders will once again jointly seek to identify crisis-recovery and growth-boosting measures. Gianni Borsa, SIR Europe correspondent, addressed the issue with Edoardo Ongaro, Ordinary Professor of International Public Services Management at Northumbria University in Newcastle, U.K, visiting professor at the Bocconi University in Milan.

What is your opinion of the “exit strategies” proposed to date by the EU?
“They lack a long-term vision. Moreover, governing and administrating are complex tasks, all the more so in a multi-level political and institutional context such as the European one. But if we look at Europe as a whole, I wonder if the so-called “formative agencies” (first and foremost political parties, as well as institutions and universities…) have appropriately formed and selected a high-level political class. In my opinion while some leaders are trying their best to develop efficient solutions, an equally engaging commitment is lacking on the part of a large part of the European ruling class”.

Do Member States intend to step up true European economic governance, which appears to be a necessary basis to increase the competitiveness of the European system whilst safeguarding the single currency?
“It’s hard to say. As it’s hard to say if supranational European institutions such as the Commission and European Parliament are efficiently prompting Member States’ involvement for the development of European governance. Is the EU still the “integration engine?” Or could it do much more in this direction?”.

The public opinion understands that national leaders have differing stands. Is it possible to provide a snapshot of the various models?
“There are at least four models. Two are the most debated ones, and probably they are also the ones that are mostly present in the minds of decision-makers. They can be called austerity model (to make order in each Country) and growth model through new European tools (such as project bonds, Eurobonds, and the sharing of a quota of public debt). The other two can be found in academic reflection. The third is based on the assumption that the European social-economic model is no longer sustainable owing to competitive pressures triggered by globalization. The path that must be undertaken is to draw inspiration from the US, which must occur at national level first”.

And the fourth model?
“The fourth model is the one whereby the European social model (social market economy and welfare institutions, starting with universal and free health assistance) is part and parcel of EU identity, on the cultural plane, although it is not provided for in the treaties. According to this model, a federal governance is indispensable also to encash the ‘dividend of federalism’ (if Europe were a sole political and economic unit its accounts were be much sounder that those of the US and Japan, for example), but at the same time united Europe won’t survive unless the welfare systems are reformed so as to ensure their balance and recovery, since the European social model makes the EU unique at world level”.

Is there a way out - supported at political level or in academic environments - that can be considered closer to a “federalist” model of European integration?
“I think the fourth model is more realistic than one could imagine. To a certain extent its implementation depends on the possibility of ‘raising the stakes’: namely, to step up federalism in the short term period, as demanded by the proponents of growth through new European tools, in exchange for reforms aimed at the renewal of the European social model. These reforms are to be preferred to austerity as relates to the system’s long-term performance. Will the all the players in the field be capable of being so far-sighted as to play for a rise instead of playing for a fall? We indeed witnessed the poor results of playing for a fall. A good intermediate result was recently achieved by Martin Wolf: a union of guarantees (in case of serious crises, guarantees must be provided at collective level and almost automatically to the country in difficulty), accompanied by a union of adjustment (namely, not only countries in difficulty but also those with positive growth trends must adjust their inflation and expense rate)”.

Which path should be undertaken? How should the problems affecting the financial sector, real economy and unemployment be addressed?
“Appropriate interventions can be of help - such as approaching bank bailouts with a federal approach, namely, directly bank capital interventions by European institutions - provided this approach is marked by a long-term vision. If not, European public opinions will not feel involved and will seek other solutions, at national or regional level. I believe they would be disappointed. But the only other option is a more over-arching vision of Europe”.

20/06/2012 -