Jacques Delors knows the EU’s single currency, the euro, inside out – even the downsides. During his time as president of the European Commission – between 1985 and 1995 – he witnessed the birth of Economic and Monetary Union in Maastricht in 1992.
He has seen all sorts of European Union crises unfold; but the current problems surrounding the euro concern him deeply. Not because they are insurmountable, but because they highlight the deterioration of the principles on which the EU was constructed.
Jacques Delors has headed up the ‘Notre Europe’ think tank since 1996. And in an interview with Laura Davidescu of euronews, he expressed his anger but also his pragmatism. The European debt crisis, he said, can be contained with the tools already available to the euro zone.
euronews: “Monsieur Delors bonjour! First, could you tell us how you feel when you see the European Union project in such difficulties.”
Jacques Delors: “I’m worried and I have regrets. I especially regret that when the euro became operational, during the decision-making in 1997 they rejected my idea for an economic policy coordination pact alongside the Stability and Growth Pact.”
Euronews: “Who rejected it?”
Jacques Delors: “I think the heads of governments rejected it. If we’d had that, the euro wouldn’t have covered up mistakes made by certain people, but it would have stimulated the euro, and also, in discussions with each other, they would have noticed that private debt in Spain was mounting to dangerously high levels, that the Irish government was turning a blind eye to the mad deals made by the banks, etc, etc, but they didn’t do it.”
euronews: “But why?”
Jacques Delors: “Why? Because, leaving aside this business of the economic policy coordination pact, which they’re now coming back to in one form or another, but it’s a bit late now. The problem which has arisen from the Greek difficulties is simple: do we apply the “no bail out” as written in the Treaty which states that there will be no systematic help for a state which runs into difficulties.
“Or does the Eurogroup feel that it is morally responsible for not letting the situation worsen in these countries, and that being morally responsible it takes political decisions to address the problem. That’s the idea I’ve been putting forward, especially to the Germans, telling them ‘But we are collectively responsible, we cannot simply point the finger at the naughty Greeks’.”
euronews: “You say that the idea of an economic government for the euro zone, as proposed by Nicolas Sarkozy and Angela Merkel, would not be useful.”
Jacques Delors: “If Mr Sarkozy and Mrs Merkel supported the community method, if they didn’t spend their time trying to marginalise the Commission and cover up the difficulties encountered by President Jean-Claude Junker of the Euro-group.”
euronews: “Is that what they’re doing now?”
Jacques Delors: “That’s what they’ve done, they’ve tilted the system towards intergovernmental decision-making but it isn’t possible for 17 heads of government or finance ministers to define economic policy. We need to go back to the community method, give the Commission back it’s role in decision-making.
“If you marginalise the Commission, if you swap Mr Junker for Mr Van Rompuy to do the same job, then nothing changes. I see an anti-EU attitude in these two leaders.”
euronews: “ But the Commission can have a bit of pride.”
Jacques Delors: “The Commission initiates. It can therefore make proposals. If these proposals are not accepted, it can explain to the press, and thus to EU citizens. That’s the threat I used when they wanted to put off adopting the Erasmus programme. I told the President of the European Council – Mrs Thatcher – ‘You know, at our joint press conference, I’m going to say that you don’t want this student exchange programme.’ They changed their minds and backed the programme. This is how a system can work.
“The European Parliament plays an increasingly big role, I’m glad to say, it works well. So it only needs a few adjustments for the system to get back to healthy working methods.”
euronews: “For you the keys is ‘returning to the principle of reinforced economic cooperation’.”
Jacques Delors: “Yes”
euronews: “What would that mean?”
Jacques Delors: “I say you have to isolate the Greek case and deal with it. You can’t simply say, punish Greece or even just say ‘Get out of here!’ Secondly and most importantly, base actions on decisions we have already made to try and support the euro, leading to the issue of euro-bonds.”
euronews: “Mrs Merkel says she’s against euro-bonds.”
Jacques Delors: “The governments have decided via a small amendment of the Treaty, to create a European Stability Mechanism. I suggest this mechanism be put in place by 2012. And I think this should issue the euro-bonds. So in a practical spirit, I say it is possible to graft these euro-bonds onto the European Stability Mechanism which is the result of an existing intergovernmental agreement, so I wouldn’t take any risks with the Treaty. And secondly, I suggest that the European Investment Bank increase its operations and also issue euro-bonds, not to consolidate the debt, but to cover future expenses.”
euronews: “If a lack of fiscal and budgetary union is what’s destabilising the euro to that extent, isn’t the answer to be found in fiscal union?”
Jacques Delors: “I feel that we are building a Union of diversity. But when we go from 27 to 17, meaning Economic and Monetary Union, well then diversity has to take a back seat, otherwise it’s not possible. With the Single European Act in 1985 which I proposed, I said it is based on three principles: competition which stimulates, cooperation which strengthens, and solidarity which unites. Cooperation is the missing link. But if that doesn’t work, or if the euro project ends and Europe simply becomes a vast free trade zone, a “loose confederation” as the British say, or if they decide to make a new Treaty with more federalism at the top…”
euronews: “But Mr Delors, this Europe isn’t speaking with one voice.”
Jacques Delors: “All these leaders who are talking, do they care that the Presidency of the European Council is Polish? Do you think the way the Polish presidency is ignored is a good thing?”
Euronews: “You think it’s being ignored?”
Jacques Delors: “Yes, it’s being ignored! And do you think that that is a good sign for Europe? Same thing with this scandal – Finland and Slovakia demanding special guarantees in order to take part in the Greek rescue plan. It’s a scandal! As soon as Finland said that, the European Council ought to have met and said NO, that’s not possible. It’s the spirit is being diluted, the community spirit in a way, the feeling of belonging to a collective enterprise. That has to be deplored. We Europeans, we’re not just Europeans by law, because ‘the EU makes us strong’ – we are Europeans in our hearts, and that’s what’s missing today.”