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More discipline to avert default

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More discipline to avert default

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Elena, from Paris, asks: I’d like to know how the European Union could really oblige the euro zone countries to respect budgetary discipline in the use and reimbursement of loans received during the course of this debt crisis.

Sylvie Goulard, an MEP with the Alliance of Liberals and Democrats for Europe, responds: “That’s an excellent question and I believe that, yes, in return for the help that these countries in difficulty receive, there must be serious commitments on their part. What we would like is that these countries get out of their difficulties so that the money we have given them is not, in the end, wasted.

“At the same time as the European Commission, the International Monetary Fund and the European Central Bank work with these countries, we in the European Parliament are seeing to the reinforcement of the disciplinary rules, and we hope that tougher procedures and sanctions will have a dissuasive effect. I believe far more in persuasion than in sanctioning, which is to say we have tried to improve dialogue between the new Europe and national levels further upstream.

“We have to get past the myth which says we would be completely masters in our own states at the same time as having the single currency. That is a lie. So, we are very attached to strengthening preventive procedures, and I also believe each EU member state must do its own job of persuading.

“The accounts must not be cleaned up to please Brussels because there is a kind of mad technocrat there who has it in for people, but simply because a lot of member states have been living beyond their means, and things can’t go on that way.

“The best prevention is to start doing things, to show the markets and also the people and economic players that there is a real will to avoid reverting to this sort of addiction to public indebtedness.

“The best prevention is to start doing things, to show the markets and also the people and economic players that there is a real will to avoid reverting to this sort of addiction to public indebtedness.

“If some countries trip up completely, we might turn out to have mobilised a lot of money for nothing. On the face of it, that’s not what we wanted, and I believe we have to try to avoid that. Why?

“Because the reputation of the country in question would be seriously harmed. We do not have a choice between a difficult way imposed by Europe and other, easy, solutions. Default would be, a disaster for the countries in question in the first place, even before becoming contagious.”