Must-Read: Thomas Piketty: Change Europe, Now
Must-Read: (2015): Change Europe, Now: “The extreme right has risen from 15% to 30% of the votes in France…
…unemployment and xenophobia, extreme disappointment with the left in power, the feeling that everything has been tried and that something else must be experimented… disastrous management of the financial crisis…. Only a democratic and social re-founding of the Euro zone, based on growth and employment, round a small core of countries prepared to move forward and provide themselves with appropriate political institutions, would enable us to counter the temptation to revert to nationalism and hatred which today threatens the whole of Europe….
It is important that the European leaders—in particular the French and the German—acknowledge their mistakes. We can discuss endlessly all sorts of reforms, both big and small, to be carried out in the various Euro zone countries: shop-opening hours, bus lanes, labour markets, retirement pensions, etc. Some are useful, others less so. But… this is not the reason for the sudden fall in GDP in the Euro zone in 2011-2013…. Recovery was stifled by the over-rapid endeavour to reduce the deficits in 2011-2013—with in particular rises in taxation in France which were much too heavy…. The application of blind fiscal rules… explains why in 2015 the GDP of the Euro zone has still not recovered its 2007 level….
As a first step, all the debts of more than 60% of GDP could be placed in a common fund, with a moratorium on repayments until each country has recovered a strong growth trajectory since 2007. All historical experiences show that above a certain level, it makes no sense to repay debts for decades. It is better to ease the burden clearly so as to invest in growth, including from the creditors’ point of view…. New democratic governance… the setting up of a Euro-zone parliament comprising members from the national parliaments in proportion to the population of each country. This Euro-zone Parliamentary Chamber should also be entrusted with the voting of a common corporate tax… [to] enable the financing of an investment plan in infrastructures and universities…. Europe has all the assets required to offer the best social model in the world. Let’s stop squandering our opportunities…. Before coming to plan B, proposed by the extreme Right and which the extreme Left is increasingly tempted to invoke, let’s start by giving a fully-fledged plan A a genuine chance.