Interview with Jean-Claude Juncker 'Europe Will Either Succeed or Fail Together'

AFP

Part 2: 'I Would Favor a President Who Is Directly Elected by EU Citizens'


SPIEGEL: Germany wasn't the only place where people were upset about the outcome of the summit. In Portugal and Ireland, for example, many wonder why they should strictly adhere to requirements while more lenient conditions are now being applied to Spain and Italy. Can you understand that?

Juncker: That's precisely why our summit statement includes a sentence stating that countries in a similar position must be treated equally. I attach a great deal of importance to this principle.

SPIEGEL: Does this mean that Portugal and Ireland can hope for the same relief that's been made available to Spain and Italy?

Juncker: Portugal and Ireland are fulfilling the European requirements in an exemplary manner. Both countries have been very successful at balancing their budgets. For that reason, they are entitled to be subject to the same rules that apply to others as long as their situation is comparable to the situations of others.

SPIEGEL: Greece is also asking for more time to implement the planned reforms. Are you willing to negotiate?

Juncker: The troika will submit its report on Greece in September, and then we'll address the issue.

SPIEGEL: But the report's conclusions are foreseeable. Greece is falling far behind the reform targets. If you grant the government in Athens yet another deferral, you won't be able to avoid additional aid. Wouldn't it be better for the country to withdraw from the currency zone now, at least temporarily?

Juncker: The fact is that the Greek government has not implemented the program as agreed. This had to do with the elections and the suspension of the privatization program. It's also clear that it will cost money if we give Greece more time to reach the agreed goals. This leads to two questions. First, are the Europeans prepared to pay the additional costs? Second, will the International Monetary Fund remain on board? Before these things are clarified, I can't answer your question.

SPIEGEL: Your own finance minister, Luc Frieden, says that we ought to think about the "geographic composition" of the euro. What does he mean?

Juncker: You'd have to ask him. There is a proposal to divide the currency zone into a north and a south euro. There is also the idea of setting up a core monetary union in the middle of Europe. I disapprove of these debates. Instead, we should devote all of our efforts to supplementing the monetary union with a political union.

SPIEGEL: You and the presidents of key EU institutions presented relevant proposals at the summit. To summarize: Important powers in fiscal policy would shift toward Europe, and debt securities like euro bonds would be introduced in return. Are you satisfied with how European leaders reacted to your ideas?

Juncker: There was considerable agreement over our proposal to establish a European banking union. But some of the other proposals were more controversial.

SPIEGEL: You can say that again! Germany, Finland and the Netherlands are strictly opposed to joint debt, while France and others are bristling against a transfer of sovereignty to the European level.

Juncker: But the two things belong together. You can't have euro bonds without more interconnection among the national budget policies.

SPIEGEL: The chancellor said that there would be no euro bonds for as long as she lives. You are exactly the same age as Merkel. Would you sign on to that pledge?

Juncker: The future will show who was right. I'm convinced that, in the long term, a monetary union includes a joint debt policy under strict, mutually agreed upon conditions. To that end, we submitted our concepts at the summit.

SPIEGEL: You propose that the governments should only be allowed to take on new debt within narrow limits, and that anything exceeding those limits would have to be approved at the European level. The question remains, how do you intend to democratically validate this shift of decisions to Brussels?

Juncker: It's a real problem. We have to redraft the parliamentary structures of the monetary union. It would make sense to entrust the European Parliament with portions of budgetary control. But I don't see a willingness to do so in the majority of capitals at the moment. That's why the national parliaments have to be incorporated more deeply into this task. It would also make it easier to explain to citizens if their directly elected election-district representative determined what happened to tax money.

SPIEGEL: What can be done to make Europe more appealing to people once again?

Juncker: I would favor creating the office of European president at the end of the process, a president who is directly elected by EU citizens. As a preliminary step, the offices of the European Council president and the European Commission president could be combined. The Lisbon Treaty doesn't rule this out; it would be the precursor to a European president.

SPIEGEL: Wouldn't there have to be a European finance minister, as well?

Juncker: That would make sense. On thies issue, there are also possibilities within the existing EU treaty. The position of EU commissioner for economic and monetary affairs could be combined with the office of Euro Group chairman. That job would be a great challenge for anyone who assumed it. On the one hand, he would have to make proposals. On the other hand, he would have to negotiate compromises with his European counterparts.

SPIEGEL: Wouldn't that be a job for you? After all, you were re-elected at the last Euro Group meeting, even though you actually wanted to step down.

Juncker: Absolutely not. After my election, I immediately announced that I would not be available for the entire term. I hope that a successor is found by early 2013.

SPIEGEL: According to Merkel's and French President François Hollande's plans, German Finance Minister Wolfgang Schäuble would assume the position initially, to be replaced later on by his French counterpart, Pierre Moscovici. How do you feel about the idea?

Juncker: I don't know what exactly Mrs. Merkel and Mr. Hollande discussed. Decisions can only be reached in Europe if France and Germany agree. But it's also true that going it alone doesn't make you very popular with the other member states. To put it clearly: In my view, Schäuble meets all the requirements to become head of the Euro Group.

SPIEGEL: Prime Minister Juncker, we thank you for this interview.

Interview conducted by Michael Sauga and Christoph Schult

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sbanicki 07/24/2012
1. Fail it is!
Zitat von sysopIn a SPIEGEL interview, Euro Group President and Luxembourg Prime Minister Jean-Claude Juncker, 57, discusses the dispute between Germany and Italy at the recent EU summit, why he believes Merkel is wrong about euro bonds and his desire to have an elected president of the European Union. http://www.spiegel.de/international/germany/0,1518,844453,00.html
If that is the choice, I am afraid fail it will be. The only way for the euro to survive is if parts of Europe politically unite under one constitution and one governing body elected by the citizens of the new amalgamated country. In order for anyone to believe this will happen, he must be one highly intoxicated optimist. There are 27 countries in the European Union from Germany with a population of 81.7 million to Malta with 417 thousand citizens in 2011. Only 17 of these countries use the euro. Europe, and the world, needs to plan for the end game. The dissolution of the euro is inevitable. We need to plan now to minimize the negative impact. The impact will be negative, it is the degree of impact that is yet to be decided. The six most populated countries of Germany, France, United Kingdom, Italy, Spain and Poland have combined populations of 355 million. This is slightly larger than the United States. In 2010 the GDP of these six countries totaled $12.7 trillion in nominal dollars while the GDP of the U.S. totaled $14.6 trillion. It becomes easier to trade between "countries" if they are all a part of one sovereign state. It is being Pollyanna to believe this will actually happen. There is much bad history between these countries, pride and tradition for each country runs deep, each country has its own taxing system and all have different social programs for their citizens.More: http://www.freeourfreemarkets.org/2012/07/united-state-of-europe.html#more
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