In this hard and challenging time of coronavirus threat, it is important and useful that new Appeals are coming out every day from all over Europe.
Several initiatives have been launched:
1. A European answer to the Coronavirus threat to prove that the EU is a True Community with a Shared Future, find here: www.cesue.eu/en/appeal
2. Joint German-Italian appeal to the governments of all Member States and to EU institutions, find here: https://weareinthistogether.eu/…/european-solidarity-now-i…/
3. Open letter of European economists and other professionals to the EU institutions regarding issuing the EU bonds called “European Renaissance Bonds” to Face Europe’s Health And Economic Emergency, find here: https://europeanrenaissance.altervista.org/, and all other initiatives.
All are signs of an increasing awareness of the need of a more united, democratic and effective Europe. Now the debate is focusing on technical issues about HOW to frame a European answer.
Montenegrin Pan-European Union, through its involved members, is signatory of initiatives “A EUROPEAN ANSWER TO THE CORONAVIRUS THREAT TO PROVE THAT THE EU IS A TRUE COMMUNITY WITH A SHARED FUTURE” and “OPEN LETTER OF EUROPEAN ECONOMISTS AND OTHER PROFESSIONALS TO THE EU INSTITUTIONS REGARDING ISSUING THE EU BONDS CALLED “EUROPEAN RENAISSANCE BONDS” TO FACE EUROPE’S HEALTH AND ECONOMIC EMERGENCY”.
A EUROPEAN ANSWER TO THE CORONAVIRUS THREAT TO PROVE THAT THE EU IS A TRUE COMMUNITY WITH A SHARED FUTURE
15 March 2020
We European citizens understand that Covid-19 is a common threat that may hurt one country sooner than another, but will eventually hurt us all, and can impact our daily life and economy almost like a war.
We European citizens are worried and scared by this threat; and even more by the cacophony, selfishness and self-destructive short-sightedness of the different, un-coordinated national responses; by the lack of foresight of our national leaders, who pretend not to know that our interdependence requires a single European answer with strict containment measures of the pandemics, and an EU-wide plan to re-start the European economy afterwards.
We European citizens denounce the current EU as an incomplete Res Publica, thus ill-equipped to face this challenge, with little competences and powers to face the pandemics. We welcome the timely decision by the Commission to provide 25 billion euro and financial flexibility to cope with this threat. Maybe it is the most it can do, but it is not enough.
We call upon the European Commission and Parliament to propose, and on the national governments to adopt (starting with the Eurogroup meeting of March 16, and a following extraordinary European Council to be called soon after) the following urgent measures, also using the Lisbon Treaty passerelle clause and simplified Treaty revision provisions:
- Make public health and the fight against epidemics a shared competence of the EU, subject to the ordinary legislative procedure, and provide the Commission with extraordinary powers to coordinate the response to the epidemics, as a federal government should do.
- Enlarge the scope of the European Stability Mechanism to finance the immediate strengthening of the European and national health systems to cope with the pandemics, which threatens the lives of European citizens, and thus also the economic and financial stability of the EU.
- Abolish the compulsory balanced budget provision for the EU and create a EU Safe Asset to be issued to finance an EU-wide plan to promote EU economic recovery and social cohesion during and after the emergency.
- Move fiscal issues to the ordinary legislative procedure and provide the EU with fiscal powers to adopt new own resources – such as the carbon tax (and carbon tariffs), the digital tax, the financial transaction tax – to finance the EU budget (or the Euro-area Budgetary Instrument, if the decision could be reached only at the Euro-area level).
- Immediately approve the next Multiannual Financial Framework increasing the budget to at least 1,3% of the EU GDP, as requested by the European Parliament, on the basis of the current structure of the budget financing; and with the provision to reach 2% with the new own resources, to ensure the provision of crucial EU-wide public goods.
- Turn the planned Conference on the future of Europe into a fully-fledged European Convention to draft a new Constitutional Pact among the EU citizens and Member states.
We European citizens believe this is the defining hour for the EU. Social perception of the EU will be shaped for years by its response to this crisis. This is the time to prove the EU is a community of values with a shared destiny, a life-line for its citizens and member states in the face of a turbulent global world with political, economic and health threats. It is time for bold common steps to overcome fear. It is time for European unity, not for national division.
AN OPEN LETTER OF EUROPEAN ECONOMISTS TO THE PRESIDENTS OF THE EU INSTITUTIONS AND TO THE HEADS OF STATE AND GOVERNMENT OF THE MEMBER COUNTRIES
1 April 2020
The spreading of Covid-19 has determined the most serious global health and economic disruption hitting the whole world since World War II.
The health systems, families, individuals and firms across the whole of Europe need an urgent and significant help. The necessary measures include:
- Providing resources to the health systems to cure the infected patients and to prevent new infections.
- Providing temporary unemployment benefits to all workers who will be losing their job.
- Helping families and young, elderly and disabled individuals to satisfy the additional needs resulting from the crisis.
- Providing subsidies and financial assistance to firms that have to cease or reduce their production.
- Financing the education system to implement distance learning.
- Financing the operations of Non-governmental organisations in their role of social support.
- Financing a European-wide investment plan on infrastructures and environment capable of relaunching in a sustainable way the European economy.
The European Commission has provided 25 billion euros and has suspended the fiscal rules that the European Union countries are subject to. The European Central Bank has eventually provided a 750 billion euros temporary umbrella.
It could not be otherwise but, although we appreciate these efforts, we believe that they are not sufficient.
An extraordinary fiscal backstop of yet unquantifiable amount will be necessary, but countries cannot be left alone standing on their own fiscal feet.
If that were the case, national debt burdens would explode, no matter how comfortable today’s fiscal space may appear. Hence fiscal measures would lack credibility, thereby determining counterproductive market reactions that would increase risk premia, disrupt European financial markets, and – in the Eurozone – put an excessive burden on the European Central Bank: a remake of the 2010-2012 sovereign debt crises on an immeasurable scale. Even more importantly, any constraint on single countries’ ability to fight the pandemic and its economic consequence is a threat to people in all other countries. If this serious emergency is not correctly addressed, the health and lives of millions of citizens will be under existential threat.
We are facing a Union-wide unprecedented challenge, we need a Union-wide unprecedented strategy.
Therefore, we join to encourage the European Union to do “whatever it takes” to fight the pandemic, relieve citizens’ pains and support the economy across all countries taking an active role in financing, coordinating and implementing the necessary measures. As a result,
WE PROPOSE
that the resources that are necessary to respond to the emergencies that are hitting all European Union countries be collected in a common, centralized fund under the responsibility of the Union’s institutions (e.g. the Commission), avoiding an unsustainable increase in national debts. Any member country should have access to this fund based on documented needs and consistent plans agreed upon with the aforementioned institution; in case of difficulties in reaching a decision, the resources should be distributed to member states on population proportion.
As to the means needed to create the fund, several proposals are being put forward. In line with other appeals that we also subscribe to, we propose issuing Eurobonds, that we suggest calling “European Renaissance Bonds”. These bonds could be backed by some common fiscal capacity or other financial instruments created ad-hoc, considering that the fear of moral hazard cannot play any role under the present circumstances. Moreover, let us stress that this new common debt will not imply any mutualisation of existing sovereign debts but will refer only to the expenses that are needed to face the huge common shock hitting all EU countries. If a collective political determination and consensus emerges, no technical problem is unsurmountable.
After all, why was the European Union created? Why should we, European citizens, stay together if we are not even capable of providing a common response to the common menace that is threatening us? Without a common response the future of the Eurozone and European Union would be seriously at risk.
The EU should transform these difficult days into an opportunity. It is time to prove the true meaning of the long integration process that has created the European Union and the Eurozone institutions. Now a common action is needed urgently to prevent an irreversible damage.