06 December 2011

Heinrich Winkler: The fall of the Berlin Wall to a US of Europe

In his FT article, Winkler writes that as Chancellor Angela Merkel adjusts her course on the eurozone's debt crisis, she knows that years of hard-won achievement hang in the balance.

Currency union has been the ambition of many a postwar west European politician, including Helmut Kohl, who wanted monetary union, but with political integration. In the spring of 1990 he gave in to Mr Mitterrand, to prevent tainting German unification with Franco-German discord and agreed to a separation of the issues. The result was the 1993 Maastricht treaty. Monetary union became a reality, but not the fiscal union which was at the heart of Germany’s vision for political union. The result fell far short of the German vision.

Neither the euro nor the European Union would survive for long, should Germany give up long-term fiscal responsibility in favour of political opportunism. So, there must be a catch-up for what was unattainable in the 1990s – the EU’s evolution into a political union.

Integration, which is so essential, means changes to the European treaties, and these take time. In the meantime, inter-governmental cooperation between states will intensify leading to parallel structures of the EU and the euro states that will cause frictions and cannot last forever. A federalist Poland would be the ideal mediator between a closer monetary union and the EU.

Poland joining the monetary union could have a magnetic effect – and will if currency union has become a “stability union” by then. EU states meeting the conditions for the introduction of the euro will presumably review their attitude to currency union. Their coming decisions will be far-reaching: they cast their shadows before them – in Stockholm, Copenhagen and London.

Many commentators say that Friday’s summit is the very last chance for the eurozone leaders to resolve the crisis, and even save the currency union. But what the euro and the EU need, is neither activism nor fatalism. They need a well-considered concept for the future – a concept that can restore the credibility of the European project.

The Franco-German proposal to transform the EU or at least the eurozone into a fiscal union is such a project. The fiscal union is not only the way to overcome the most serious crisis of the integration process. It is also the precondition for what the EU should strive to become: political union, a federation or, to use an even more ambitious term, the United States of Europe.

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