18 April 2012

ECON Committee: From austerity to growth - MEPs debate about the way out of the economic crisis

Commission initiatives

Commission president, José Manuel Barroso, introduced two Commission initiatives, urging "the Member States to move forward quickly and take the necessary steps". The first one - the Employment Package - sets out to encourage SMEs, maximise jobs across Europe, give policy guidance on job creation and support health care and the green economy. The second initiative aimed at supporting Greece will introduce a set of priority actions from youth employment to tax reform in order to unlock growth and create jobs. Mr Barroso warned: "We have to make every effort to implement the map we adopted in October. The Commission will not hesitate to force the Member States to do so."

Need for a new approach

French Christian-Democrat, Joseph Daul, said the EU had done a good job in stabilising the economy since the outbreak of the financial crisis: "We equipped ourselves with reinforced discipline mechanisms, which were necessary to become credible again." He emphasised the need for a "new growth logic" with a strong focus on SMEs. "We need to help them; we need to support them so that the banks can finance them." Mr Daul said red tape needed to be cut as it costs the European economy €40 billion a year.

Austrian Social-Democrat, Hannes Swoboda, commented: "We see too much austerity and too little security". He insisted on the need to cater for growth and not just austerity, asking for the Employment Package to be given the force of law because "we are still doing too little about unemployment" and too many unemployed young are becoming alienated and losing faith. Thus, "to avoid the iceberg, the employment package must be turned into law, declarations are not enough".

Belgian Liberal-Democrat, Guy Verhofstadt, said that despite the introduction of austerity measures, the massive buying of sovereign debt and the biggest haircut ever: "We all know the crisis is not over". He said the crisis would only be resolved through a two-pronged structural approach, including the full-scale launch of project bonds and the mutualisation of debt, which would shift the burden from taxpayers to bond holders. He also criticised the payment of election funds to the two main Greek political parties.

The role of the ECB

German Green, Rebecca Harms, was disappointed that Mario Draghi, the president of the European Central Bank, was absent, since she would have liked to quiz him on the Bank's "counter-productive" strategy over the past two years. She said that although billions of euros had been spent on saving European banks, it did not seem to have much affected the real economy. She concluded that the ECB had "not spent the money properly".

Decision time

British Conservative, Martin Callanan, said it was time for euro leaders to make a decision: "The eurozone faces the same problems it faced beforehand." He added: "Greece should be allowed to leave the eurozone. A ten-year-old child can work that out. Actually a ten-year-old child did work that out."

Nigel Farage, of the United Kingdom Independence Party, was very bleak about the outlook. "The euro is doomed", he said. He also told Barroso: "No-one believes you when you say that if we stick together we will solve this crisis", adding that he hoped the IMF will stop putting money into the EU.

Gabriele Zimmer, a German member of the Confederal Group of the European United Left - Nordic Green Left, said the markets are being helped, but not the people: "It was wrong to only consolidate the economy and ignore the lives of ordinary people. It should be the other way round." She told Barroso: "You should send people to Greece and Portugal to see what is happening".

Press release

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