In a speech made to the Association Européenne de Droit Bancaire et Financier Luxembourg on 5th May, Yves Mersch, a Member of the Executive Board of the European Central Bank, called for a deeper political union within the European Union. The address was timed to coincide with Europe Day”, which takes place on 9th May and commemorates the Schuman declaration of 1950.
Mersch chose to quote Schuman for the 21st-century audience, recalling the rationale for the setup of the European Coal and Steel Community:
“In this way, there will be realised simply and speedily that fusion of interest which is indispensable to the establishment of a common economic system; it may be the leaven from which may grow a wider and deeper community between countries long opposed to one another by sanguinary divisions.”
Coming at a time when political parties across Europe are positioning themselves ahead of the 22nd May European Parliament Elections, these comments seek to underline the need for closer political union, something which may not be popular among leaders seeking to head-off threats from right-wing parties.
However, Mersch stayed with the argument of supporting an economic union with political community, for the sake of European stability:
“Going beyond the establishment of a common economic system, the EU project was from the beginning aiming at creating a deeper community of Member States. Recent progress in the financial and economic field should not make us forget that citizens also expect Europe to deliver on broader public goods such as internal and external security. The Single Market and the EU’s “four freedoms” (i.e. free movement of goods, capital, services and people) have brought new challenges for law enforcement authorities. Moreover, the fragility of external security, especially at the borders of the EU, remind us that, as put forward by Schuman in 1950, “world peace cannot be safeguarded without the making of creative efforts proportionate to the dangers which threaten it”. It requires going beyond the economic foundations of the European project.”
As Europe day and the European Elections draw closer, it remains to be seen whether economists can convince politicians of the benefits to working more closely together within the European Union.