EURO

The Euro is the most stringent European economic bond. The Eurozone traps 19 different economies within a rigid regime of fixed currency exchange rates, depriving them of monetary sovereignty and the tools needed to respond to economic crises and effectively combat unemployment and poverty. We can affirm that the EU monetary union is not stable today.

QUESTIONS

The member states are not allowed anymore to fluctuate the currencies exchange rate to intervene promptly against imbalances in the trade balance and the financial flows. This leads to a continued accumulation of trade and financial surpluses in the North of Europe and unsustainable deficits of public debts in the South. In the absence of rebalancing tools, the Euro forces the debtor countries to a regime of austerity. The consequence is a strong pressure on the labour market that leads to the internal devaluation of wages and salaries. These enormous imbalances have characterised the economic crisis in the Eurozone and created the excuse for imposing an austerity regime in the countries in deficit.
A single currency with a common monetary policy cannot work for heterogeneous economies that have very specific needs and very different economic conditions. The euro has an asymmetrical impact on the various Member States: it is a too strong currency for the weak Southern European countries, while is too weak for the strongest economies of Northern Europe. The North European countries have flourished thanks to an undervalued exchange rate, therefore eliminating the competitiveness of the southern European Member States and restraining their economic development.
In the Eurosystem, strong economies (Germany and Holland in the first place) continue to grow at the expense of the weaker economies (Greece, Italy, Spain, Portugal). The latter are used as markets for exporting goods on the one hand and on the other as the breeding ground for Banking speculation. With the single currency system, 19 Member States have lost the possibility of conducting an autonomous monetary policy tailored to their economies specific needs. Moreover, they cannot use the currency exchange rate as an instrument for economic policy, which is indispensable to support domestic demand in a period of economic crisis.
Today, the Euro is an instrument of political and economic governance that is defined as 'irrevocable' or irreversible by those who control it. It is the strongest constraint enshrined in the Treaties, used by the European Union to influence the fundamental economic choices of States. Along with other economic constraints, and in the absence of a proper solidarity mechanism, the Euro is creating a context of austerity and continuous political blackmailing that prevents the normal functioning of the democratic process in the Member States. The current European project has little to do with the prosperous and cooperative idea of Europe that was promised to the European citizens.
Denouncing the mechanisms that endanger the survival of the European project and trampling upon its founding values does not mean to be anti-Europeans. We want to be part of a democratic, stable and sustainable Europe.
The European Union has always refused to open a public debate on the costs of the imbalances, and the following macroeconomic adjustments, caused by the introduction of the single currency.
There is no such a concept as "irreversibility" in the EU treaties. As with all the international agreements, even the European Treaties and its provisions can be rolled back. The revision of the European Treaties and the withdrawal from the EU are provided by specific clauses contained in the Treaties themselves. However, there is a lack of political will in recognising this right.

OUR PROPOSAL

We believe that there are only two options available to get out of this crisis. Either creating some stabilising mechanisms between countries with the aim of containing the macroeconomic imbalances of the single currency, for example by sharing possible risks among all the member states, or the other option is the collapse of the monetary union. There is no prospect of prosperity and development within the Euro area without making the necessary reforms aimed to modify the institutional set-up of monetary union. These reforms have been invoked by experts and economists for a long time but have been continuously opposed by the wealthiest and most powerful states.

• We call for the creation of economic mechanisms of solidarity and compensation that can provide for net fiscal contributions from wealthy countries (which have unfairly accumulated enormous surpluses) to those countries affected by years of austerity and unemployment. Such transfers of resources should be used to finance productive investment and support policies aimed to a rise of the employment. It is indispensable to contain macroeconomic imbalances within the Eurozone, to reduce the divergence between countries and to ease the asymmetric impact of the single currency on the weaker economies.

• We call for the setting in place of the necessary tools that will facilitate the risk-sharing between the member states. These tools can take the form of a true public debt sharing, or in giving the ability to the ECB to buy government bonds directly from individual countries in difficulty to avoid the unsustainability of public debts or excessive financing costs, or the creation of a guarantee single European bank deposit scheme, or a common unemployment insurance.

• We are strongly opposing the financial mechanisms based on the blackmail and bullying of the strongest countries towards the weakest countries. These financials aid that should support those countries crushed by the unsustainability of the euro are becoming instead rigid and unbearable macroeconomic conditionalities based on conflicts of interest with the private capital.