Welcome, everyone. Welcome, Chancellor.
Welcome, Minister. Welcome. Honoured guests. It is a great pleasure to have you all here at St Antony's.
And I will send an apology to the people standing outside in the rain. But you have, I'm afraid Minister attracted a crowd worthy of a rock concert.
So thank you so much for coming to talk to us. And we're very pleased to welcome you here.
I'm the warden of St Anthony's College, which is the most international college at Oxford University.
Our students and our fellows come from, I think, 78 different countries.
And we have strong links with many parts of the world, including, of course, Germany.
This college has always had a very strong relationship with Germany and has welcomed German scholars here over the years.
And many of our students have come from Germany and have gone back to become leading figures in German universities.
The German media. German business. And German politics.
Just last year, we were very pleased to make Dr. Johann Kaka, an honorary fellow of this college,
strengthening again the links with Germany, of which we are very proud.
It's a great pleasure to have you here today.
And I'm going to ask Dr. Aslan, Ernest Hatzakis, who is the director of the European Studies Centre, to introduce our Chancellor.
Thank you, Margaret. My name is often Mr. Serkis,
and I'm the director of the European Studies Centre and on behalf of my colleagues governing body fellows of the European Studies Centre.
I would like to welcome you to the 2012 2013 ESI Annual Lecture.
The annual lecture is the most prestigious our annual event, and we invite eminent personalities from the academic or the policymaking community.
In the past, we have hosted the Prime Ministers of Britain, Spain, Turkey,
as well as foreign ministers from Germany, Greece and EU senior figures to deliver our keynote lecture this year.
We are very privileged to host as our speaker, Dr. Wolfgang Schauble, the German federal minister of Finance, to deliver his talk on Europe.
Still a common vision. Dr. Sobel is a well-known political personality all across the globe.
One of the most prominent politicians in Europe and committed Europeans, and one of the key actors in the current period of the Eurozone crisis.
This is the second time, I believe, as a speaker with our centre.
The previous time as leader of the German Christian Democrats,
he delivered one of the annual Konrad Adenauer lectures on why the nation is safe in Europe.
Just a few words, if I may, regarding the European Studies Centre, which was established in 1976.
Since then it is dedicated to the interdisciplinary study of Europe, its regions and countries.
It is particular strength in politics, history, international relations,
political economy in the field of social sciences and in cooperation with the field of humanities.
The study of Germany has been one of our core subjects and our centre has kept close links with German academic institutions,
thinktanks and foundations. As part of Saint Anthony College, we follow the tradition of keeping close links with academia in the policy world,
which we do in the context of research projects, seminar series, research, regional programs,
and lectures on different matters that deal with Europe's internal developments and Europe's role in the world.
This term, for example, our core seminar series is dedicated to the European crisis,
which we organised in the form of debates every Tuesday at 5 p.m.,
where we discuss the impact of the current crisis in the eurozone from a political, economic, social or political cultural perspectives.
Today, we are also very fortunate to have with us the Chancellor of the University of Oxford, Chris Patten,
the patron of the European Studies Centre, who, as we all know, is somebody who cares deeply about Europe, its present and its future.
We are very privileged that our Chancellor, at least once a year,
agrees to chair one of our major events and interact with our keynote speakers and our audiences.
This year he has very warmly agreed to chair this event and to coordinate our question and answer session.
Before I ask the Chancellor to present the Speaker for tonight,
I would like to thank all those who are involved in the organisation of this very prestigious event,
and especially Dr. Dorian Singh, who has been the real engine of this year's annual lecture.
Dear colleagues and friends, I hope you will enjoy our annual lecture tonight.
Our Speaker has agreed to talk for approximately 30 minutes.
Then we can open the lecture to questions and answers. The lecture will be video recorded and posted on the web,
but not the question and answer session, which will only a tape recorded and not video any more.
Thank you very much. I do not intend to reintroduce our speaker because he will certainly know who he is, and if he didn't already, he will know.
I would just like to say what a privilege and honour it is for us to welcome you, Minister,
to Oxford and to the European Studies Centre at Sundance is St Anthony's is of course, as the warden pointed out, a an academy of serious study.
But even Sundance News will have been surprised to discover the future of the Eurozone is more popular as a subject than a a gig by Bruce Springsteen.
So the importance of what we know you have to say and your own intellectual distinction have ensured that this is a packed house.
And everyone here knows that.
You, Minister, have been at the centre of some of the most important debates, some of the most important history made in Europe in the last few years.
At the heart of an important debate about the relationship between the defence of civil liberties and the
defence of pluralist democracies against violent assault at the centre of the reunification of Germany,
which is one of the certainly most important events in my lifetime,
an event that carried through peacefully and with the establishment of a solid democracy.
And today, you're at the very heart of the discussions about how the Eurozone may be saved.
And I noticed you said in a speech last week that the game is far from over.
And because of the central importance of that issue,
you are also at the heart of the debate about what the European Union will look like and will be in the future.
What is the narrative of the European Union and how it develops in the 21st century relates to our democratic institutions and in Europe.
So we are really honoured, as I said, to have you with us today,
and I'd like to invite you to speak to us and then deal magnificently with the hope to achieve this objective.
Thank you very much. Thank you very much, Tamara.
Ladies and gentlemen, it gives me great pleasure to speak to you today about Europe, maybe to a very few people who could not join this room.
Well, listen to first few words and then I will be happy to have talked a little bit of that.
But having said this, I would say it's a sign of hope for me that so many young people are so interested in European matters,
even in endless and I take it as a sign of hope.
But by the way, few other places would seem as appropriate for a lecture on Europe as Britain's foremost place of learning.
Was it not so Winston Churchill, who first sketched the concept of a united Europe?
And where else in the EU today does its uptake of Europe rise as much business as in the UK?
Where else does it occupy a similarly privileged place across the national media?
There was a time, I was told, when the owner of a celebrated hotel advised his staff not to mention the war to their German guests.
Today, Basil Fawlty might well instruct them.
Instead, don't mention the euro. Over the centuries, the bonds between European nations have not always been equally strong.
Our relationships have sometimes been warm, sometimes less so.
And the 20th century certainly was no exception in this regard.
But the sense of community between the peoples of Europe always prevailed.
During the continent's tumultuous history. Britain and Oxford in particular, often became safe havens for continental refugees.
Periods of crisis on the European continent have often made your country more European.
Long lost, perhaps never as. As during the years following the French Revolution and British resilience in the
face of totalitarian evil throughout the 20th centuries and its willingness to
permit the immigration of thousands of refugees from the continent made Oxford in
the mid-20th century a more European place than it ever been before in Oxford.
We cannot fail to perceive that our past is European.
The question before us is what does this mean for our future?
I do not mean to be overly dramatic. We do not face a return to the hostilities that have plagued our nations for centuries.
The media like to describe today's political disagreements between European countries in stark language.
In my view, the debates we have seen over the last two years demonstrate,
if anything, the substance of European integration is reached over the years.
We disagree. We argue. We criticise.
But this is how politics works. Within all democracies,
we have learned to accept the society's willingness to allow the public consultation over divergent issues is a sign of its health.
In the present crisis, we deal with serious issues and with conflicting interests.
We cannot be surprised that oppositions are clearly articulated.
What is remarkable is that confrontational and aggressive nationalism is almost entirely limited to very small fringes of European societies.
But if it. But if it is the case that Europe is not confronted with a potential return to a political stage between its nations,
it's nevertheless true that we face fundamental and difficult decisions.
These decisions do not only concern the details of the EU budget or the European Stability Mechanism,
important as those are, they are not even just limited to the issue of the common currency.
At the most fundamental level. Europe today needs to regain its compass.
It must be clear about its future direction of travel.
My impression is that over the last few years, partly as a result of the financial crisis,
differences have emerged over our very idea for the future of European integration.
My view is that agreement on this idea matters.
Once we know where we want to go, we can productively and fruitfully disagree on many points of detail.
But if we cannot find common ground on the broad base and be here for the European project,
it will be increasingly difficult to come to terms with the practical problems we face on an everyday level.
When European integration began, after the horrors of World War Two,
its political founders were clear that the project was more than the creation of a free trade zone.
So we are determined to lay the foundation of an ever closer union amongst the peoples of Europe.
As the Treaty of Rome famously put it, what has today become of this process was.
I see two very different answers.
The first of them looks back to the 60 years of post-war European integration as a story of principle, success and progress.
It highlights how, throughout the different phases of the EU's history, many areas of economic, political and social life converts.
People today travel across much of continental Europe without border controls to pay.
They pay in many of these countries with the same currency.
The goods they buy are regulated by competition and environmental laws, many of which apply across the 27 member states of the EU.
The award of the Nobel Peace Prize of the EU six recognises the Union's remarkable
achievement in giving our once thought on continent into longest area of peace,
time and co-operation in its turbulent history and making Europe a major world player in its own right.
From this point of view, the idea of an ever closer union between European peoples has been the model correctly describing
the direction of travel to countries of Europe have taken over the last couple of decades.
In fact, it continues to describe that direction in so far as the Union of the Peoples of Europe remains an unfinished project.
What it was a precise description of its goal. The European Union still moves towards an ever closer union of its member states.
Those like myself who share this perception of the European project are by no means blind to the many weaknesses.
So takes note, it progresses. We acknowledge that legal standards of citizens across nations have at times been created
by a bureaucracy that often seems remote and detached from the concerns of the people.
Even tough, tough Eurocrats have also become the convenient scapegoat for national politicians
who often bear much of the responsibility for suboptimal decision making.
We recognise that the need to find a compromise solution palatable to all Member States
has often turn current political ambitions into petty negotiations about bargains,
subsidies or rebates benefiting individual countries.
We are well aware of the fact that the European project is still and perhaps increasingly detached from the reality of most European citizens.
We have no European public to speak in spite of political institutions that represent Europe's citizens interest in the bargain.
Even basic familiarity with their functioning is not widespread within the EU.
Last but certainly not least, we are faced with a serious monetary crisis which,
if it cannot be contained, threatens to undermine the very idea of European integration.
All these difficulties, however, do not mitigate against the general validity of European integration.
Politics, as Bismarck famously remarked, is the art of the possible.
The politicians will always face difficulties in.
The project he seeks to accomplish.
He has to accept that what we can achieve will never, ever even come close to what he ideally would have hoped to achieve.
This is political reality. Whether we look at the governance of small regions, of nation states or at the European level.
This, in very broad strokes, is one vision of Europe. I believe it's still valid.
And in fact, politically, the most helpful, the most forward looking, the most promising vision we have.
I speak here today to defend this vision and to argue that recent events are misconstrued if taken,
to demand the abolition of the goal of European integration.
However, I am fully aware that for some this has ceased to be a realistic objective, at least in the short term.
In recent years, there has been across Europe a growing chorus of sceptics who for very different reasons, have lost faith in the European project.
They will look back to the early years after the war, but their story is a very different one.
According to this account, European integration was a good idea as long as it was clearly limited to goals that could realistically be achieved.
Creating a single market. For example, opening Europe to the free movement of goods and of people, thus creating a highly competitive free trade zone.
By leaving sovereignty unambiguously with national parliaments and governments.
The project was derailed according to this reading of our history,
when European politicians ceased to distinguish the politically desirable from the medically feasible.
The massive complications inevitably arising from the attempted economic and political
integration of a growing number of increasingly diverse nation states were ignored.
So this theory by those blinded by the grand design of a future, a united Europe.
But has history not taught us that such a design is unlikely to work if there are not been successive historical
attempts to overcome the territorial and political diversity of Europe in the interest of its global competitiveness?
And have they not all failed the test of practicability?
I'm Charles magnitude Napoleon. That project ended in failure because the peoples of Europe Java's independence
and refused to exchange it for the promised blessings of a European state.
It's no coincidence that advocates of this view cite the introduction of the euro as major evidence supporting the theory.
After all, the financial crisis has sown doubt about the merits of the European project within the EU and beyond,
and nobody can or would deny that this crisis has exposed the fundamental flaw within the original design of the currency union.
We introduced a common currency within a community of nation states that still retain their full but to their sovereignty.
We had a common currency, but no fiscal union, no supranational control over national budgets, and no European regulation of banks.
No wonder a serious financial crisis stretched systems to breaking point.
The critics are right, in my view, to warn that European integration can very easily turn from a pragmatic political venture
into an ideological project that is pursued without proper regard for its chance of success.
They are also justified in their worries that decisions taken far away from those who are most affected by them easily become abstract and effective.
Ineffective. A fundamental principle of Germany's political and legal system is the principle of subsidiarity.
It demands that decisions must always be taken at the lowest possible level.
Don't let the central government decide what can reasonably be decided by local communities or at the regional level.
From our point of view, Europe should stick to the subsidiarity principle.
Its responsibilities should be restricted to those that cannot sensibly be fulfilled at the national or regional or the local level.
Vigilance is needed here. But the same is true within many existing, existing nation states.
A tendency needlessly to centralise power is certainly not a special problem of the EU.
I strongly disagree, however, with the claim that any of these shortcomings necessitates a fundamental revision of the aims of the.
European integration. On the contrary, we need integration.
In fact, I think we need more integration in order in order to overcome existing problems.
The difficulties a single currency has faced during the financial crisis have not
invalidated the reasons it originally justified its introduction in many ways.
So your has been remarkably successful, given how many of its areas were prematurely put in for it.
It continues to exist. Its exchange rate against the dollar, the pound and other major currencies is stable.
Inflation in the eurozone has been low throughout the currency's existence,
supposedly lower compared to the inflation rate in terms of deutschmark in Germany.
Nor has the currency union lost any of its members.
If I am not mistaken,
the voices of those predicting this imminent exit of one or more countries from Southern Europe have recently become much quieter.
By the way, the last poll in Germany shows a majority in favour of not leaving Greece, at least not leaving the eurozone.
That is new and in German both. But it has been the fact in the last week.
Indeed, the crisis has forced the countries that make up the eurozone to confront the initial shortcomings of the currency union.
And we are in the middle of a successful effort to improve them.
We have introduced bailout mechanisms. We have created the ESM.
We are moving towards a closer coordination of fiscal policies across the Eurozone.
We are on the way to create a stability union for public finances.
The Stability and Growth Pact has been strengthened. We introduced the balanced budget rule and the preventive arm.
There is now a much larger focus on debt reduction for members of the eurozone that do not comply.
A sanction mechanism is in place and we made these instruments more credible by
introducing high hurdles for the Council to block a proposal from the Commission.
Not long ago, much of this would have been unthinkable.
Far from undoing the European project, the crisis is helping to advance it.
Admittedly, sunglasses is not over and no one knows what challenges might lie ahead.
But I would predict that when Europe emerges from the crisis, it will emerge stronger and more unified than before.
It will not only have retained its common currency, but will have improved existing mechanisms to protect it and make it work.
Why is this happening? I think the fundamental answer is that Europeans are working to protect the cargo state of European integration,
including the common currency, because they recognise that it is both them and continues to bring them enormous benefits.
Lincoln famously, famously said that you can fool all the people some of the time and some of the people all the time.
But you cannot fool all the people all the time. Even at the height of the crisis.
Support for the Europeans economy was still at 80%.
To say, I am convinced, is fundamentally the case across the eurozone and there is a reason for this.
Businesses in the Eurozone countries enjoy a huge market with 330 million consumers in 17 countries.
40% of German exports, for example, go to the Eurozone.
But perhaps more importantly, of exports, it leaves the currency area.
60% are denominated in euros.
This is the advantage of operating with the major currency, and especially small and medium sized companies are perfectly aware of it.
So also there are also indications that the common currency is good for growth.
A McKinsey study earlier this year found that being a member of the eurozone increased the
Finnish GDP by 6.7% in 20 2020 to the German GDP by 6.6 and the Austrian GDP by 7.8%.
Contrary to what its opponents claim, the major steps of European unification,
including the introduction of the EU, are not driven by wishful thinking or by ideology.
Process be as a result of pragmatic considerations of negotiations and of
compromises between governments acting in the best interests of their people.
One can always, with the benefit of hindsight, speculate whether one or the other decision was perfect or should have been taken differently.
Once again, I cannot see how European politics is different in this regard from any other area of political decision making.
Most European countries agree that European integration is their best chance
to compete economically and politically in an increasingly globalised world.
Another popular concern is the alleged goal of a European superstate.
Let me posit you, however, said on this account, a difference of principle does not exist.
It is true that people have occasionally used the phrase of the United States of Europe in an affirmative sensible since NAFTA.
I never adopted it myself, but formulations about the establishment of a European state is a policy goal nobody serious seriously envisages.
It has always been the principle of European integration, since the sovereignty of the nation state remains fundamental.
Given how deeply entrenched this pretty principle is in many constitutional and political traditions all over Europe,
I cannot see how anyone would in earnest plan to move beyond it.
All European agreements are technically pacts between sovereign nation states that are and remains the ultimate political subjects.
What is the origin of this subject of suspicion?
I believe it's due to the singular character of the EU as an institution.
It's neither a mere alliance of nations for a nisra nor a federal state.
Member States have ceded sovereignty to it. And I might add, this has been necessary and more may be necessary to understand.
The EU needs to think he mentioned imaginatively and accept that it is a sui generis entity trying to classify eternity into categories like federal,
state. The common market between individuals and nation states is not helpful.
Historically,
national sovereignty has been a cherished principle of European statehood is not sends a demand to cede sovereignty to a supranational body,
ultimately tantamount to the creation of a European nation state.
Calling crowds who for many years thought as while the university has succinctly, succinctly explained the situation,
he argues that there is no contradiction between the essence of identity and European integration.
The alternative to Europe, to European integration, he writes, is not a return to national sovereignty, but a submission to global economics.
Economies dominated, dominated by the networks of other states over which Europe has no influence in other worlds.
And I could not agree more with growth,
which clouds those who oppose European interest of their national independence will find that other forces in our globalised market economy,
which are formal, dictatorial because they know of no voting mechanisms that allow vetoes,
its effort to cite growth to gain Europe, it ultimately secures our national autonomy.
While it agrees that much of the opposition of Europe's political integration is based on misconceptions.
I would like to reiterate that a certain amount of scepticism towards European institutions is perfectly justified.
A tendency to centralise power exists, and it operates without proper control.
It's dangerous. Ceding power to Brussels is not ad hoc.
Olympics scenario. Some opponents of European integration perceived, but neither it is a means that in itself moves the European project forward.
It must be linked to real reform of European institutions so as to guarantee that
powers are exercised judiciously and in accordance with democratic principles.
This would suit, in my view, includes the introduction of more democratic participation of the electorate across Europe.
If there is more power, there must be more accountability.
One important element of such democratisation of Europe could be the election by popular vote of the President of the European Commission.
It would give a face to the political unification of Europe, and I would allow the successful candidate to build real power.
I am aware, of course, that this is not going to happen tomorrow.
More immediate plans, however. Concerned Party European list for election to the European Parliament.
Plans for this have been drawn up. There'll be some that can be introduced in time for the next election in 2014.
Perhaps you will allow me to add at this point a few words about the UK as part of the European Union.
I'm fully aware that Britain, more than other European countries,
is currently going through a process of reflection about its relationship with its European partners.
I understand respect that this is a discussion that must primarily take place in Britain.
However, the United Kingdom has also been part of the European Community since 1973.
Most major European developments since then have benefited from its British participation,
meaning leading figures in European institutions have been bridges.
Someone is sitting close to me. So we, fellow Europeans, have our own vested interest in the future of the UK and the EU.
Let me say first of all, that I understand the changes in the British situation within the EU have partly happened simply
because of the increased importance the group of €17 members has taken on in the course of the crisis,
as the EU members outside the common currency have experienced a similar development.
But undesired mistaken the sceptical voices have been become particularly strong here.
Fundamental doubts about the wisdom of European integration and especially the common currency, appeared to dominate the national debate.
The option of a referendum about Britain's future in Europe does no longer seem far fetched and whatever else results may affect of such a referendum.
Even the fact that it is seriously considered is indicative of a growing tide of Euroscepticism.
I would like to make three brief comments about Britain and Europe.
My first is that Europe needs the United Kingdom.
So there are various reasons why it is the case.
Britain is one of Europe's strongest, most innovative economies.
London is the financial capital of Europe. So Britain, Europe is connected with the English speaking world.
I could easily extensive list that would prefer to make a somewhat different point.
I have been speaking here today about visions for Europe. Europe needs a vision if it is going to have a future, we need fundamental agreement.
But it's also important to have an ongoing and political debates about about the best way forward.
It's only such a competition of ideas that secure our success.
In my view, the British voice is sorely needed in this competition of ideas.
It may seem facile today to bring up this country's long and successful story of democracy in Parliament that isn't doing.
Not other countries, but I know have long established democratic cultures to do,
but within European approaches to political as well as economic ideas.
Britain still often represents its own special way.
I firmly believe Europe would be poor without this input in to our debates.
Britain should retain and regain a place at the centre of Europe because this will be good for the European Union.
My second commend is that Europe is also good for Britain. The nation is still safe in the EU.
I fear this is not always fully recognised. Recognised. Some in the British media prefer to think of Europe as a major burden.
Perhaps it's something our two countries have in common. However, in one side of a complex truth and arguably less than that.
About two months ago, the Polish Foreign Minister, Sikorski, gave the Blenheim Palace speech only a few miles from here.
In his speech, he enumerated no fewer than eight British myths about the European Union.
They ranged from the misleading claims that British trade with other parts of the world is more important than its European trade.
Too often cited prejudices about European institutions and the impact on Britain.
And to the rather specific complaint that allegedly new proposals for EU pesticides
legislation would ban gardeners from using coffee grounds to tackle snacks.
The letter is a good example for the surprising willingness of parts of the media in
Britain and elsewhere to invent incriminating claims against the European Union.
But it also shows that a large proportion of the population are ready to believe such claims, regardless of their factual basis.
More important things out Miss is, however, the cross key points out.
Points out as if. Hard facts that make EU members attractive for the UK like holding out.
She argues that the freedom gained by leaving is wiped out by the resulting loss of influence on the global level.
Ultimately, the EU is beneficial to the UK both economically and politically.
In my said commons, therefore I said we should try to work this out together.
The British people will have to come to a considered view about its future in Europe.
I am convinced that when all is said and done they will come to the pragmatic conclusion.
Then it is in their own best interest to stay in, be part of and influence the European project.
After all, this is why the United Kingdom decided to join in 1973.
Let's be optimistic and observe. The 40th anniversary of this momentous decision in the more recent history of your country will
coincide with a renewed commitment to the ideals of an ever closer union of the European peoples.
Equally important, however, is that everybody in Europe needs to keep thinking about the future shape of our economic and political union.
The noise created by the currency crisis has distracted us from this task, but it has also made it clear how urgent that the occasion is.
Isotopes that when we sit down for a full discussion of our visions for Europe's future, Britain will play a vital part in those debates.
Germany, at any rate, is fully committed to a common future in Europe and will do all it takes to make it a success.
One of the great institutions of British culture is obituary in today the UK has become
the leading market for updates on the euro and on European integration more generally.
Reading a certain pink paper, I note that even Germans, always eager to export, has started catering to the business.
Let me end this lecture by saying to all involved, I am convinced this is not a sustainable business model.
Thank you very much. Thank you very much indeed, Minister, for that extremely interesting and entertaining speech you mentioned, which was, I think,
quite flattering to this country that you thought we were at present going through a period of reflection about your relationship with him.
I wonder if I could just exercise my divided chancellor by posing a couple of questions
at the outset and then opening the discussion to the to the lecture theatre.
And the first question which we reflect on is this When the euro was being sold to the German electorate,
one of the arguments for it was that it would promote greater convergence between Europe's economies.
And we know what happened. Far from greater convergence, there was greater divergence with, I think, in the first ten,
ten years or so of the euro and the prices of domestically produced goods in Germany going up 9% in Greece, 67% in Spain and Portugal, over 50%.
In Italy, over 40%. And now presumably the objective is to promote that convergence, which we didn't see before as rapidly as possible.
And while not assuming that the markets will only be satisfied when there is perfect convergence,
plainly there is somewhere between where we are now and where we would like to be for a full convergence which will satisfy the markets,
but in some way off. And in the interim,
German taxpayers and Dutch and Finns and others are presumably going to have to bail out the weaker economies for the lack of convergence.
How long do you think that can last and how long do you think governments in the weaker
economies can persuade their electorates to go on with their policies of austerity,
which are already creating in some countries, increasing extremism in politics?
You are? You are right in mentioning. Of course I agreed.
That when we created the other one, we'd tried to convince what was not an easy task,
intoned his cousin, as you may remind that it would be the right decision.
One argument was increasing greater convergence, and I think this was the very reason of a lot of political leaders in other member states as well.
And by the way, one of the in my understanding, one of the major reasons of the crisis is that they forgot that they have a common currency,
increases the pressure on productivity and competitiveness.
They have, of course, if it would work, it would enhance the greater contrast.
But it doesn't work because they figured they enjoyed low interest rates and they want that to to increase and to work on competitors.
Therefore, any program which we agreed for Member States with to assistance by the European Facility of Financing Facility
Mechanism that you have therefore now is m and not only to adopt measures for correcting the fiscal policy,
but also for have to go for structural reforms to enhance competitiveness productivity.
That is because without this it will not work.
By the way, if the best example of a common currency make pressure on on competitiveness is the history of the German reunification.
If you if you remember that the of the former GDR was in early statistics so far my my respect
for statistics and economists was number 11 in the world after the fall of the Berlin Wall.
Number 11 better when reintroduced on behalf of the strong desire of the population in the GDR, the Dutch,
the Deutschmark and the currency from the Federal Republic in the GDR on the 1st of July,
all industrial production of GDR was not competitive, was over to the end as well.
And this totally has not been taken by by a lot of our member states.
So therefore we have to work on this.
It's true. You see, I am answering your question.
How long you'll be able to stay in convincing the German public that it we have to pay?
My argument for German public is the most advantage is for Germany because it's a competitive relative competitive.
Member states enjoy a common currency as I have.
Therefore, it's in the very best interests of Germany.
To defend the common government is a good argument and we are not without any success in the non European members in the non successful member states.
It's a little bit different. I think some member states have really understood, I think the actual the Monti government of Italy is really understood,
as everybody knows very well better than most people in Europe what is needed for a competitive economy.
And is a chance to fight for Italy, too, to increase its position in productivity and competitiveness.
The new Spanish government does. The Irish government, Ireland does.
Portugal. The New Spain is. The new Prodigy's government is telling the public.
The Prime Minister has said publicly he would not be interested in lower interest because as soon as interest rates in Portugal go down,
they will not achieve decisions on reforms like the reforms they need to do in principle.
If you look at the debt, my argument was public opinion and now you can judge yourself how long it will be.
I have to answer your question.
But if you look at the developments in the globalised world, and sometimes even for Europeans, it's very helpful to look on the world outside.
You see how how fast, how fast there are changes and how strong the pressure on competitiveness is ongoing.
Ongoing.
If we will not deliver in the what is needed in Europe, we will fail in the in the global market even even sooner, even faster than in Europe.
Therefore, I have to tell this to surveillance in member states which suffer a lot of problems that they need needed in their very own interests.
And of course, we have to help them to overcome.
How long will it work? I will not give an answer in the concrete figure of of years.
It would not be a good idea for a finance minister.
But as long as we can tell them we are making progress, I think we we have a good chance that to to to be successful.
If you look at even the outcome of elections, look at the last elections in an autonomous region like Galicia in Spain.
A good outcome, totally.
In contrast to the to the to the pictures we got in TV from demonstrations in
Spain to the regional election in both was of support for the Rajoy government.
I am quite optimistic what's going on in Italy. If you look at Greece, it's quite interesting.
I think it was in my opinion, it was a very critical decision to go for new elections in March after the election in March.
They were not able to build a government which could stick to to even to negotiations, to what is needed for a new program for Greece.
Then they had to go for another two new elections.
It was a a source of future contagion for other EU member states, by the way, part of the second new elections in June.
So they got a good government which was able to and it's it's more engaged and more reliable.
What does it mean? And more open than any government before.
In the last year for if it's not I think publications to understand it's critical but it may be like of course we have to come to come
forward step by step and we have to use the momentum of the crisis because we will get substantial changes in Europe which we only get.
And that is not new and European is the only in times of crisis and therefore there is a chance to get advantage.
But up to now we can manage it. Even look at look at the result of the last election, the Netherlands.
Otherwise, you have a lot of both incentives.
Just may I ask you one other shorter question,
which is part of the British reflection and those of us who are regarded by the
right wing populist press as being complete euro fanatics do worry about one issue,
which is this plainly, it is hugely in this country's interest that the eurozone crisis is satisfactorily resolved.
It would make a lot of difference to our own economic prospects.
We worry that the only way that that crisis can be resolved through the establishment of a fiscal union.
Would involve changes in the European Union, which would be extremely difficult for this country to accept,
for example, ceding power over the budget in some of its particulars to Brussels or to an official in Brussels.
Difficult to imagine the assembly, as you know,
and taking kindly to being told what to do with their budget or their taxes by a Finnish commission that I suppose stranger things have happened.
But in this country it will go right to the heart of our national narrative about
the relationship between democracy and voting supply and determining tax and spend.
So the worry that we have is that resolving the euro crisis satisfactorily creates a European Union,
which we would have a lot of difficulty persuading our democracy to be part of.
Do you have any words that will comforters on that particular point as may be?
It's a problem. But in the last couple of years in this crisis, during the crisis,
we have carefully had in mind that we want to not want to widen the gap between the 72 members of
the government indefinitely as a monetary union and as a ten member states of the European Union.
When we when we decided to give some examples, when we decided in early 2010 to go for a fund run by a task force,
what was, by the way, under the presidency was a fun,
fun, fun run by the finance ministers of the member states to make proposals for what can be used to strengthen the it was a noble task was worth 27.
The European finance ministers of the Czech Republic was represented not by the fact it was about 27 European ministers,
not only 17th we had and the British finance minister to take part in all discussions.
We did not say we want to do it to when we made the fiscal compact.
Which, by the way, we would have preferred to have as an amendment of civility,
a limited amendment not needed for a convention the European countries would have not.
That has been already discussed with Parliament and Commission and even the French president,
who was not in favour from the very beginning of a new of a new amendment of the treaty,
because he had taken a major risk,
Nicolas Sarkozy had taken a major risk in campaigning for the presidency when he said he will not go for another referendum.
And both opponents have said, yes,
we will go for another vote and we wouldn't have the Lisbon Treaty result another level with another referendum in France, by the way.
Therefore, I could understand why Nicolas Sarkozy was so reluctant to do a treaty amendment is that it is in my political lifetime, never again.
And then he agreed, Yes, we will go.
And then the prize the British government asked was not and it was not acceptable, by the way, and therefore we had to go in a non in other ways.
By the way, 25 member states signed and as soon as as the time of President Klaus will be ended, even the Czech Republic will sign.
Then you are the only member state who will not part of the fiscal treaty.
Therefore, this question is a question to the UK as well.
But I think the most the most is the argument for too few British people which are not pro-European to a few.
The most argument is that the eurozone is not well functioning to better resource the eurozone,
the more convincing that will, I hope there will be even more. But as discussed.
And so we will do whatever but but what is needed.
But it was impossible not to buy it and to get. But of course you are.
You are right. There is a dilemma. Strengthening the euro will build requests, some progress.
And I am optimistic that at the end Europe will be stronger than before because of crisis.
But of supporters have been always realistic, pragmatic and very wise.
But we trust in the wisdom of the Polish people. Yeah.
So you.