Say it quietly, for fear of causing heart palpitations across the Irish political spectrum, but a new EU treaty is looking more and more likely, possibly as the German price for coughing up the hard earned taxes of the German people to save the euro. If we are to have a new treaty, what should be in it?
1. An alternative. We just can’t get into the usual Irish carry-on of voting No and then trying to blackmail the rest of Europe into more concessions. Therefore, as this treaty will be primarily about how national governments run their fiscal affairs, the treaty should be outside EU law. In other words, a multilateral treaty between member states that just happen to be EU members too. This way, even if a country refuses to ratify it, the other countries can go ahead agreeing policies outside the EU which they then apply inside the EU as a group. We can add a clause that allows the treaty to be merged with the EU at a later date if every country eventually ratifies it. But it means that there is a Plan B to deal with a potential No vote, that is, we ain’t stoppin’ for no one. Countries that refuse to ratify should be respected, as should countries that refuse to bail them out anymore. After all, we must respect every country’s sovereign right to bring in massive cutbacks instead of being bailed out by other countries.
2. A mechanism to create Eurobonds, with a veto power for any member state that will be a net contributor in terms of having to pay higher interest rates, or, alternatively, an EU tax (perhaps on petrol?) to subsidise those same countries. The beauty of a tax on petrol is that national governments could choose to shield their citizens from it by lowering other taxes, but that is a national decision for them to make. The purpose is to demonstrate to citizens of contributor nations that they are not seen purely as the EU’s cashcows, which is politically important. The Germans, Dutch and Finns vote too, you know.
3. In return for accepting cheap Eurobonds, member states effectively cede spending level controls to the Eurozone council of ministers, again with contributor member states having a veto. The council would have a right to tie the level of spending to revenue. However, the council should be specifically barred from interfering in what types or levels of taxation are raised within a member state. The objective is to balance books, not meddle in matters of subsidiarity.
4. The democratic issue needs to be addressed, and not through the failed European Parliament. The head of this new structure needs to be directly elected by the people of the Eurozone. As for the usual “Where is the European Demos” arguments, they are still smaller obstacles than the giant sucking sound that is European democracy. The vacuum has to be filled by voters in polling stations. After all, if we all know who Rick Perry is, I’m sure we can figure out who our candidates are.
Of course, if British eurosceptics decide to use this opportunity to look for some concessions for Britain, this thing is going to get very messy, although long-term, having the British outside but on friendly terms would suit European integration much better. Putting Britain in a position with a Eurozone comparable to her position with the US worked out fine for the Americans, didn’t it?