economy and finance
A plan to get the eurozone back on track
In the last years, European citizens have lived through one of the worst economic crises since the great depression of the 1930s. What started as a financial problem was soon to become a dire moment in the history of the continent
With the financial system in complete meltdown, EU leaders were resolved not to let the economy stifle and proceeded to push for bail-out programmes to save the financial industry taking in millions of euros of public debt, further depressing the financing conditions of Member States.
Instead of a strong and structured plan to work as a whole EU, the conservatives’ proposals focused exclusively on austerity and sought to create an unacceptable division among stronger and more vulnerable EU members. This path was proven wrong time and again.
Together with its member parties, the PES proposes a progressive way out of the crisis, to be applied without further delays:
The measures outlined so far in the economic governance package focus mostly on bringing national deficits down, by shrinking the public sector and deregulating the labour market, instead of promoting a strategy focusing in economic growth and the creation of fair jobs.
While there is a need to keep national budgets under control, this cannot be the only objective of economic policy. The fact that austerity measures have gravely aggravated EU’s economic output, has finally spurred the EU to launch a concrete Investment Plan to create jobs and fostereconomic growth to tackle the crisis. The acceptance that only through a vigorous Investment Strategy will the European Union be able to foster economic growth and create new and decent jobs is a great achievement of our political family. The European Investment Plan has the potential to pull Europe out of the crisis but it needs our political steering. The PES is committed to set up an effective investment strategy for Europe to relaunch key sectors of the economy with a comprehensive social dimension, paving the way to sustainable growth.
With eurobonds in place, countries would be able to issue sovereign bonds with the backing of the EU up to 60% of their GDP. This would mean that countries would be able to finance themselves at reasonable interest rates, for at least part of their debt. Above a given threshold, most countries would pay their own individual interest rate, without the guarantee of the EU.
Eurobonds could then work as an incentive to keep debt below the agreed threshold as well as to help countries financing key economic sectors.