Local view for "http://purl.org/linkedpolitics/eu/plenary/2003-09-23-Speech-2-014"
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"en.20030923.1.2-014"2
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"Mr President, taking Mr Duisenberg’s place will be no easy task, since the current President successfully guided the Central Bank through the formative years of the single currency and, above all, since the need for a more generous monetary policy is becoming crucial for economic growth.
In his answers before the Parliamentary committee, Mr Trichet emphasised, among other things, the fundamental role of realism and pragmatism in assessing the economic and financial climate at a time of such rapid change. That realism and that pragmatism are, indeed, exactly what is expected of the new president. The citizens of Europe are calling for more economic growth and more employment. Most of the politicians who represent them are calling for more budgetary flexibility and monetary understanding, given the economic crisis which Europe is experiencing. We fail to heed or respond to these worries at the cost not merely of leaving matters unresolved, but also of giving impetus to the collapse of the single currency’s credibility, in the wake of which citizens’ loyalty to Economic and Monetary Union will be weakened.
The results of the Swedish referendum and the recent surveys of the level of commitment to Europe in Norway are a sobering warning. We can no longer gloss over the fact that citizens are starting to think that the cost of the euro is too high for Europe. The Stability and Growth Pact, of which the Commission is the guardian and the European Central Bank a fierce advocate, reflects a noble and fundamental ideal, but the way in which it is drafted is not satisfactory because it fails to address crisis situations such as we are in currently.
Defining broad guidelines for public spending is more important than the level of deficit. The pact does not take this principle into account. Encouraging the deficit in order to lower taxes – a policy which when implemented in isolation brings only a few economic benefits, and always creates inequalities – is one thing; accepting the deficit as the result of investment policies that really do help the economy recover is quite another. The Keynesian benefits of increasing public spending dry up over a certain level, it is true; it is also true, however, that the launch of subsequent initiatives to promote economic growth, which is absolutely crucial to recovery, will never be possible without increasing public spending.
Besides, it is very strange that there is so much talk today of economic growth initiatives, when the reforms and goals defined for that very purpose in the Lisbon Strategy are still so far from being attained. The ECB, then, is required to show the realism and pragmatism recognised as essential by its President-Elect if the economic system based on the single currency and the common monetary policy, which was constructed so laboriously and with such difficulty, is not to be threatened with collapse. That responsibility, moreover, is in the hands of Mr Trichet. Good luck!"@en1
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