‘Not my fault’ or Would Spreading the Maastricht Wisdom beyond Europe Really Do Much Good at All?
Résumé
EMU in Europe involved the launching of an unprecedented economic policy architecture. Contrary to US-style monetary union, Europeans decided they did not need the federal financial clout that would allow them to carry out an effective redistribution policy between member states on a grand ‘European’ scale. With an upward limit of about one per cent of European GDP and torn as it is between the common agricultural policy and structural funds, the Community’s budget can neither boost an agricultural revival nor assure the realignment of poorer regions. Euroland seems to be better characterized by its shadowing of US theoretical models than by its shadowing of US institutions. In particular, following the seminal contributions by Kydland and Prescott (1977), Barro and Gordon (1983), and Rogoff (1985), the European Central Bank (ECB) was granted independence without political accountability, while national fiscal policies were capped so as to prevent their alleged inflationary tendencies from jeopardizing the ECB’s objective of ‘price stability’. Moreover, governmental power was distorted to such an extent that governments may have to turn to the European Commission for recommendations on their national public finances (the Stability and Growth Pact, SGP), or even on structural reform (Broad Guidelines for Economic Policy). The institutional provisions that contribute to the democratic deficit afflicting the European Union (EU) add up to a long list.