03 April, 2020
A FEDERAL EUROPE TO OVERCOME THE CORONA CRISIS
10 proposals by the European Federalists

The last weeks have seen the Coronavirus crisis spreading throughout Europe, which has become the world epicentre of the pandemic. Europeans are facing, together, the most severe crisis since the Second World War. 

The Union of European Federalists welcomes the measures taken by the European Commission establishing a coronavirus response team and an investment fund as well as expanding the scope of the solidarity fund to support some immediate actions for the crisis. We welcome also the decision of the European Central Bank to set up a new Pandemic Emergency Purchase Program to protect the integrity of the Eurozone and support member states in need to increase their indebtedness to face the crisis. The solidarity shown across European regions to share the care of some severely ill patients is also welcome sign of European cohesion.

At the same time, the Coronavirus crisis made clear that the European Union has no competence on health care, while it has only a support competence in public health, and that it is neither equipped with the necessary instruments to ensure an effective coordination for such typically transnational emergencies. Therefore, Member States remain exclusively competent for the management of their health care systems as well as for the management of the economic and social consequences of the epidemic. Without surprise, the Coronavirus crisis management by the national governments confirms once more the ineffectiveness and the limits of the inter-governmentalism. Lacking a European government with adequate European instruments, national governments are left to protect their own citizens and interests as they can. The result is that today our countries are overwhelmed.

The Union of European Federalists regrets that this prevents, in particular, the Union from giving an effective and coordinated response to the Coronavirus threat and replying to the EU Charter obligation of providing a high level of Human health protection to all EU citizens and people living in the EU. The Union of European Federalists regrets moreover the lack of solidarity amongst Member States as called for by Robert Schuman 70 years ago in his declaration of 9 May 1950.

For these reasons, the Union of European Federalists calls for the following urgent and longer term measures: 

1. It is essential to ensure the unity of the European Union and its internal market. We should reverse, as soon as possible, all decisions to reintroduce internal border restrictions between Schengen countries, which do not help stopping the virus since outbreaks are regional rather than national but risk jeopardising the smooth functioning of services, such as food provision and health care, that are all the more essential in this moment. The unity of the internal market, as well as the free movement of people and goods, especially relevant in cross-border regions, must be ensured. That’s why only the necessary and well proportional measures shall be taken for the temporary restrictions of people and goods mobility at the EU external borders;

2. The European Commission should also be given the power to issue rules applicable across the EU on measures to be applied by member states to combat the virus;

3. A European research consortium should be set to work together as a team to find a vaccine as quickly as possible. EU funding allocated to different research projects is a welcome move, but there is significant added-value in developing joint EU efforts rather than national parallel ones;

4. The Eurozone should immediately adopt a series of extraordinary and coordinated fiscal measures to mitigate the effects of the current crisis and its consequences on the European economy. The ECB’s government bond buying programme is an essential move but it will not be enough to keep borrowing costs for the most affected member states within tolerable levels. If there has ever been a time for a European response to avoid another long recession, this is it;

5. The Eurozone must now quickly advance to introduce real European bonds, raising affordable new capital to address the immediate spending need of the European Union and member states to contract the crisis. This could take the form of European Recovery Bonds to be issued by the European Union itself to finance an EU-wide plan to promote EU economic recovery and social cohesion during and after the emergency;

6. The scope of the European Stability Mechanism should be enlarged to finance the immediate strengthening of the European and national health systems to cope with the health and environmental crisis, which threaten the lives of European citizens, and thus also the economic and financial stability of the EU. The Eurogroup must activate ESM’s support for all affected member states without attaching additional conditionality to it;

7. The Council should immediately approve a sufficient Multi-annual Financial Framework increasing the budget to at least 1,3% of the EU GDP, as requested by the European Parliament, plus any resources raised through the European Recovery Bonds, and allowing more flexibility, in particular to make it possible to launch a comprehensive European anti-crisis spending plan;

In the longer term

8. The EU should be provided with fiscal autonomy at European level based on the right to directly raise and spend its own resources – such as the carbon tax, the digital tax or the financial transaction tax. Such fiscal capacity will allow to finance a proper EU budget and efficient European policies starting with the research, industrial and environmental policies, which are proving even more necessary in the context of this crisis. It would also enable the issuance of real European bonds without need of national guarantees by member states;

9. The EU should be entrusted with real competences in the field of public health which should be a shared competence between the EU and its Member States. As a matter of priority, the EU should start setting the basic rules of a EU policy in the areas of public health, and even possibly health care delivery, so as to provide the Commission with powers to coordinate the response to future epidemics among others and develop strong mechanisms for responding to public health emergencies, as any federal government should do;

10. The planned Conference on the future of Europe should be turned into a fully-fledged European Convention to draft a new Constitutional Pact to answer current and future European challenges.

We should acknowledge that the world after COVID-19 will not be the same as before. Europeans need to pursue a true eco-social market economy, that makes our society more resilient, strengthening the link between the environment and economic growth, as well as acknowledging the importance that a greener and sustainable economy could have in future crisis of the same nature. Without a systematic integration of ecological factors, neither economic competitiveness nor social justice can be achieved in the long run.

The EU and its member states are going through a decisive test, of effectiveness and solidarity, which will profoundly affect the perception that citizens have of our Union for a long time to come.

This crisis is showing that we need strong and resilient local communities. However, some challenges we are facing today – as this crisis demonstrates – can neither be met at local nor at regional or national level. They require a European response, following the principle of subsidiarity. Federalism is the only institutional system that can provide both subsidiarity and substitution.

All at once, the Coronavirus crisis is an opportunity to address the shortcomings of the Union. We must urgently leverage on the lessons learned during the management of the Great Recession of 2008-2018, when the citizens paid dearly for the lack of solidarity at European level, and develop a European answer to the Coronavirus threat and its economic and social impact to transform the European Union into a federal Union that is a community of solidarity with a shared destiny.
 


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