“A Europe-wide election for the Presidency of the Commission or Council is the most direct way to involve the public,” the former British prime minister said.
Addressing the Council for the Future of Europe in Berlin, Blair said some differentiation in the speed of European integration was now inevitable as eurozone leaders sought to match economic governance with political structures.
Echoing German Chancellor Angela Merkel, he said Europe needed “one political settlement that accommodates different levels of integration within it” or risk a break-up.
Blair said that the path towards deeper integration was opening up a “democratic deficit”, namely a gap between European-wide decisions and the accountability of the European institutions making them.
The former prime minister said he would like to see the UK take a “constructive role” in shaping a "Grand Bargain" for Europe, recognising the need for closer political union to solve the eurozone's sovereign debt crisis.
He made it clear that he envisioned Britain in the second-tier of a Europe at two or three speeds and that other countries would have to “accommodate the UK’s very special position in the financial sector”.
But he said Britain should not interfere with the eurozone's integration process. "Despite UK objections, more majority voting in some areas can be justified, [and] is even essential to make Europe work. Without it, we can get paralysis when we need movement."
Blair is now a representative for the "quartet" of the EU, United States, Russia and the United Nations in the Middle East.
He acknowledged that Europe's multi-speed integration would be a difficult task that will require careful balancing of divergent national interests. But he said it was “an essential one if the UK is not to be side-lined and Europe to be without the active participation of such a large and significant member of the existing Union.”
The former British Prime Minister also appeared to back calls for the UK to hold a referendum on the new European political architecture that will emerge from the ongoing integration wave.
"I can’t see any new political settlement being acceptable without direct popular consent through referendums," he said, without naming the UK in particular.
“Let’s be blunt here … It is massively in Britain’s interest not to play short-term politics with this issue.”
Blair said so-called ‘ultra eurosceptics’ - those in opposition to the EU project - “were on the wrong side of history”.
He said that faced with the economic crisis “the underlying, profound rationale for Europe and its union is stronger than ever… In this new 21st century geopolitics, Europe carries weight, multiplies opportunity and makes sense for its individual nations.”