PES leader: ‘Golden Rule’ should not be imposed

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The introduction of a deficit-limiting 'golden rule' in the EU countries' constitutions on an obligatory basis, decided at the recent EU summit, is likely to raise questions because in most countries neither the parliament nor the society has been consulted, Sergei Stanishev, leader of the Party of European Socialists (PES) told EURACTIV in an exclusive interview.

Sergei Stanishev, leader of the Bulgarian Socialist Party and former prime minister, was elected on 24 November as leader of the Party of European Socialists, replacing Poul Nyrup Rasmussen, a former Danish prime minister who held the office of PES president for almost eight years. Stanishev will serve in an interim capacity until a PES congress in Bucharest on 28-29 September 2012, when the next leader will be elected for a two-and-a-half year period.

He spoke to EURACTIV Senior Editor Georgi Gotev.

?To read a sort article based on this interview, please click here.

Following the 8-9 December EU summit, I visited the website of the Party of European Socialists and saw no reaction. So my first question in your capacity of leader of PES is what does the European centre-left party think about this summit?

The group will have its own statement and position which will be discussed in the forthcoming days.

But generally speaking, politically, there's not as much progress as was promised from the point of view of addressing the financial crisis, the problems with the eurozone. It had been promised that it would be a 'historic' summit and that there would be decisions which would exactly tackle the crisis.

When you have a hole in the dam, you first fill the hole and then start reconstructing the dam because it's an emergency situation. This is what was expected both by the citizens of the European Union and by the markets: A very clear political signal that Europe, the European Council, would do everything necessary to provide the stability of the euro.

And from this point of view what is needed is not what has been proposed but different measures, in many ways.

Mr Cameron vetoed a possible treaty change and therefore there was not a lot of choice for EU heads of state and government for historic decisions. The PES was against the treaty change, probably because it takes a very long time to make those changes. Does it mean that PES favours the intergovernmental approach?

No, I wouldn't say so. The major difference between what has been agreed at the European Council and the PES is that we actually believe that there is a need for a policy change. We have formulated quite clearly our alternatives, which are missing in the Council's agreement.

There are two things missing: The means to provide growth and jobs, and real solidarity in the European Union. What was needed at this stage, and is still needed, is to grant the EFSF [European Financial Stability Facility] a banking licence, to go towards introducing eurobonds by joint guarantees of the EFSF by member states, the imposing of a financial transactions tax, and a real plan for investment and growth. Theses are our alternatives, which are well-developed economically and politically.

Actually what has been agreed is a continuation of the policy we have been seeing for over two and a half years. That there are measures taken too late, which are not sufficient from the point of view of the markets. And you can see that the reaction of the markets is not overenthusiastic.

Of course there are concerns when you mention this intergovernmental approach and agreement. There are concerns which exist related to the role of the European institutions and the community method.

You mention growth and jobs, but isn't it a bit surrealistic to speak about growth when in fact everyone understands that we are already in a recession? It's difficult to imagine growth when the banks are not lending and when basically business is at a standstill. You also mention solidarity. However, in the present climate and in the discussions over the EU budget net contributors to the EU budget are pushing for a different agenda. They would like 'excellence' to replace cohesion. How would you comment on that?

This is exactly the problem. Because when you only focus European policies on the fiscal targets and on financial stability, if it is not combined with a plan to create growth, to create jobs in the European Union in the medium-term, there will also be no fiscal stability.

Because if the economy is not working, if there is no growth, then there will be less income for the budgets of the member states – and this is the main issue.

If you consider that for almost three years practically every government has been taking measures of budgetary restrictions, austerity measures, which are visible, but it doesn't calm down the markets. It doesn't provide confidence for the eurozone and for Europe as a whole.

This is why we believe – of course there is a need for fiscal responsibility, everyone understands that – without a combination of coordinated measures from all the member states to create conditions for economic growth, we shall just be sitting back and looking at how recession is coming and the consequences will be really disastrous for every country of the European Union and for the citizens.

Secondly, indeed, there is this tendency that the countries which are relatively well-off, the triple-A countries, to say: "We're not willing to pay for the PIGS". But look, what is the situation with the sovereign debt even of those countries which are not threatened at the moment?

According to the IMF [International Monetary Fund] figures for next year, it is expected that German debt will reach more than 80% of GDP, in France almost 90% of GDP and in Italy it will exceed 120%.

So if you look at this situation of the eurozone, there is a need for greater solidarity and this is exactly what we are proposing through the means I mentioned above, especially regarding the EFSF, the introduction of eurobonds and the other measures including an expanded role for the European Central Bank.

Because what people and the markets are expecting at this moment is a very clear and common signal. This was not reached during the European Council unfortunately. There are some minor positive change but they are quite limited.

When you were elected as leader of the PES two weeks ago, you warned against a Europe of different speeds. Don't you think an intergovernmental approach will precisely go into this direction, in the sense that community institutions were a safeguard for preserving the unity of Europe?

This is one of my concerns. Indeed, because, apart from everything else, this crisis is also triggering a political crisis in Europe from the point of view of a democratic deficit in the decision-making process.

Because you can see in the last weeks, there were many bilateral and trilateral meetings which were actually formulating the approach and in many ways the decisions of the Council were imposed by the two most powerful countries in the European Union, by the chancellor in Germany and the president in France.

And looking from the point of view of substance, it seems the substance is more what Mrs [Angela] Merkel was proposing and the form was more what was supported by Mr [Nicolas] Sarkozy. Because they're having this Golden Rule imposed and everything else on the one hand, and on the other hand they have the intergovernmental approach.

And it is a risk, because people in Europe are asking now: Is the European Union democratic enough? Because every country and every citizen will have the burden of the decisions taken on his or her shoulders.

You mention the Golden Rule. Are you or the PES against the Golden Rule?

There is a Stability and Growth Pact. It has quite clear rules from the point of view of fiscal discipline. For many years, and I must underline this, right-wing governments were often violating this rule. This was observed without any actions on behalf of the European institutions and without even serious debate.

You should, for example, remember what heritage Mr [George] Papandreou as the prime minister of Greece received from the centre-right government of New Democracy: 14 or 16% deficits and huge debt, above 140% of GDP.

And from this point of view, as I said, everyone was moving towards fiscal restrictions. There is no government in Europe which would not take it into consideration and take concrete action. But only fiscal rules, only financial issues which would address this part of the problem are not really addressing the problem of the crisis in Europe.

But are you for or against the Golden Rule, in terms of introducing a constitutional requirement not to go beyond certain budgetary thresholds as Germany has already adopted. Mr François Hollande is clearly against.

I don't think that the pressure of one country should be the major driving for any European decision. To synchronise the constitutional legislation of all the countries for what is expected by Germany is not the best approach. It's not very European in many ways.

So basically you are against the Golden Rule?

Well, I can say that in many countries there will be very serious debate. And this is also related to the approach because in most countries all these proposals neither the parliament nor the society was broadly consulted.

Speaking of your role as PES leader. We've seen statements by an important representative of the French Socialists, Arnaud Montebourg, which sounded anti-German and had a strange resemblance with some statements by the French far-right leader of Marine Le Pen. He was seeing Germany as a threat. How do you deal with such situations where socialist leaders in an EU country are making unacceptable political statements?

Well honestly I have not read the statement and it is difficult to comment on something I haven't seen. I can say very clearly that the PES is perhaps the most pro-European political party in the European Union and we have always counted on the mutual solidarity of the countries in the Union which excludes the domination of one country.

At the same time, we are strongly in favour of all democratic instruments in the European Union being developed and of the community method.

Germany and France are of course two very important countries of the European Union because they are the largest countries, the most numerous in population, economically very strong.

It doesn't mean however that any single country should dominate and this has never been the approach of the European socialists and will not be because we strongly support the European democratic institutions including the role of the European Parliament.

Because look, you know that for many years, and now this feeling is even deeper, in Europe people demand more democracy at the European level. The European Parliament is the only European institution which is elected directly by the citizens and I think that the role of this institution should be respected by everyone, every country and every other institution in the European Union.

Let me ask you also about Russia. There are protests and Mr [Mikhail] Gorbachev said that the elections should be repeated. Does the PES have a position on that?

Our position is that elections should be democratic and fair and there were observers – as you know – from the OSCE and other institutions which showed a number of irregularities, which is not very positive.

I cannot tell you what exactly was the scale of these irregularities but I think that many Russian citizens during the rallies which happened in a number of towns and cities in the last days are definitely a signal to the authorities that they are expecting the laws to be respected and to have free and fair elections which is of particular importance for the forthcoming presidential elections.

Does the PES have a sister party in Russia?

Well, there isn't a party which is the member of the PES but the party 'A Just Russia' is a consultative member of the Socialist International.

There are two summits to be held this week: There is an EU-Russia summit to be held and an EU-Ukraine summit. There some degree of is uncertainty whether they will take place, especially the Ukraine summit. What do you think the EU should meet with Mr [Viktor] Yanukovich?

Personally I think that a dialogue is a better method … in terms of influence. If you have some statements and positions it's better to say them very clearly to the counterparts but of course I couldn't say in these particular cases what should be the positions of the European institutions because I don't know all the details.

What is next on the PES agenda? Are there any big meetings or important elections? Everyone is thinking of course of the French elections…

Well the French elections are the most important elections next year all over Europe and of course all the PES activists and the member parties will do everything possible to support our friends in France, not only because we support François Hollande but because it's extremely important for Europe.

Europe for many years now, especially the last three years, has been in the hands of the centre-right governments and the EPP [European People's Party]. Their approach towards the crisis – austerity only – is not resolving the problems which the crisis created.

Neither is the eurozone more stable, nor the economies better off, and nor has unemployment been reduced. We need a different kind of atmosphere in the European Union. We need more governments which will be sharing our views regarding the importance of the plans for investment and job-creation, bolder measures for the stabilisation of the eurozone and supporting the individual countries.

And I think this is what will happen if the candidates of the French Socialist Party win. There are pretty good chances for this and it will be very important for Europe as a whole, not only for France.

We can see now this tandem between the chancellor of Germany and the French president really imposing their bilateral positions on the rest of the countries because everyone understands that without France and Germany there cannot be a common solution and approach.

Otherwise the PES has many other activities next year apart from the elections, not only in France of course, but in Greece, Slovakia, Lithuania, maybe in other countries as well.

We shall continue developing our alternatives in economic policy at the European level, which has been done very successfully by Poul Nyrup Rasmussen who had been leading in recent years. And we shall also continue our preparations for the next European elections to develop and prepare our fundamental programme.

We also have other initiatives related with the process of nominating our leading candidate for the European elections in 2014 to be president of the European Commission.

For the first time there will be a very clear and democratic process involving all the parties in the PES so European social democracy will be very clearly outlined and distinguished as an alternative to the EPP-dominated European institutions at this moment. We need a change, the European Union needs a change.

Finally there are many other international activities including a second conference that the PES will be holding on the Arab Spring in Cairo because we have been supporting this democratic process from the very start.

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