Europe’s economy needs no governing

In this interview with café babel, Katinka Barysch, chief economist at the Centre for European Reform, dismisses the idea that the UE might need a stronger harmonisation of its economic sphere.

As the chief economist at the Centre for European Reform, Katinka Barysch is a high-profile analyst of European economic integration. She believes that the rivalry between the different economic and social models within the Union strengthens the EU’s overall global competitive standing.

What do you judge the economic consequences of the Constitutional Treaty to be?
From an economic point of view, the new Constitution will not make any significant difference as for the most part it carries over the pre-existing clauses from the current treaties. This Constitution will not make Europe any more neo-liberal or state-dependent. As a result, those from both ends of the political spectrum are unhappy with this text. On the one side, the French Socialists have interpreted this Constitution as an instrument of neo-liberalism and have all but rejected it. Here in Great Britain it is seen as a conspiracy constructed by the Social Democrats on the continent which aims to force German or French style socialism onto Britain.

Economists like Stefan Collignon and Heinrik Enderlein are promoting the idea of a federal governance of the economy in light of the European economic misery of today. Do you subscribe to this view?

No. We most definitely do not need a federal governance of the European economy at the moment. Northern countries such as Denmark and Sweden have demonstrated that inside today’s Europe it is still possible to effectively combine economic efficiency with social security. The EU is a huge labour market in which alternative economic policies can be tested simultaneously, and the successful ones offered to other countries for implementation. I therefore see no reason for stronger harmonisation of the economic sphere.

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Please visit café babel’s website to read the full interview with Mrs. Barysch.