In monetary and financial matters public declarations do not imply a guarantee of efficacy.
Once again Europe has experienced this with regard to the creation of a financial aid mechanism for Greece. It is under fire from its critics because of its internal discord and reticence. It has opened the door to speculators just as the international ratings agencies are doubting, probably incorrectly, the ability of some of its members to pay off their debts. In addition to this public debate has digressed off into irrelevant comment. However the issues are of major importance.
Solidarity mechanisms within the Euro Area were not part of the original plans for the single currency. They must become so in a clear, detailed manner. If we share the same currency we are also mutually obliged.
Firstly in terms of applying the same rules and employing the same discipline. Then we should support each other, if necessary implementing procedures that have previously been agreed upon.
But in the same way as the International Monetary Fund comes to the aid of States who are struggling with their balance of payments, imposing on them in exchange a draconian tutelage and conditional measures for recovery, the Euro Area also has to develop similar measures to the full. This would demand the modification of the European treaties to enable this type of aid to be given and to enhance European tutelage over a failing economy. We must work towards this now.
The European Central Bank which has proven itself during the crisis seems to be the best placed to implement these mechanisms for aid, guidance and monitoring. It should also be able to intervene more freely on the markets in the same way as the other major central world banks.
Today Greece is asking for the Union's solidarity to recover healthy accounts. It has to be able to count on this. But right now in order to help it the Euro countries will need the IMF for its expertise and to push through with austerity.
We should regret this since the best solution for the European currency is to settle its problems alone; the credibility of the euro's sustainability together with that of the European Union should urge us to avoid this ever happening again