I want to start by congratulating Mr Rosati for his text and to thank him for it. However I would suggest that we should be more critical of the way in which the growth survey has been put forward and the way by which it has been launched. I think we have to be also realistic in the sense that we have to admit that there is a big cleavage in this committee, within this parliament, between two ways of handling the crisis. On the one hand there is the predominant move forward towards fiscal consolidation and on the other there is the other approach of working towards expansionary policies. We don’t agree on these – there is the majority who wants fiscal consolidation and thinks that’s the way forward and quite a big minority that says the contrary, which wants focus on expansion first. In order to move forward we have to accept that there is this cleavage and we also have to accept the fact that we are not just technocrats. People expect from us a political reply and that political reply must reflect the fact that as shown from the last parliamentary election, there is a big dissatisfaction with the way that the European economy is developing. So I believe that in our reaction to the growth survey we have to reflect that dissatisfaction. There are thinks which we agree, facts that we agree upon. For instance we agree that the economic growth rate of Europe are suboptimal and have been like this for a number of years, we agree that unemployment is too high, we agree, as Mr Rosati just said, that investment – public and private, have been too low and has stayed too low. Where we disagree is how to interpret what has been happening and how to deal with the situation. I would therefore like to make some remarks in this context. First of all if we look at the Eurozone from a long term perspective, one has to conclude that it is a sub-optima monetary zone, it is not an optimal monetary zone and has therefore been the subject of an ongoing political process by which we try to compensate for the problem. Economic divergence has actually been increased over the last few years rather than decreased in spite of the compensatory mechanism that has been introduced. This is something we have to accept and it is in this light that we should interpret and understand then what the commission is proposing in its growth surveys. We lack the centralising focus of a monetary union and on the other hand an attempt has been made to compensate on that by discretionary mechanism that are politically controlled like this semester process it’s a political process – we have to accept that as well. And we have to interpret what goes on in these terms. So what has been the major development in all this it’s still the same development that the commission is proposing? Ok we are talking about 3 pillars but the real pillar has stayed and is going to stay as a primary tool of cohesion fiscal consolidation and that is something which we are trying to steer to on the basis of a number of measures, score boards, quite a positivist approach to the problem. You have the tools, the instruments, the measures by which to calculate how things can be steered towards a certain direction and you move on that basis. But we are not under control of the situation. And one reason for that I discussed with Mr Rosati actually is that the markers we have are historically based. They relate to a situation that goes back quite a number of years ago. When we talk about 3% of GDP as a definition of how deficits go askew, it relates to a reality that goes back 22 years. Therefore the problem could be that the instruments that we are working on that are being implanted in the surveys that we have before us are not good enough and they are giving us wrong results. They are giving us indications, on what we work, that are faulty. I’ve been looking at the autumn forecasts made by the commission since 2010, 2009. Looking at the forecast they did, year after year, every year the autumn forecast is 2 to 3 up stand so if you look at the year 2011, there are 3 forecasts for growth in the year 2011 – 1.5. 1.5, 1.5. The actual was 1.4. If you look at the three autumn forecasts of 2012 – it started 1.8, went down to .5% – real – and the end of it was minus .4. The actual was minus .7. If you look for the forecasts of the year 2012 – it started at 1.8 growth, it went down to 0.5% growth, the third forecast was minus 0.4 actually it was minus 0.7. If you look at the 2013 report – starting at 1.3% growth, went down to .1% growth minus 0.4 growth. The realty was minus .5% growth. And if you look at the forecast report of the year 2014, they started at 1.4%, went down to 1.1% and down to 0.8%, its going to be less than that. So what is my point? My point is this – we think we have the measures by which we think we understand what’s developing but we don’t. We have instruments that need to be audited, that need to be critically considered and we are not doing that. So all the time, even when we talk for instance about fiscal consolidation – there is necessity for some fiscal consolidation – but in reality it is operating as an internal devaluation. And an internal devaluation is politically very dangerous, socially dangerous and economically ineffective. This is the real problem. And that is why then, when we come to interpreting how things move forward, we differ. It is not just a question of a technocratic assessment. It has to be a political assessment. What does internal devaluation mean? It means this Mr President. That the Eurozone has locked itself into a situation where, to remain competitive, through internal devaluation, it’s eroding the social model on which Europe is based. There is no other way out. To become competitive you have to erode your social model, and that is of course a trap, a trap because it undermines social cohesion. Are we on the right track? The commission is basically telling us, and some of our members are telling us that we are on the right track. But if you look at the policy that has been following for these past 3, 4 years – and you ask – look at the economy – has the economy been moving? And they tell us yes it’s going to move, it’s going to move. I remember Galileo, back in the Counter Reformation, and he understood that the sun doesn’t go round the earth but the earth goes round the sun. He had to accept that he was wrong – but then he also said ‘eppur si muove’ it still moves. Well before the European economy as it is moving now, and they tell us it’s going to move, it’s going to move, eppur non si muove – it’s not moving….that is the conclusion I come to Mr President.
((((It was on the first presentation of the draft report on the “European Semester for economic policy coordination: Annual Growth Survey 2015″, where here Dr Sant is the shadow rapporteur on behalf of the S&D group.))))
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