The commission’s 2017 reflection paper on the deepening of the economic and monetary union : a few critical observations

Abstract

In the present paper I critically asses the Preface to the 2017 Reflection Paper on the Deepening of the Economic and Monetary Union and identify two issues with the European Commission’s approach and reasoning which I believe reveal a deeper, more disquieting dynamic. First, I claim that the Preface makes an overly optimistic evaluation of the single currency, ignoring or not placing enough emphasis on some of its more problematic aspects. I also show that this attitude generally permeates the rest of the Reflection Paper. I identify three sentences from the Preface which I believe clearly illustrate this point. Second, I criticize the Commission’s failure to explicitly recognize the shortcomings of its pro-austerity policies, even after it has become abundantly clear that such policies have proven to be not only inefficient, but also counterproductive in nursing EMU countries back to health after the 2008 Financial Crisis. This is troubling, and a missed opportunity. The Reflection Paper, which forms part of a broader strategy aimed precisely at resolving the issues arising from the 2008 Financial Crisis and avoiding future recurrences, was an ideal opportunity for the Commission to reassess its reliance on austerity policies as a response to financial downturns in the eurozone. To conclude, I speculate as to what the implications of these shortcoming might be for the eurozone and the EU moving forward.