Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I welcome members of the Constitutional Affairs Committee of the European Parliament and a number of their staff. There will be simultaneous translation and I would be grateful if my colleagues would be mindful of that as they put questions to our guests. I will hand over to Mr. Casini for some opening comments.

Mr. Carlo Casini:

I thank the Chairman for the welcome. I am sorry for being late. I apologise also that I do not speak English. It is one of my many limitations.

This meeting is part of a programme, which was started at the beginning of this term of the European Parliament and in which we are holding meetings in all of the EU member states. In particular, we are meeting bodies dealing with European affairs and the constitutional affairs committees of the member states. The goal is to get to know in more depth the fundamental problems relating to European integration, in particular, the balance that has to be struck between member state identity and European identity, member state sovereignty and European sovereignty, and democratic legitimacy.

These types of meetings were particularly necessary because in January the Irish Presidency will be starting and, therefore, we need to have closer relationships between the European Parliament and Irish institutions, and particularly between the Constitutional Affairs Committee of the European Parliament and the Joint Committee on European Union Affairs, which is one of a kind within the European Union.

The main problem facing us in the European Parliament is the economic crisis, in particular, looking for ways to overcome this crisis. We have many problems with unemployment, problems relating to growth and to balancing the budget, and also an institutional crisis at the heart of this. In order to overcome the crisis, we have looked into various treaties, regulations, different instruments and tools, and also at a range of different levels, we have looked at governance and European integration. The situation cannot be left as chaotic as it is at present. Something has to be done in order to get a grip on it and govern it properly. In fact, my committee has appointed two members, Mr. Trzaskowski and Mr. Gualtieri, who, sadly, cannot be present today, who have been tasked with looking into this and putting together a document on how we can govern Europe and the multi-tier governance that exists at present.

On top of this, we are seeing increasing disaffection amongst the people of Europe with regard to the European Union. This sense of lack of involvement in European affairs is something we really must overcome. We need to encourage people's affection for Europe once again. The 2014 European elections will be an important moment for all of this because for many years we have seen a constant drop in voter turnout and in participation in European elections. We must ensure that 2014 is the start of a new impetus for European integration. One of the means we can use to do this is to introduce the new political party statute, which we are looking into in my committee and on which we hope progress will be made under the Irish Presidency.

The next elections will be an important moment for us. We have to use them as a way of encouraging growth within the European Parliament and development in Europe. One of the things we need to do is to make use of one of the provisions within the Lisbon treaty which is to ensure that there will be uniform electoral law in all member states.

This is a major problem. In the past we have seen that the idea of having one single European college has not been approved or passed. We need to have new proposals from the European Parliament and from my committee to see how we can reform electoral law in Europe. We need to increase the legitimacy of European political parties. There have been various studies and groups looking at this, including the Van Rompuy working group and an inquiry launched by the German foreign affairs Minister as well as discussions and a report prepared by the French parliamentary assembly. I am sure the committee members are familiar with all of these. Other ideas put forward include allowing political parties to designate Commissioners or to some extent allowing them to vote on the appointment of Commissioners. It has also been suggested that they be given more of a say in who is appointed as the European Council and European Commission Presidents. We would be interested in hearing members' opinions on these issues and on all of the other questions that are currently affecting the democracy and representativeness of European Union structures today.

I have raised a number of problems as we see them at the moment and I am sure my colleagues will raise other issues that they wish to discuss. However, what we really want to hear are the topics, problems and issues that are most important to members of this committee.

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank Mr. Casini. I now invite my colleagues to respond to Mr. Casini's remarks. Following that, I will invite the other witnesses to contribute, if they so wish.

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I welcome our guests, who come at a very appropriate time in the context of European issues.

As a committee we have discussed this subject on a number of occasions and we have come to the conclusion that the issue that affects us to the greatest extent and the one on which we now focus the most is the lack of collegiality and solidarity among European member states, particularly when it comes to supporting a colleague or number of colleagues who may be in difficulty. Any organisation is only as good as it functions in a crisis. Unfortunately, the crisis that has beset the European Union is something the administration has struggled with. The European Commission has struggled and sought to do the right thing but not all member states, or at least not all representatives of member states, appear to be familiar with that concept.

One can talk about stronger links and indeed, the Commissioner was here a few weeks ago discussing just that. We agree that forging stronger links and greater integration are important. However, at the same time we hear on a daily basis members of the parliaments of various member states putting forward less than helpful suggestions, which irritate our electorate to a huge extent and, indeed, annoy them intensely. I suggest that as a priority we need to re-establish trust between the member states. We need to establish the collegiality and solidarity that Mr. Barroso has spoken about on many occasions. I am sure he also becomes very frustrated when he sees how some member states behave and react.

We have spoken in the past of the need for member states to stand together. There is no benefit in member states' scoring political points at each other's expense for whatever reason, and particularly for domestic political reasons. We seem to have adopted the worst aspects of the US system. For instance, the US has a single currency, but we have member states promoting the benefits of a multiplicity of currencies within the European Union. If there were a multiplicity of currencies within the United States of America, would it work? My belief is that it would not. One of the principal weaknesses of the US system is the mid-term elections, which invariably mean that any constructive programme that is being undertaken by the Government is snared and falls by the wayside. Perhaps the time has come for European member states to have domestic elections on the same day or as near as possible to the same day throughout Europe. At least then we could all be seen to be functioning together.

The disaffection mentioned by Mr. Casini is palpable at the moment. Ireland is in a severe programme at present and has no way out of it. Our domestic population is carrying an enormous burden and is doing so bravely. We fought a referendum campaign just six months ago at a very difficult time for this country and won, against all the odds. In those circumstances, we need recognition for our efforts instead of destructive comment, much of which comes on a fairly regular basis. I do not need to go further on that point.

Seán Crowe (Dublin South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I welcome the witnesses and thank them for coming.

It has almost become a cliché that Europe is at a crossroads, but clearly it is true for many people. A crossroads has been reached in many people's lives and they do not know what will happen in Europe in the future and how it will affect them and their families. A lot of people in Ireland are fairly critical of the failures of the European Union. They put a lot of the blame for the banking debt they have been lumped with on the EU and particularly on the failure to regulate the banking sector within the EU, as well as in Ireland. Many of the solutions that are being put forward by the EU appear to be recipes for more of the same, namely more integration and more centralisation. This is happening at a time when people have come to the view that these same policies are partially responsible for the economic collapse.

Many people were strongly in favour of the European project, particularly in terms of its potential to promote solidarity and equality. However, some of those who were critical of the EU experiment were always fearful that larger member states would come to dominate the new Europe.

Unfortunately, the forces produced out of this crisis appear to be pushing us in that direction. Larger European economies and governments are looking for greater say in the future of Europe.

The feeling in Ireland and many other countries is that we did not create this crisis. Few in Ireland benefited from the greed that caused the crisis. People in Europe are disillusioned with the lack of leadership from the European Parliament and other institutions. They do not see solutions and all they hear about is more austerity, pain and hardship.

I presume one of the reasons the witnesses are visiting Ireland is that they are interested in the views of Irish people and learning why we went down the referendum route. Do they take a view on the use of national referendums on European Union treaties? We take the view in Ireland that we have an opportunity to vote on treaties which other countries lack. Is part of the purpose of the trip to examine why countries such as Ireland hold referendums on EU treaties? Given what the witnesses have heard, do they think the current progress towards a banking and economic union will necessitate a referendum in Ireland and, perhaps, elsewhere? Are they aware of the stressful atmosphere that was prevalent among Irish voters during the recent referendum campaign? There was a definite sense that voters were not offered a choice and were being blackmailed. Is such an atmosphere conducive to the sustainability of political union in Europe? People believed they were forced to go down a particular route for fear of economic collapse.

The referendum revealed a significant class divide in how Ireland voted. A pattern was repeated across constituencies whereby those from a working class background rejected the treaty while more middle class areas voted in favour of it. Does that reflect public views across the EU? Do the results reflect the belief that the EU is increasingly associated with austerity and cuts among those who are most affected by such policies?

How do the witnesses see the EU developing in the coming years? Do they agree that many groups are using the economic crisis to push their own agendas in terms of demanding the centralisation of powers? Centralisation is a taboo subject for many people in Ireland. Rather than taking the route of centralisation we need to see more accountability through regional and national parliaments. Many people are sceptical about the social cost of austerity policies, and the longer we continue on that path, the greater the disillusionment with the European project. That is the message from polls across Europe.

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Many of the analysts who write about our current economic difficulties argue that deeper integration is required if the euro is to succeed and the economic prosperity of Europe is to be protected and increased. This is the essence of the difficulty we face at present. I campaigned on the opposite side to Deputy Crowe in the recent referendum but there is much truth in his remarks about the people’s opinion on handing over national powers to European institutions. The economic imperative appears to be deeper integration but in the middle of a deep and continuing crisis the political appetite for such integration is weak. Before the European project seeks to deepen integration further we have to be able to show our people that we can deal with our present difficulties. A tension exists between these imperatives. Eurobarometer polls of Irish people show a steady decline in trust in European economic institutions. While the referendum was carried by a large majority, it should not be assumed that it was driven by wild enthusiasm for the institutions in question. There is significant concern about their accountability to the people and the prospect of deeper political integration is limited while this crisis goes unresolved. We should tread carefully in the meantime.

Colm Keaveney (Galway East, Labour)
Link to this: Individually | In context | Oireachtas source

I support the sentiment of this engagement in terms of what it sets out to achieve. It is alarming, however, to see the Greek right wing party Golden Dawn policing the streets of Athens, Greek women prostituting themselves in the cities of Italy to feed their children and German companies preventing the sale of cancer drugs to dying EU citizens in Greece. It is difficult to speak about social cohesion in Europe when many of our citizens are becoming vulnerable and deprivation is on the increase on the periphery.

We have a great responsibility as democratic elected parliamentarians to prevent the rise of the type of cynicism referred to, vis-à-visthe role of institutions and states over the course of the past months and years. The alarming role of individual states in superseding the authority or the emergence of the authority of the institutions has reflected poorly on the authority of the institutions to respond to the paradigm shift of the economic crisis. Europe has failed to respond in the interest of its citizens vis-à-visthe crisis and the market has reacted more quickly than democracy has been capable of doing to address the concerns of the people of Europe.

Unemployment in Ireland is at almost 15%. Youth unemployment across Europe is accelerating at an alarming pace. Spain has horrific levels of youth unemployment. This plays into the hands of the people who police the suburbs of Athens tonight, who will attack public meetings of the left, of trade unionists and of immigrants and threaten employers who employ non-Greek workers. I would be interested to hear Mr. Casini's response with regard to the alarming disenfranchisement of people, particularly on the periphery of Europe. What steps can we as a committee take, in co-operation with the Parliament, in respect of bridging that gap of cynicism that is emerging where, invariably, young people will fall into one extreme of the political spectrum to protest against the failure of the institutions to deal with the social reality that emerges on the ground?

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Thank you. Would Mr. Casini like to respond now or would he like one of his colleagues to respond?

Mr. Carlo Casini:

Thank you. I would be happy for my colleague, Ms Gurmai, to respond.

Ms Zita Gurmai:

Thank you very much. Mr. Casini has a very busy schedule, but it was very important for him to meet this committee as it takes integration seriously. I would like to make a point concerning youth unemployment. What does Ireland expect to achieve in this regard during its Presidency? What minimum and maximum achievement does it expect? We know the three main goals of the Presidency and that the third of these is to deal with youth unemployment. I agree that the growing figure of 22.4% youth unemployment - 30% in Ireland - is very worrying. Every second Greek or Spanish young person is unemployed.

Over a year ago, the European Socialist Party and I, as president of the women's organisation, created a working group because we believed it was time to take this issue seriously. We recognise that the cost of 5.5 million young unemployed will be in the region of €100 billion. However, creating new jobs for them would only cost one tenth of that. Together with our colleagues in the European Parliament, we agree we should create credible new jobs, not jobs that come and go. We need proper jobs for the next generation. There is growing extremism in Europe and if we do not take care of the next generation, who will care for us?

Last year, the European Parliament and the Commission dealt with the pension report. I am looking forward to receiving details of the Austrian model and its youth guarantee. It is now functioning properly and within four years the Austrian Government has proved it works by having the lowest unemployment rate. The youth guarantee means that after young people leave school, they get a type of guarantee for four months to find a possible opportunity. This shows that the Austrian Government really cares. Deputy Crowe mentioned Mr. Barroso's speech on the state of the European Union. Of course, Mr. Barroso is very worried, but sometimes I get the impression that the Commission acts quite late. It spends more time inactive. Last summer, when the Greek crisis started, the Commission took a summer holiday. It should have taken more responsibility for what happened rather than let the market run on the issue.

As a shadow reporter of political parties, I believe we really need strong political parties. We have strong European institutions and the Council, which is quite strong. I believe we now need the strong power of the political parties. Our intention during the Irish Presidency is to make progress in this regard. Before the 2014 European parliamentary election, we look forward to having real debate on Europe's destiny. We look forward to each parliamentary party having a candidate for the Commission and to a wide debate on the destiny of Europe. Many parties are minority parties, but all need to be involved in a proper debate on European issues. I was the core rapporteur of the European citizens initiative, and I and my great colleague, Gerald Hafner, worked very hard on that. However, I would like to make it clear that what we wanted to do was to create an instrument for European citizens to allow them take part in the European debate. However, now that we are in a state of economic, financial and moral crisis, it is not the best time for this from the perspective of citizens.

There is a lot depending on the Irish Presidency. Having had the opportunity to meet the Tánaiste and the Minister with responsibility for European integration, who has been an active partner of this committee, I am convinced Ireland has a very challenging programme for the Irish Presidency and I look forward to it achieving a good result. I come from a medium sized country, Hungary, where we had a woman dealing with the issues during Hungary's Presidency, so I hope the Minister of State, Deputy Lucinda Creighton, will do a very good job with the committee's co-operation.

Mr. Ashley Fox:

I thank the Chair and the committee for welcoming us here today. I am a British Conservative who represents the south west of England and Gibraltar. Like the Chair, I find there is a great decline in trust of the European Union and the EU institutions among my constituents. I am quite sure this is due to the incompetence with which they have dealt with this crisis. Like Deputy Durkan, I accept that Ireland has been very badly used by the eurozone. Ireland seems to be picking up much of the bill for many of the other countries.

I am glad the United Kingdom is not part of the eurozone, but I wish Ireland and the rest of the eurozone well in fixing their problems. However, I think the fundamental problem is that the eurozone has 17 economies and one interest rate. Committee members should ask themselves the simple question: "Why did Ireland and Spain have a massive property boom that has ended in a crash?" The answer is quite simple. Interest rates were too low for too long. This is exactly what happened in the UK in the late 1980s.

The trouble is that even if with much effort and suffering Ireland gets through this crisis, it will be left in a situation where the Irish economy has an interest rate determined from Frankfurt that will never be determined in accordance with Ireland's interests. How is Ireland to solve that problem? I am not sure it can, because if the eurozone has one interest rate, that rate will always be just an average. In fact, it will probably be set with a view to what is best for the big countries, France and Germany. I see no easy way out of that. In ten, 20 or 30 years time, irrespective of whether Ireland chooses to join the federation of European states or whatever proposal Mr. Barroso has in mind, it will still be left with the problem of what to do when monetary policy is dealt with somewhere else.

Ireland dealt with this problem previously, at a time when it was in monetary union with the United Kingdom as an independent country. It solved the problem by issuing its own currency and having its own interest rate. I wonder if that is the solution to the problem Ireland now faces, but I am sure it is not popular among the political establishment.

I was surprised to find myself in agreement with almost everything Deputy Crowe said. I suspect we come from slightly different political traditions.

Seán Crowe (Dublin South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

That is the end of my career.

Mr. Ashley Fox:

I would like to respond to a number of the specific questions raised by the Deputy. Referendums are very good because they ensure political acceptance by the people. Members of the committee may be aware that in the United Kingdom we have passed an Act of parliament that puts us in a similar position to the Republic of Ireland. If a transfer of power from Westminster to Brussels is proposed, there has to be a referendum.

Deputy Crowe asked whether a banking or fiscal union would necessitate a referendum in other countries. One certainly would be required in the United Kingdom if we tried to join such a union, but I assure the committee that we will not try to do so. Yesterday we received information in evidence from senior counsel to the effect that a referendum would more likely than not be required in Ireland. I would be interested to know what the outcome of such a vote in Ireland would be in the absence of relief on the enormous burden it has been left with for bailing out French and German banks. The Deputy has also asked whether the atmosphere in which European affairs are being conducted is conducive to greater political union. It is almost certainly not.

Deputy Keaveney mentioned the rise of Golden Dawn in Greece. My view is that Golden Dawn is becoming more powerful because the people of Greece have realised that it does not matter who they vote for because decisions are being taken in Brussels and Berlin. The trouble is that when people come to the conclusion that it does not make a difference which party they vote for, they tend to the extremes. There is a danger for Ireland in this regard. If it does not matter whether there is a change of Government - if the country is still laden with debt and its economic policies are still decided in Brussels - people will wonder what the point of voting is. That is a problem across the whole of the European Union.

I was asked to outline my view of the political future. I am quite sure France, Germany and others will forge ahead with a political union. I hope Britain remains in the European Union, but I do not want it to be part of any sort of federation. I know my constituents are pleased to be part of a Single Market, but they do not want to be part of a country called Europe. I would be interested to know how the Irish representatives here view that thought. Do they want to cede greater sovereignty to Brussels? Do they look forward to decisions on budgets, taxes, spending and borrowing being made somewhere else? It would be interesting to hear their views.

Mr. Gerald Hafner:

We live in a time of shared sovereignty. It is not enough for one to be a citizen of Dublin, Galway, Munich or anywhere else, to be a citizen of Ireland or, in my case, Bavaria and Germany. At the same time, we are citizens of Europe. We desperately need an open discussion about what should be dealt with and on which level. We are stumbling into decisions and saying we need new competences. There is no concise discourse about which question should be dealt with an on which level. We need such a discourse. I do not think the debate for or against the European Union makes sense. We need a debate on where we want or need more European decisions to be made and on where it is better to have stronger and greater sovereignty at a lower regional or state level.

We have to be more honest about the crisis than we sometimes are. I do not think the crisis fell down from Heaven. It resulted from a certain political approach and certain policies. The Lisbon strategy, for example, was underpinned by the idea that we needed to regulate many things in Europe, but that we should not start to regulate the financial markets because they would not work in such circumstances. The lesson we have to learn is that the exact opposite is the case. If we do not have clear regulations on financial markets and banks, etc., the common currency will not work. A currency is an important instrument in keeping an economic balance. If one does not manage to do this, one can ultimately devalue it or work with it in some other way. If one does not have this instrument anymore, economic imbalances will lead to terrific situations like the current one in Europe. In such a situation it is simple to call for money and say, "Let us pay for the debts" and "Let us help each other." We have to help each other. We need much more solidarity in Europe. At the same time, the most important form of solidarity needed involves going to the roots of the crisis and changing the laws and regulations. We cannot keep huge parts of the current laws and regulations while simply paying for the debts. The payments we are making will never reach the Greek citizens and those who are really suffering. By imposing austerity measures on workers and ordinary people, while paying for the banks, we are paying to keep interest rates affordable. All the money we are paying is being given to those who have so much money that they can lend it to the state. We have a crisis in the sense of there being a debt problem, but at the same time, we have the problems associated with too many assets or too much money being used in a speculative way. If we do not come out of that bubble, it will grow and grow. We have to discuss how the European Union can come out of that bubble. We are at the beginning of that discussion.

I am afraid that the way European decisions have been discussed, taken and introduced in recent years will lead to a terrible loss of democracy if it is allowed to continue. That loss of democracy will lead citizens to lose faith and trust in European decision-making. Citizens in the 21st century do not see themselves as mere spectators when political decisions are being made. They see themselves as sovereigns and want to share decisions. As previous speakers said, people do not like to be told that there is only one road to be followed, that there is no alternative and that they have to accept what others do on their behalf. They want to see different possibilities and have a say on which path should be followed. However, that is not the situation we are in at European level.

I agree with those who suggest there is a huge fear in the European Parliament and, to a greater extent, the Commission and the Council about referendums in Ireland and other countries in which referendums on treaty changes are needed. As some members of the committee and some of my colleagues said, a referendum is an important instrument to allow citizens to share in decisions. The solution is not to forget about referendums but to come to better proposals and political decisions and organise the debate better that we desperately need in Europe about the future of the Union.

What is now discussed, for example, by the Van Rompuy paper on the proposals of the four presidents - of the Commission, the Council, the Central Bank and the eurozone - is a whole range of new competences and institutions. We need a European discourse on that. Whether we share the proposals or not we must all be in the same boat when it comes to European democracy and decision making. Perhaps the most important thing that must happen in the coming years is for a new European convention to deal with those questions. Members might recall that in the previous European convention the question of which issues should be dealt with on which level was excluded because the working group did not finish its work. In the end it was told that there was not enough time and that we would come back to it another time. Many other details could not be concluded either because the convention did not have enough time. We have such different legal and constitutional backgrounds in Europe and different understandings, especially on financial, economic and monetary policy, that we need a discourse on them and not just to have fast-track decisions, as is the case currently, that may lead us to extinguishing the fire, but not to a stable architecture of a democratic union.

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank Mr. Hafner. If any of my colleagues wish to respond to what has been said before I go to Mr. Casini, they may do so.

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The discussion illustrates beyond any shadow of doubt what the real problems are in Europe. Nobody has decided on a co-ordinated approach. We are not all travelling in the one direction at the one time with the same objective in mind.

In response to what Mr. Fox said about low interest rates being the cause of our problems, I wish to point out that low interest rates apply worldwide, in the United States as well, where they are even lower than in Europe. That is not the cause of our problems. The theory that has been put forward in the past that no member state could have any influence on monetary or fiscal policy within the European Union because interest rates were fixed from Brussels, is wrong. Nothing ever prohibited individual governments or governments within the Union acting together from deciding to introduce credit restrictions. We were supposed to have credit restrictions, governed by the governance system put in place at European Central Bank level. What Deputy Crowe said is not entirely true in the sense that while we did contribute to our problems they were under the aegis and supervision of our own institutions that should have known better but did not. We are prepared to shoulder the burden. We accept that we must pay the price but we must know as well that all other European countries are pointing in the same direction and that they intend to do the same thing. I totally reject the notion that a multiplicity of currencies throughout the European Union is of any benefit to anyone. The only thing that would do is create opportunities for speculative adventure that has been shown to be hugely costly in the past. I apologise as I must go to the House to attend to another matter. I am sorry that I have to leave.

Seán Crowe (Dublin South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Getting the architecture right is the key. We must get it right in terms of the direction in which we go. We must examine structures to ensure that we will not be left in this situation for another ten years or that another crisis will occur in 20 years’ time. Urgency is required because of the difficulties that were outlined at the meeting such as what is happening in Greece, the 52% youth unemployment rate in Spain and the fact that another generation of our best and brightest is leaving our shores.

At the same time our European leaders seem to be helpless because of the views of a minority within Europe on the steps that are required to resolve the problem. Due to a possible election in another country we will not get any change in that regard. At the same time health care is being cut, people cannot get vital operations or medical care and cuts are being made to the number of special needs teachers in schools. There is a social cost to the prevarication of a minority of leaders within Europe. The other leaders are stunned into silence. I do not know whether they have a voice on Europe because if they do, they are very quiet on what is happening across the European Union.

We have clear choices about the direction in which we will go. One could ask whether we will choose more of the same. If we do, there will be social revolt right across Europe. The instability we have seen in Greece will be mirrored in other countries. There is an urgent need for a response to what is happening in Europe. This country is among those that are suffering and people cannot take much more. We must tackle the structure of the European Union but there is an urgent need for political leaders to take control. They have failed us up to now. It is their responsibility to come up with a resolution to the crisis in Europe.

Colm Keaveney (Galway East, Labour)
Link to this: Individually | In context | Oireachtas source

I agree with Deputy Durkan in the sense that it is as a consequence of a previous Government’s ineptitude, fiscal mismanagement and a weakness of democracy in this country that the debts of private banks were socialised into a sovereign debt with a significant amount of arm-twisting from the European institutions who forced this debt onto the shoulders of ordinary Irish people.

It is worth considering what the consequences would have been for the broader European banking system if we had not guaranteed the gambling debts of private banks. There is no doubt that we are culpable to a certain extent for the current domestic financial crisis but there is also no doubt that our arm was twisted on a night in September in the Department of Finance by officials in Europe, in particular from the European Central Bank, to prevent contagion across the Union. We got a unique response from Europe and a special response from the ECB. That leads to an expectation that what happened would be acknowledged. We should not have taken on the debts of some of those private banks, in particular Anglo Irish Bank, which was not systemic to the economy. It was an exclusive bank that meant nothing to ordinary people and the ECB essentially forced us to enter an arrangement that would cost the Exchequer somewhere in the region of €80 billion. We are culpable to the extent that we let it happen and we did not revolt or resist. We did not organise against it. The decision was done and dusted.

The agreement was made behind closed doors, without the consent of Irish people. The Parliament was forced to give a sovereign guarantee to private bank gamblers who gambled with the futures of young Irish people and their hopes for a sustainable existence within this country. That is the problem and I am sure it is replicated across the community, particularly on the periphery. This money came from somewhere, most likely from German and French banks, as a speaker noted. Essentially, we have taken a liability in order to secure the future viability of German and French financial institutions.

Mr. Carlo Casini:

The Lisbon treaty starts by defining itself as one stage of a process. Article 1 of the treaty states that it is the first stage of many in the process of European integration. The problem is defining what the next stages will be. The main problem is to define exactly what we mean regarding the goal we are trying to reach. The view of most of the European Parliament is not in line with what Mr. Fox sees as being the goal of the European Union. I believe most people are leaning towards more union, real union, and more rather than less Europe.

I realise the most urgent problem at the moment is resolving the economic crisis. As Mr. Hafner said, when one's house is on fire, what one needs are firefighters. However, I do not have, nor do I believe anybody else has, a fixed solution to the problem or a preset recipe for solving it. If we did have these and did not use them, obviously that would be criminal. None of the parties, however, either on the left or the right, has a clear-cut solution as to how to solve the problem. All I can do is set out some elements of comment which I believe are worth considering.

First, I do not believe the European Union caused the crisis. It started outside the Union, in the United States. The EU suffered contagion from the banking crisis in the US and we are now trying to combat it. However, the existence of the European Union was not what caused the crisis in the first place. Second, what is certain is that one of the main results of the existence of the EU has been peace. It has been a huge success. Not only is there peace in Europe but the notion of any conflict between our countries is now utterly unthinkable.

There has never been a similar case to this one in all of history. There have been unions of individual countries or empires but these have always come about through constraint or violence. As far as I am aware, there has never been a stage in history when states have got together around the table to discuss matters and talk about the interests of their region. Some people would say that now we have reached the goal of peace the process can come to an end. What we must remember, however, is that the world of today is increasingly globalised; it is not the same as the world of the past. People can travel and move around and there are telecommunications. Think about the enormous economic growth we have seen in countries such as China, India and Brazil, which are now the emerging countries. No country on its own can guarantee prosperity, progress and solidarity for its citizens. Think about the countries to which I just referred and compare their cost of labour to that of countries in Europe. Europe cannot compete with that. No country on its own is able to resist or compete with other countries that have a more or less similar economic model to that of Europe.

I think that solidarity has quite rightly been invoked this afternoon. We need wealthier states to show solidarity towards poorer states and to have solidarity within a country to ensure wealth is correctly shared. We also need solidarity towards our future generations. We cannot pay our debts now at the cost of future generations. We need budgetary discipline to ensure solidarity with the future and not simply be selfishly focusing on today’s generations.

Obviously, we are not going to find a solution to all of these issues today. All we can hope for at the moment is to get to know one another better to discuss matters and hope for future meetings. We should not let mistrust in the European Union win the day. When one thinks of when the Jews left Egypt and crossed the desert, they knew the desert represented the difficult period they had to go through but that through their efforts they would reach the Promised Land. Perhaps Europe is experiencing its time in the desert. However, we cannot lose sight of the ultimate goal that Europe can show the world that its idea of peace, equality, justice and democracy can win through.

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank Mr. Casini and his colleagues for their contribution to our committee meeting today. I understand Mr. Casini will be travelling home after this engagement. I hope his journey here today has been useful and wish all the delegation a safe journey home.