A year ago, the European Union reached its Hamiltonian moment. The sense of human solidarity in the face of death and the pandemic had pushed European leaders to make unprecedented choices. The heart attack suffered by the economy resulted in a surge in solidarity. To manifest it, European fiscal rules constraining national welfare expenditures were suspended and a sizable and shared financial facility was established through common debt.
The aim was not only to help the most affected countries to overcome the health and economic crisis, but to create structural convergence among all countries. An economically more homogeneous European Union would be more homogeneous politically as well. As a result, the sharing of common resources and the new political harmony would write a new page in European history.
A year later, the European economies are recovering faster than expected. The recession has left behind very high debts, but the sense of emergency is less felt, and Hamilton's spirit is in danger of waning. Next September, the European Union will start debating how to change the rules that regulate its economy. Eventually, the EU institutions and the 27 governments will have to agree on how largely they will use fiscal policies, if they need to pool resources together and share their allocation, or if monetary and fiscal stability are more important than temporary unemployment or chronically low investments. The decision will have an impact well beyond the convergence of the economy. In fact, all political objectives of the European Union – environmental policies, external and internal security, among others – will be affected by decisions on how the money will be spent and how strong the economy will be able to grow. The vision of the future of Europe depends on the design of those new rules, and leaving it only to financial priorities would be a historical mistake.
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