«Ladies and Gentlemen, good afternoon.
It is a pleasure and a great honour to stand before you here today and accept your Doctor Honoris Causa. I have long had a deep affection for Greece and its people, with their unparalleled history. More recently, I have been personally, and still am, at the forefront of the collective effort to help this proud nation emerge from a crisis that has lasted far too long. And I am confident that Greece is closer than ever to turning the page on this difficult chapter, to emerging with a stronger and more stable economy, and with its place confirmed in the eurozone and the European Union.
But today, here at the oldest university of the modern Greek state, I want to speak to you much more broadly about our shared European future. Because, as we prepare to mark the sixtieth anniversary of the Treaty of Rome, the European Union faces unprecedented challenges.
I was born the same year as that Treaty was signed – I will not ask you to comment on which of us has aged better! My generation is the first in Western Europe not to have lived through the devastation of war, or the cruelty of undemocratic regimes. My mother and father – both Jewish, one born in France of Polish parents, one born in Romania – knew those things first hand. For me, those times are memories conveyed to me by my parents.
Of course, for Greeks, and even more so for citizens of our newer Member States, the transition or return to democracy after years of dictatorship and totalitarianism is more recent. But for anyone turning 18 today in any of our countries, the only Europe they have known is one of freedom, democracy and open borders. That is of course a happy thing – but it also presents us with a challenge, because the counterfactual of a Europe without the European Union is for them abstract and intangible. Many young people in the south of our continent have also come to associate Europe with the economic crisis and the huge levels of unemployment we have seen in recent years. For them, the European ideal has failed, and they see austerity as a very heavy price to pay for being in the euro. And the populists know that very well.
Europe‘s political and economic landscape has changed immeasurably. The UK referendum and the US election have shaken our preconceptions about politics in the Western world. Brexit and the presidency of Donald Trump are two major challenges: we need to build a strong response to those who dream of a divided or weakened Europe, and this response is our unity. These were two major electoral upsets – and there are many more unpredictable appointments with the ballot box in the next ten months: in the Netherlands, France and Germany, to name but a few. And yet there may also be an opportunity for voters to take a bold, positive step towards a bright future of peace, if, as I hope, an agreement can be reached in Cyprus and put to the people for their endorsement. Think what a wonderful and inspiring counter-example that could be, the year following the Brexit vote. Of course, we are not there yet.
I would like to talk to you today about how I interpret, and how to respond, to the populist tsunami that is rumbling across the West.
[First, how do we interpret the populist wave?]
The achievements of the past half-century are under threat as never before. Not only the achievements of European integration, but those of the international trading and security architecture, to which we owe our unprecedented peace and prosperity. But what is driving this backlash? The fact is that a growing part of our populations consider themselves the losers of globalisation. They feel they are at a dead-end economically, socially and thus politically. They have lost trust in the existing systems, and are seeking new ways to express their frustrations, and new leaders who they hope will champion their interests. They want radical change, and they do not believe it can come from an establishment they see as detached from reality, geographically and socially distant from them, and indifferent to inequality.
[So how do we respond to this wave?]
There are of course many facets to this situation, many specific national or local aspects within the international trend. There is no one-size-fits-all response, and no silver bullet that can burst the populists’ bubble. I certainly do not have all the answers, but I do have several ideas for how the European Union, and the eurozone in particular, can respond to this challenge.
2016 was the year that called our certainty into question, and is likely to be remembered as the year when Europe was hit by Brexit. Some would add that 2016 also marked our entry into a post-factual world.
What I know is that 2017 cannot be the year that Europe stood still. Instead, it must be the year in which pro-European parties begin to join forces. Because we have little time to ensure that what President Juncker has called the «last chance Commission» does not become simply «the last Commission».
My message today therefore is clear: we need to respond to Europe’s challenges and the demands of our citizens. We need to fight the populists and euroscepticism with vigour and with ideas.
My vision is simple: some might regret it, those who dreamed with Victor Hugo of «United States of Europe», but Europeans are not ready for a federal leap forward. They want nations to be respected and closely involved in the design of the European project. A federation of nation states, as Jacques Delors said, remains the most relevant and dynamic concept to shape our common future.
My ambition is strong: we must build a more political Europe, with a strong eurozone at its heart.
Following the UK referendum, I spent my summer writing a book to develop this concept. If we want a more political Europe, we need three things: a Europe that better protects its citizens; a Europe that is both more political and more democratic; and a Europe that delivers real economic dynamism.
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[Our first response: A Europe that protects]
Europe needs to be able to prove to all parts of its population that it is still able to offer them protection. And by that I do not mean a protectionist Europe – protectionism is a danger, not a solution – I believe in a Europe that has the capacity to make globalisation work for those that currently see it as their enemy.
We need to ensure that our competition policy is applied in a way that facilitates the creation of European «champions», able to compete and win global market share.
We also need to modernise our trade policy, by strengthening our defence instruments and by integrating fiscal dumping into our negotiations. And of course, we must be vigilant about future trade policy moves by the new US administration.
We also need to learn to think «European» in terms of security, both internal and external. Defence spending must be a shared burden. Terrorists threaten European lives, European values, and European cities. This requires a collective response.
And as Greece knows very well, Europe must show that it is able to protect not only its own people, but also those fleeing from war and persecution. There is no contradiction between keeping an open mind and heart for those fleeing persecution elsewhere, and the need to secure our external borders, which is a key condition for Europeans to accept the absence of internal borders. We must always remember that European values are those of open societies and open economies: while some want to build walls, we must build bridges – human, cultural, economical bridges.
[Our second response: A more political and more democratic Europe]
There is no single institutional answer to delivering a more democratically legitimate Europe. I know the European institutions better than most: I have twice been a member of the Council of Ministers, twice a member of the European Parliament, and now since 2014 a member of the European Commission. I know their strengths. But I also recognise their shortcomings, and I know that the inefficiencies and complexities of the current situation are a key driver of the urge to “take back control». Nation states are portrayed as the only political vehicle able to provide efficient action, democratic acceptability and control of one’s own destiny. This is a mirage: but it is a politically bankable one. So we have to find a way to strengthen the political contract – and the political contact – between Europe and its citizens.
Above all, for voters to see the EU as legitimate, they must see it as a problem-solver rather than a problem-maker or a problem-amplifier. To bridge the gulf between EU citizens and the EU institutions, we need governments to overcome the temptation to support decisions in Brussels only to attack them when they get home. Inconsistency of this sort undermines trust, not only in the EU institutions, but also in the politicians who pass such messages, further fuelling popular disdain.
And we need to forge a stronger link between voters and those who represent them in Europe. The European Parliament and the Commission can both strengthen their legitimacy by investing further in the Spitzenkandidaten idea, whereby each pan-European political party nominates a candidate to be President of the Commission. I would also support the idea of strengthening the European Parliament’s role of supervisor and democratic monitor, including when it comes to economic governance of the eurozone. At the same time, I believe that there is more that can be done to strengthen the role of national parliaments in European policymaking.
[Our third response: A more economically dynamic Europe]
But we will never be able to take on the populist movements in Europe until we reverse the austerity trend and the divergence among eurozone economies that has defined the past six or seven years. We need to deliver a stronger recovery whose fruits are shared more equally, not only between countries but also within countries and societies.
It is my sincere hope that Greece can be the first country to implement such an economic strategy.
We need to act on several levels. We need a relentless focus on human capital and productivity. That means structural reforms to improve the level of education and training for all of our citizens, from early schooling to lifelong learning. That is one of the most concrete ways in which we can fight inequality.
We need to do more to close the enormous investment gap that is one of the lasting legacies of the crisis. We have made a start with the Investment Plan for Europe, through which financing agreements signed as of January 2017 have the potential to trigger almost 170 billion in additional investments.
And we need to continue fighting for fair taxation. Having had to tighten their own belts – and nowhere more than here in Greece – Europeans have no indulgence for those who do not pay their fair share of taxes. Our goal is clear: multinationals must pay their appropriate share of taxes where they create profits. We are moving in that direction. I am proud to say this European Commission has done more in the last two years to promote fair and transparent taxation than has been achieved in the previous two decades. But we have much work still to do.
[Strengthening the eurozone]
Above all, we need to press on with the unfinished business of completing the Economic and Monetary Union.
The eurozone must become the beating heart of the new Europe that will emerge from the upcoming separation with the UK. And for that to happen, the eurozone needs to show that integration is not the problem, but the solution. The eurozone needs to deliver prosperity for all of its Member States, and all sections of society. This is for Greece, and for the Greek people. I have dedicated much of my efforts in recent years to avoiding Grexit: this would have damaged the integrity and even the «raison d’être» – the meaning – of the euro. This is no longer a threat. Now, in the days to come, we must pave the way for a success story: a strong Greece, recovering growth and confidence, creating jobs, attracting investment, at the heart of a reinforced eurozone.
The European Union will survive Brexit – but its long-term health depends on us being able to strengthen the eurozone. That’s why we have to continue working on the future of our single currency. The European Commission will set out proposals on the future of the EU at 27 in a white paper which we will publish next month, including ambitious ideas for the deepening of the economic and monetary union.
My own views on what is needed are firmly held: completing the institutional and political architecture of the euro area implies in particular providing it with a real budget and creating a eurozone minister of finance, accountable to the European Parliament. But those are longer-term goals.
In the short term, we need to tackle the profound divergences that exist in our currency union and learn to act in the common interest.
* * *
Ladies and gentlemen, the coming year will be one of political transition in Europe – but it must not be a year of paralysis!
The achievements of the past half-century are under threat as never before. While we do not yet know the details of the policies the Trump administration will pursue, we do know that their instincts will be protectionist and nationalist, and that their leitmotiv will be «America First». That means that the international trading and security architecture, to which we owe our unprecedented peace and prosperity, is threatened as never before.
So let us mobilise. Let us ensure that 2017 is the year in which we stand up and fight for the united Europe that we continue to believe in and that more than ever, we need. A Europe that is not only dynamic and competitive but also inclusive, social, fair. A Europe that stands tall and strong on the international stage, proud of its values of openness and tolerance. In that sense, we must see the Trump administration not only as a challenge, but as an opportunity.
In this moment, more than ever, Europe needs the firmness of those with vision to mobilise resources and take this project forward.
I will be pushing for that, and more broadly for a more positive narrative on Europe, and against populist lies, not only in my home country but also beyond, in the coming months. The honour you give me today will remain an invaluable encouragement to do so in the future.
Thank you for your time and attention».