by Henry Farrell on May 20, 2010

getting interesting …

Wolfgang Schäuble in the “Financial Times”:

bq. Indeed, far from reflecting a growing German Euroscepticism, Mr Schäuble and Ms Merkel have both revived calls for closer political union to underpin economic and monetary union. “When we introduced the euro in the 1990s, Germany wanted a political union and France did not. That is why we have an economic union without a political union,” he says. “Political union naturally means a bit of federalism in the German sense of federal. It means that one can no longer take certain decisions on a national level. That is very hard for the UK. It’s often not so simple for France, but France finds it easier to take European decisions.

bq. “Germany has a lot of experience with federalism, more than the UK or France. If you want to create a federal organisation, you must be ready to have a certain amount of redistribution within it. You can dismiss that by rudely calling it a “transfer union”. But strong and weaker states both have their responsibility. We are asking a lot of the weaker ones, but the strong also have their responsibility, and we must explain that as well.

bq. “We must say very clearly to Germany: we can play our role, but we must know that means there will be decisions taken against us. The weekend before last [in the negotiations over the eurozone stabilisation mechanism], we saw that it was not in the German interest to be standing alone. That is also a good learning process for the German public.”