The euro crisis has fundamentally divided Europe between creditor and debtor states, between eurozone countries and the rest. Even within member states divisions run deep. Trust is low, the economics flawed, and the politics toxic. Recovery has been modest at best; it also remains fragile and uneven - with high unemployment, unhealthy public and private debt, and the growth of populist Eurosceptic parties. The EU seems to be facing the future on a wing and a prayer. In this Policy Network pamphlet, Loukas Tsoukalis presents the case for a new grand bargain to rescue the European project. Written by an author who uniquely bridges the gap between academic analysis, policy and politics, the publication presents a critical overview of where the EU stands on the eve of its crucial parliamentary elections, how it got there and what is to be done to turn around the unhappy and precarious state of the Union.
Published by Policy Network in partnership with 5 other major European thinktanks: Notre Europe (France), Bertelsmann Stiftung (Germany), ELIAMEP (Greece), Istituto Affari Internazionali (Italy) and Elcano Royal Institute (Spain).
Translated versions will be disseminated in all six languages. Italian version of the Executive Summary published in Documenti IAI 14|03 and AffarInternazionali, 30 March 2014. The volume has been presented at a conference organised in Rome on 30 June 2014 in the framework of the series "The future of the European economy".
The state we are in
B. Before the Crisis
Bigger, more intrusive and less inclusive
Was the euro a terrible mistake?
C. (Mis)managing the Crisis
Who pays the bill?
Buying time at high cost
Successful, but slow to lead
Beyond the equilibrium of terror
D. A New Grand Bargain
Growth and cohesion
Governance and democracy
Beating the odds?
E. End notes