Euro would still be strong if it had been built to my plan
by Jacques Delors
To use that British understatement that Continentals enjoy, one might suggest that it has not been a good year for the euro. And now, some say, only about a week remains to put things right. So who better to question than the man who invented it? In Paris on Wednesday, I called on Jacques Delors.
Mr Delors, who was President of the European Commission from 1985 to 1995, is the only foreign bureaucrat ever to have become a household name in Britain. In 1988, he enraged Margaret Thatcher by coming to address the British TUC on the joys of the European “social dimension”. Her famous Bruges speech later that month was her attempt to stand against the tide of European integration that he represented.
It was Mr Delors whose report produced the plan for what we now call the euro. He was such a demon figure for British eurosceptics that The Sun produced the headline “UP YOURS, DELORS” and invited its readers to turn, face the English Channel and make a rude gesture at him in unison.
I climb several twists of typical steep Parisian stairs to a modest office. The small, bespectacled figure who greets me is old in years — he was born in July 1925, three months before Mrs Thatcher — but with undiminished physical and mental vigour. We talk for two hours, and one feels he would happily continue for another two.
Mr Delors is known for his austerity, but the man I converse with is not stiff or pompous. He remembers his old adversary with a slightly amused respect, noting her immense capacity for work and her vision in looking for change in the Soviet Union before others did.
He reflects on their difference of background and character: “I think for Mme Thatcher I was a curious personage: a Frenchman, a Catholic, an intellectual, a socialist.”
Deciding not to beat about the bush, I ask the man who prides himself on being an architect of European Union whether he got it all wrong. Unhesitatingly, he denies it. It is a fault in the execution, not of the architects, which he claimed to have pointed out in 1997 when the plans for introducing the euro finally came together. At the time, he says, the best of the eurosceptic economists, whom he refers to as “the Anglo-Saxons”, raised the simple objection that if you have an independent central bank, you must also have a state.
Mr Delors thinks “they had a point”, but the way round this problem was to insist on the economic bit of the union as much as the monetary. As well as creating a single currency, you also had to create common economic policies “founded on the co-operation of the member states”.
I get the impression from Mr Delors that he thinks Mrs Thatcher would have agreed with this view. She certainly would not have agreed, however, on the Delors version of what that co-operation should produce — the harmonisation of most taxes, plans to deal with youth and long-term unemployment, and that social dimension for which he always called because “it is not just a question of money. I said all these things, but I was not heard. I was beaten.”
There was also a problem of “surveillance”. The Council of Ministers should have made it its business to police the eurozone economies and make sure that the member states really were following the criteria of economic convergence. This did not happen.
For a long time, the euro did remarkably well, Mr Delors argues, bringing growth, reform and price stability to the weaker members as well as the stronger. But there was a reluctance to address any of the problems. “The finance ministers did not want to see anything disagreeable which they would be forced to deal with.” Then the global credit crisis struck, and all the defects were exposed.