The State of the European Union. The European Parliament faces its most important elections yet

THE STATE OF THE EUROPEAN UNION 64 crease until funding were completely independ- ent from the member states. Then the European Commission would have true power – and it would be a truly European power. On the other hand, the current EU budget, which amounts to a little over 1% of combined GDP, is ridiculously low if we are talking about European policies in a federal sense. It is abso- lutely insufficient to implement a European so- cial policy with a guarantee of, for example, un- employment insurance or a minimum monthly wage, which would have a huge impact on the public perception of the Union’s usefulness, or of major (and countercyclical) investment in infra- structure or in R&D+I, or to promote a true eco- nomic and social convergence among member states, a prerequisite for unity. To give us an idea, a quite decentralised federal country, such as the United States, allocates 16% of GDP to the fed- eral government (though 20% of that amount goes on defence). Piketty’s manifesto speaks of a European budget of 4%, while the Spinelli Group mentions the MacDougall Report, which already predicted in 1977 that the EMU would require a budget of 5% of GDP. That seems to be a reasonable percentage for a federal Europe, at least while it does not have competences in defence. Naturally, it should be considered a goal to reach gradually, yet we must be aware that with a 1% budget speaking of federalism is an act of irony. A European Parliament elected in a single European vote, with similar competences to those of any national parliament, controlling a European Commission formed according to ma- jority political criteria, entirely independent of the member states and provided with an au- tonomous and sufficient budget, would be a solid foundation for a European Federal Union and would be tremendously effective in resolv- ing the common problems of European citizens that have to be addressed at that level, without harming the competences that fall to the states, regions, or cities, according to the principle of subsidiarity. While we believe that what we have just de- scribed is the keystone of the political architec- ture that would bring about a federal union, in the light of experience there are other reforms that have to be addressed to make the EU more effective and closer to citizens, among which we might mention, without any intention of be- ing exhaustive: – Drawing up a new statute for the ECB so that it is responsible not only for monetary stability but also for promoting growth and employ- ment and is the official lender of last resort. – Completing the EMU to create a common economic and fiscal policy, including, among other things, the creation of a European Monetary Fund (on the foundations of the ESM), a European ratings agency, a vice-pres- ident of fiscal affairs in the European Commission (and president of the Ecofin and the Eurogroup) with a European treasury (ini- tially for the eurozone) that can finance itself with Eurobonds, giving official status to the Eurogroup and completing banking union with a European deposit guarantee fund, as well as incorporating intergovernmental agreements, such as the fiscal compact, into the Community acquis once and for all. – Reinforcing the Court of Justice of the EU’s capacity to act as a Constitutional Court, giv- ing it the capacity to settle conflicts of compe- tences between European institutions, includ- ing the European Council, and to take action against violations of the rule of law and the values gathered in Article 2 of the TEU. – Specifying the future scope of Article 42 of the TEU relating to the common security and defence policy and opening the door to the