Chapter 2: Economic and Monetary Union in Europe: Political Priority versus Economic Integration?
Otmar Issing1 INTRODUCTION 1. The Hellenistic poet Moschus called Europe the ‘other continent’, the destination of the ﬂeeing bull with the Princess of Tyros on its back. This idyllic image marks the birth of Europe as an ideal. We are now moving into a new millennium in which Europe will witness further integration and aspire to progress and greater prosperity. Will the future be a continuation of current trends? The recently established Economic and Monetary Union (EMU) marks a crowning step in the process of economic integration in Europe. This is a milestone and will, at the same time, be a catalyst for some form of political integration for two reasons. First, the introduction of the euro will subject the institutional arrangements of the current 12 participating member states to many new tests. Second, political forces are preparing for the enlargement of the European Union, with many states wishing to accede. Hence, the future will not be just a continuation of current trends. In this chapter I intend to expound my views on the relationship between political, economic and monetary integration in Europe (the ‘triangle’) or, to put it slightly diﬀerently, the links between the state, the market and the currency. This triangle is fascinating, but also complex, and has many implications. Europe as an ideal was always, ﬁrst and foremost, a political project driven by political decisions. However, following early setbacks on the political front, the focus turned to economic, and then to currency, matters. After World War...
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