Reporting the Commission is least negligent

Spring 2010 ended in Europe under the weight of heavy threats which faced the euro, which the future was seriously challenged by many. Indeed, pessimism maintained by the financial press and markets have been a few rationales both the process leading to an agreement has been chaotic and disastrous communication. But these reactions were disproportionate, they led to a kind of blindness on the scope of decisions finally taken and we will see the effects this quarter.

This crisis has forced Governments to recognize the governance of EMU design flaws and they have responded to this challenge. Yes, a new architecture is set up for the euro area. It will be based on a more strict application of monitored more budgetary disciplines close by markets and European mechanisms of prevention and crisis management.

The first point on which progress, it is the quality of statistical information and the financial "reporting". If the Greece could move up to a financial situation also degraded, it is first due to the opacity and the lie. You should know that the powers of control of Eurostat's national accounts of public administrations have been atrophied because major countries, including the France, refused to increase these powers fear thus strengthen the European institutions. The new regulation improves things by significantly increasing the powers of investigation of Eurostat, is the crisis which led to progress in this direction and should be to not stop along the way.

"Reporting", the Commission is least negligent. It might be useful to create an independent body of multilateral surveillance. One can think in this spirit to a Committee of wise men, as in Germany or a bi-partisan Parliamentary Budget Office taking model on the U.S. CBO with a stronger mandate. The latter would have the merit to include Parliament in the discussions of economic policy. In any case, it is a theme on which it is important that the Commission Van Rompuy makes proposals to the Council.

Based on sound financial information, the application of the rules and procedures will have better chances to test credibly budget paths and correct shooting in anticipation. The fiscal Outlook might, as has been proposed, dealing with traffic lights, green, orange or red. Properly informed by a convergence of opinion and of public and private notations, financial markets will do their job. "Spreads" observed at each program - which have been much too inert in the past - can, as we know now, reach levels discouraging fiscal policies too adventurous. This will be the way to internalize the financial commitments by each national Parliament, to which the country agreed with its partners.

Going beyond very, many German officials have circulated the idea of "penalty" for offenders, but it is a political stalemate. The Word does not even belong to the vocabulary of the yet expert IMF budgetary discipline. In a democratic country, a citizen in bankruptcy does not lose his political rights. It would be lost to go that route. On the other hand, one can imagine, like the IMF programs, a kind of conditionality that constrain the disbursement of funds of the Union for seriously failing countries.

The crisis is not over and the European authorities must at the same time create this more stable financial architecture and to consolidate the recovery. The decisions already taken and those that Van Rompuy commission will present to the Council are a step forward very positive for the euro area, it might well discover in a few months, unlike the whining of the spring, it is the area "the best managed in the world."