Off the Target : The Stagnating Political Economy of Europe and Post-Pandemic Recovery

This book describes the history of European integration and the Eurozone, before presenting ways in which the European Union can move forward. Charting integration from before the Second World War, the foundations of the Eurozone are examined to provide insight into the challenges faced by the European Union, including the Global Financial Crisis, over recent decades. The impact of TARGET2 and the European Monetary System are also discussed. This book aims to highlight ways that current challenges to European integration, such as the COVID-19 crisis, environmental degradation, and fiscal debt, can be overcome to promote economic growth and social advancement. It will be relevant to students, researchers, and policymakers interested in the political economy and European economic policy. Preface Contents List of Figures List of Tables 1 Wrong Intentions and Flawed Foundations European Identity and Integration in European Blood From Fall of the Berlin to the Rubble of Berlin Wall German Unification and Road to Maastricht Maastricht Treaty—Conception of Tragedy Maastricht to Amsterdam Politics and Economics of Convergence Euro—The Birth of Tragedy 2 Great Moderation Let the Party Going Treaty of Nice and Eastward Expansion Treaty Establishing a Constitution for Europe (TCE): Rome to Lisbon Berlin Declaration and Treaty of Lisbon Steroid-Enhanced Economic Development Post-Euro 3 Global Financial Crisis—Tip of the Iceberg First Test and Longest Battle of ECB Long-Term Refinancing Operations (LTROs) and Whatever It Takes! Stabil Wie Die Mark Conventional to Non-conventional and Asset Purchase Programme Refinancing Operations but This Time They Are “Targeted” Asset Purchase Programme (APP) Going Below Zero Forward Guidance 4 Flawed Fiscal and Stimulus Plans: A World Beyond ECB A European Economic Recovery Plan Fiscal Manoeuvres in Limited Space German Fascination with Balancing French Finance for Financial Sector Spanish Stimulus Generosity with Design Flaw Italy Wrong Side of Business Cycle Netherland’s Robustness but Not Rapid Recovery Britain’s Early Withdrawal and Austerity 5 A Jigsaw of Financial Institutions and Unions Within Union European Financial Stabilisation Facility/Mechanism (EFSF/M) European Stability Mechanism (ESM) Outright Monetary Transactions (OMT) Financial Stability in the EMU and the European System of Financial Supervision (ESFS) Single Supervisory Mechanism (SSM) Single Resolution Mechanism (SRM) European Deposit Insurance Scheme (EDIS) Union of Compromises and Completion of the Banking Union Unions Within the Unions Capital Requirements Regulation and Directives Markets in Financial Instruments Directive (MiFID) EU Reforms Plans of Four Presidents Five Presidents Plan A New Commissioner a New Plan: Junker Plan COVID and Europe: ESM, EIB and SURE Fiscal Union or Framework for Fiscal Policies Fiscal Stability Treaty or Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (TSCG) European Fiscal Compact European Fiscal Board Learning from Good Practices 6 Stagnation in Europe: A Lost Decade Europe Will Above All Be Judged on Results 7 TARGET2: Off the TARGET Eurozone Monetary system—A Hub with Many Spokes Trans-European Automated Real-time Gross Settlement Express Transfer System (TARGET2) OFF the TARGET Secret Bailout, Is It or Isn’t? Stagnation & Settlement of TARGET2 A Settlement Mechanism 8 Europe: The Way Forward Seven Decades of Integration: A Work Still in Process COVID-19 Mother of All Crisis for EU ECB’s Response: Another Battle to Pick Fiscal Measures: Death of Debt Break EU and European Commission’s Response Green New Deal, Digital Agenda and Ambitions for Global Leadership A Europe Without UK Rising Asia, New Trade and Cold Wars Can Europe Be a Good Example? Closing Remarks Appendix “A” Euro Area NCBs’ Contributions to the ECB’s Capital References Index