Schnell, Frau Merkel

First it was Greece, then Ireland and Portugal. Then, punctually, came Spain’s turn. As far Italy is concerned . . . well, let’s knock on wood. Would it be even reasonable to affirm that Europe exists if we let the markets attack and unabashedly hit one country after another? The answer is no!

Since June 5, this publication has been publishing editorials by Europe’s founding fathers to remind everyone that the next summit, scheduled for the end of this month, cannot be the 25th meeting in a row where no decision is made. One quote alone by former German chancellor Helmut Schmidt perfectly describes the current situation: “The great Germany is losing its sense of history, of its European rehabilitation, and of solidarity with its partners.”

Ms. Merkel, you can’t go on like this. You will not go very far if you continue to be indifferent to the Greeks’ anger and distant from the Spaniards’ wounded pride, the Italians’ fears, the French’s anxieties. Taking out 100 billion euros (belonging to European citizens—Italians for the most part) to defend Spanish banks and find ourselves with the BTP-bund split at 473 points (return rate at 6 percent) and the Spanish bonos-bund one at 520 (return rate at 6.5 percent) is just the last red flag in a general alert that you continue to ignore. There are no alternate routes. We repeatedly said and wrote so. We must deliver a strong message to the markets: Europe exists, and it will continue to exist. Period.

The time for words is over: with a 10-year delay the European political integration design must be completed through concrete steps, which should be implemented immediately.

1. A unified warranty for European bank deposits. To those who raise (partly justified) moral issues about its introduction, we must explain that without this particular tool even those who behaved well run the risk of overpaying.

2. Direct access to the States Rescue Fund (European Financial Stability Facility, or EFSF) granted to credit institutions. This might seem like a detail, but it’s not. Yesterday’s turbulence in the markets were generated exactly by the idea that help will come from a second stability fund, the European Stability Mechanism, and not from EFSF. This has a direct impact on the quality, and risk factor, of Spanish national bonds.

3. Unification of southern European countries’ bond rates—and not only on southern ones—which so far has proved extremely costly. This last point is the most complicated one. It can be implemented only by exchanging common protection with constitutional reform in every single country involved. It will require giving up part of the national sovereignty and acquiring some European sovereignty sealed by a new and real constitution. To turn this idea into reality those at the helm of government in every single country (France and Germany included) must have the strength to convince their respective electorates of the short- and medium-term benefits of such a choice. It might look like a daring process—for sure not an easy one—however, it is almost an obligatory passage if we, the European states, don’t want to end up like those 10 little Indians in Agatha Christie’s novel.

This is needed right away. It is needed for Europe as well as for Germany. To knock down the economies of Europe—where 60 percent of its exports and most of its foreign assets are—is not in Germany’s interest. Mario Draghi pumped out liquidity like the ECB had never done before. And he is ready to do it again. However, he keeps repeating that “lifting the fog” should not be up to him. Mr. Draghi is right. It is up to Chancellor Merkel to recuperate the political strength of Europe’s founding fathers and bring Helmut Kohl’s design to completion. A strong and healthy Germany cannot possibly exist amid the ruins of European countries, large and small. The bill would be too high for all.

Ms. Merkel, accept the good proposals for growth by the U.S. and China while firmly rejecting their sympathies when driven by vested interest. Rediscover pride in leading the formation process of a new Europe, an area of ancient economic culture and history. Public debt in the euro area is equal to about 90 percent of its gross domestic product. In the United States the crisis of private debts in 2008 determined a public debt largely higher than its GDP. If Europe finds quickly its political unity it will be a fierce competitor for everyone and will be able to ensure income and employment for a new generation of its citizens

Otherwise, you will be overwhelmed by a spiral of defensive interventions that will jump from one country to another. Sure, they will buy us time, but eventually they will sentence us to decline. If you and your country want to remain the protagonists in Europe, there is no more time to waste. Score not one but at least two or three hits and score them fast so that it will be clear to all that the United States of Europe is indeed a reality and that the euro is no longer attackable. Schnell, Frau Merkel, hurry up!