"Macroeconomic governance in the European Union: Did we learn the lessons from the past?

Since the Rome Treaties, the question of the organisation of macroeconomic and monetary policy has been a key issue in the debates on European integration. In this paper we explore the continuity and changes in these debates. We focus on macroeconomic thought at the European Commission in two periods: the 1960s and early 2000. There are important changes, especially in the areas of monetary policy and structural policies. In the early period, exchange rate disturbances (like after May 1968 in France), constituted an important threat to the European project. With the realisation of monetary union and a stability-oriented monetary policy, monetary disturbances and threats have largely disappeared. So, according to the Commission analysis, there has been substantial progress in this area. With respect to structural policy, one can observe profound changes in the underlying economic policy paradigms. While state intervention was high on the agenda in the 1960s, now a more market conform approach is advocated, which is also prominent in the Lisbon strategy. There is also a change in methodology: from "programming" to the "open method of coordination", even if both are set in a medium-term framework. However, looking at the coordination of budgetary policy, the issue is much more complicated. With the Maastricht Treaty and the Stability and Growth Pact, the European Union made a choice for a rules based fiscal framework. However, as is well known, there have been problems in this area. In fact, there are some remarkable continuities here with the 1960s. Several issues, which were prominent on the Commission agenda then (like, how to have influence on Member State policies, statistical governance, the construction of early warning indicators) are still there today. Consequently, the Commission is now, very much in line with a political economy approach, seeking to increase the national "ownership" of the budgetary and reform policies which it advocates