Many citizens believe that European cooperation benefits only the privileged and that workers and pensioners face higher taxes because cross-border integration has helped the rich find ways to avoid paying their fair share on interest and capital gains. Common rules to eliminate cross-border tax evasion — and thus erase this perception — should become a priority. Participation in a common financial market should not be allowed for free riders who refuse to share information. Cooperation with havens like Liechtenstein or Monaco should be ruled out unless they accept that within the common market, all citizens must pay taxes where they live, according to the rules of that country.
Policy coherence within the EU must also be improved. The motivation to implement further reforms of the internal market has weakened, leading to a situation in which even decisions by EU leaders at their European Council meetings can go ignored.
Too often, special interests are allowed to overrule common European interests. Europe needs to curb subsidies for old and dying industries and to invest the money saved in future-oriented sectors.
The last thing Europe needs is to reinforce unnecessary centralization. A dynamic and successful Europe is not a one-size-fits-all Europe and European integration must not become a goal in itself, but a means to create sustainable prosperity. Nor do we need cosmetic efforts to pursue EU-wide policies to combat the current crisis, when it is obvious that we have failed to act together.
This is particularly important in the area of worker protection. European nationals are unlikely to support measures to strengthen the EU if this means that working conditions can no longer be decided locally.
Yet the European Court has fueled frustrations by undercutting local labor practices in notable recent cases concerning workers employed in Sweden and in Germany. Europe, to be blunt, must devote more energy in the years ahead to addressing its micro challenges rather than to promoting grand ideas. If we stick to that principle, the EU will have a much better chance of regaining global influence.
Leif Pagrotsky is a Swedish lawmaker, vice president of Riksbank and a former minister of industry and trade and minister of education, research and culture.
Copyright: Project Syndicate
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