Crises are opportunities for change. And the EU, immersed in the pandemic, is living the challenge of facing the integration model for the future.
The 2008 crisis strengthened the Economic and Monetary Union, economic supervision and common governance. These changes were put together under the umbrella of fiscal discipline and did not mean progress towards a greater budgetary union. Most important of all, the reinforcement of social cohesion was left in the pipeline, which was clearly subordinated to the fulfillment of macroeconomic objectives. The increase in poverty and inequality were a consequence of this rigor.
The current COVID 19 crisis has shown learning. On the one hand, at the beginning of the pandemic, budgetary discipline was relaxed immediately, allowing greater spending slack to the states through the safeguard clause. With this reform, they avoided the repetition of the axfisiant austerity model and its dire social consequences.
The agreement reached at the European Council on July 21 is crucial to continue in this direction. For the first time, the EU has skipped its spending ceiling and reaches 2% of GDP. For the first time, the EU admits borrowing to make a massive injection of capital, (just what was so much missed in the previous crisis compared to the maneuver room of the United States). With this decissions several important leaps are made: one towards the deepening of fiscal integration, another of political response and demonstration as a supranational power that has supported its partners (demonstrating against exit movements, such as Brexit that, effectively being in the integration is worth it.
Of course, many issues remain pending, such as how conditionality is to be exercised, that is, supervision of compliance by recipient States with the requirements for spending funds. Also left for reflection is the reduction of the Just Transition Mechanism to feed the new Reconstruction Fund.